Katliamom, Staffords are part and parcel of most financial aid packages. No parental co-signature needed. $5500 for freshmen, $6500 for sophomores, $7500 per year for juniors and seniors. Both my kids took out Staffords (but didn’t max out) as part of their share of college expenses. They knew they could pick the college of their choice, but that there were limits to what we could do for them going forward if they went to a pricey school, namely not providing a car and or grad school. We just don’t have the income to do that. Both of them knew the deal in 9th grade and came out with acceptances that gave them excellent options, including some with merit $$.
S2 borrowed about $26k (including unsubsidized interest accrued on a portion of the loans). He has paid off one loan already ($50/mo), and his current monthly payment is about $260. It’s not terrible.
S1 borrowed a bit less and paid monthly installments for several years to establish good credit. I think he has since paid them off.
That said, we were not going to let them take out private loans (requiring our co-signing) or take out Parent PLUS loans.
In other discussions on these forums, posters decry the fact that so many college students choose overtly pre-professional majors (business, nursing, engineering, etc.) over liberal arts majors like philosophy. But then these forums skew toward high SES, where parents can presumably support the student going to college without loans, and support the student living at home for some time after graduation during an extended job search. Students from poor and middle income families may not have the luxury of attending college without loans, and are more likely to need immediate employment at graduation.
Of course, studying a pre-professional major does not necessarily mean getting a job of that type quickly at graduation. Targeted jobs may be subject to industry downturns by the time the student graduates (ask a petroleum engineer). Some pre-professional majors may attract heavy interest from high school seniors (e.g. computer game design) but the job market is more limited than the students may believe it is.
When our S graduated from his private U in 2010, one of the other graduates was complaining he couldn’t find an engineering job after he got his bachelor’s so he stayed at school for his masters in engineering and now just owed more and still didn’t have a job.
I have no idea what other options he had or what strategies he used or why he had no job offers. I also have no idea what his debt was but believe it was high.
I’m sure there are many others like him. The current system makes borrowing very easy with no assurance that the student or family has ANY good understanding if what they’re commiting to and what that means.
What kind of engineering? Civil engineering was hit hard during the downturn, where real estate and construction crashed worse than most other sectors of the economy (taking some of the finance industry with it), so graduating civil engineering had it worse than graduating other engineers.
Although some graduating civil engineering went to graduate school instead of the unemployment line, that mostly made sense for funded graduate programs. Adding more debt in an unfunded graduate program in that situation is a risky choice (basically betting on the job market being better at the future graduate date, at the cost of more debt), but someone in that position may have had only bad or risky choices.
These people made bad decisions when it came to their schooling, and now the rest of us are literally paying for it. They seem angry because nobody handed them a good-paying job when they graduated.
Why not just rob a bank and then flee the country? It’s a lot faster than going to school for 4 or more years.
@techmom99 My D1also got into Tisch, and they offered her a decent scholarship. The problem was NYU COA was 70k AND they didn’t guarantee the scholarship was renewable. It broke my heart to say no, but I told her it didn’t make financial sense given at the time she wanted to study film. I told her to take one of the other offers and if she still wanted to do film, NYU would be there for grad school. She spent her first summer in Brooklyn interning with a bunch of starving artists working at the same unpaid internship. She told me she was glad I said no. She had a few friends that went to Tisch and she seemed to have more internship opportunities than they had. Best decision ever!
At the end of the day, it is not society’s fault that a student made bad personal choices.
Yes, society says that you should go to college because college graduates make more money. This is factually accurate because those statistics include not just those kids majoring in dance and comparative literature, but also those kids majoring in engineering and health-related fields that pay more.
If we blame the lenders and not the students, then we may just revert back to the days when only wealthy people with collateral could get loans. Millions of lower- and middle-class students would be left out of the college equation because they wouldn’t be approved for loans in the first place - millions of students who will wind up paying their debts responsibly.
Considering how many times students change majors, there is no way we could reasonably tie student loan approvals to possible majors and career choices.
As with every loan, the borrower is responsible for knowing the terms of the loan. Every state has a system of community colleges and other pathways that can lead to a college degree, including one in comparative literature, without amassing a mountain of debt. And, if you look at the comparative literature professors at your local universities, there is probably little to distinguish who graduated from an Ivy and who graduated from the state flagship other than a piece of paper on the wall.
We all want our kids to pursue their dreams, or at least have the opportunities to pursue their dreams. However, most dreams don’t become reality. As automation and artificial intelligence become more widespread, the problem will only get worse, affecting more sectors of our society. A college degree from a third rate school won’t be worth very much, if anything at all. That day may not be too far away and we need to start preparing for it.
No one twisted this guy’s arm to get a useless degree. No one twisted this woman’s arm to go out of state. No one twisted her parents arms to co-sign that much debt over to her. There’s no victim here. These people are dealing with the consequences of their own foolish choices. Seriously…India? You can get a masters degree in something employable and expand your job search to outside the city you grew up in.
I think we should be funding our public options better to have an affordable low-to-no debt option available for everyone. Society as a whole pays for all this defaulting in the end anyway. I’d rather we just clean up the system on the front end so it’s not so easy for students to get buried in debt.
^^be wary of interpreting such articles MusakParent. The numbers typically conflate Grad loans with undergrad loans, particualry when reported by a “progressive think tank.”.
At what point is someone no longer just a naive and uninformed teenager but an adult who makes adult decisions (and maxes out Grad Plus loans)?
We need to teach our kids fiscal responsibility, at a young age. When choosing colleges with our kids we bluntly told them that we can send you where we are able to afford it. They are both taking on some loans. Both do work study. We have some 529 money. We are attempting to pay down some loans when we can. Both have merit that helps. We showed them both what “x” amount of loans looks like at the end of 4 years per payment per month. My daughter couldn’t go to her number 1 school since it was just to expensive with another kid coming up 2 years later. It ended being the best decision we made since she is definitely where she needs to be in college.
Traditional college students make their college decisions while still under supervision and guidance of their parents and high school counselors/teachers. While that is not the fault of “society”, the fault when making a bad decision for one’s first big “adult” decision (often while still not legally an adult) must be shared with the adults who are supposed to provide good guidance. Unfortunately, as we know from typical saving and spending habits of adults in the US, most are not particularly good at handling their personal finances and therefore set poor examples for the kids they are supposed to be guiding and/or may encourage fiscally reckless decisions.
A generation or few ago, states funded their state schools well so that in-state tuition was low, and people could be self-supporting with high school graduate jobs, so that even those without parental money could work their way through college more easily than now. Also, a college degree then opened more good job opportunities, unlike now, where a college degree often merely qualifies one for a job that could be done by a high school graduate but where the employer requires a college degree just to reduce the number of applicants.
It is already the case that parental money is a big factor in determining whether someone will attend and graduate college, and current trends are likely to increase the importance of parental money relative to student academic achievement.
http://online.wsj.com/public/resources/documents/info-Degrees_that_Pay_you_Back-sort.html indicates that philosophy graduates have a very wide range of mid career pay outcomes. The 90th percentile does very well compared to other majors, but the 10th percentile does poorly. Also, median entry level pay is not that good, but median mid career pay is relatively better.
It looks like philosophy is relatively high in both risk and potential reward in career and pay aspects. A student from a high SES family may be more able to mitigate the risks (family money to avoid college debt, family support after graduation during extended job searches or poorly paid entry level jobs) than a student from a low SES family.
I agree. As college-educated financial advisers, I for one always expect teenagers to make appropriate, long term financial decisions. Society bears absolutely no responsibility for presenting them with Hobson’s choice.
Solution - turn some state universities into super cheap ones - classes in the thousands, etcs. That’ll be for the students that don’t want a ton of debt.
Students can’t want both great amenities and a great price point.
Fwiw, I have no interest in running from our student debt.
I am interested in leaving the US. Why? Because i’d really like to live in a country where a college education and health issues don’t bankrupt people.
ETA: I went to an in-state college, had scholarships and financial aid, and still had to max out of direct loans while working full time.