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<p>Does anyone know where the source is for this information? Why isn’t a spouse responsible for this type of debt?</p>
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<p>True statement, sk8rmom…many parents engage in magical thinking when it comes to college funds.</p>
<p>On the funding of college accounts…Did anyone 18 years ago think that a private college education would cost $250K? I didn’t, my husband didn’t, and even though we have always saved, we didn’t come close to saving the $500K for college (we have savings, but it is not all for college) for the two kids. We definitely went to plan B.</p>
<p>NEmom, you can find many sources, including finaid.org and studentaid.ed.gov, on how Plus loans work and the “death benefit”. It’s done that way by design but, in general, a surviving spouse isn’t responsible for an unsecured debt that’s solely in the deceased spouse’s name (though their estate may be).</p>
<p>MD Mom, I completely agree. We didn’t expect college tuition to increase the way it has in the past 20 years. I look at our younger relatives, and wonder what it is going to cost by the time their preschoolers are college age. </p>
<p>The bubble will burst, I’m just waiting for that moment of “Aha!” that tells me it is happening. (I had an “Aha!” moment in the spring of 2006, when our neighbor put his house on the market at an eyebrow-raisingly high amount… and not only did it not get multiple offers with escalation clauses on the first open house, it didn’t sell at all. I knew after the second open house with no offers, that the real estate party was over.) </p>
<p>Wonder what the college tuition “Aha!” moment will be.</p>
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<p>Wait until you are ready to retire. Those who have not saved a penny will also need a bailout. Want to guess who will be paying for that one?</p>
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<p>You forgot that many of us have to have food to eat first. Not everyone has extra cash to save for college. </p>
<p>We are extremely fortunate that DD got into a top school both academically and financially. The generous need based FA enables us to get her out of the college w/o getting any loan.</p>
<p>To OP’s discussion point, yes, we have to reduce our contributions to retirement to fund our kids’ education. And that our DS has to take on subsidized loans. However, we feel like those are good investments for their future.</p>
<p>Dad II and thats great.</p>
<p>My point is when there is not sufficient aid, kid and/or parents should not be aided and abetted into taking out outrageous amounts of loans.</p>
<p>While putting 25 dollars a month from birth isn’t a lot, it IS something…increasing that amount yearly, and one should be able to set aside 1/2 costs of a state school without much pain…we also didn’t plan on 50k+ per year per child, 2 in college in the fall, we did have almost 2 years set aside…with some belt tightening, we hoe to have them graduate withut any debt. Fingers crossed…</p>
<p>Kayf, ‘aiding & abetting’?! :)</p>
<p>No one, absolutely no one, forces a parent to take out a loan, private or PLUS, for their child’s education. Just become the process has become more or less streamlined doesn’t mean that because of its simplicity it absolves the initiator of the loan responsibility of the knowledge of its risks. And I agree there have been some yo-yo parents that probably have bitten off more than they can chew, albeit with their hearts in the right place.</p>
<p>Way back…in 2005…students that took out Stafford loans were made to take a short online tutorial on rudimentary fiscal terms like lending, payments, accruing interest, etc. Don’t know if this practice is continuing but no doubt it would be a good idea for some parents too.</p>
<p>Totally agree with beolein: Back to the original post, parents need to learn that retirement comes first and their children may not be able to go to the college of their choice due to finances. </p>
<p>Not all kids have the right to a $250,000 education!</p>
<p>I am amazed at how many of my peers are struggling to pay for college. For the most part, these are college educated, professional (one or two income) people that live very comfortably. None of us could have anticipated the current price tag or that our homes would not be a source of equity in the future, but the vast majority of us should have been saving for some chunk of the cost. </p>
<p>I think we are all responsible for our own debts. If you are smart enough to go to an expensive college, you should be smart enough to ask the appropriate questions about financing the cost. I don’t want to effectively pay for my neighbor’s kids’ educations, thank you!</p>
<p>My older one, now a senior in college, has the full complement of Stafford loans, though I’ve been paying all interest accrued as things have gone along to keep her balance equal to the original principal.</p>
<p>My wife and I have refrained from taking out any loans in our names, opting to live in near-poverty. The last payment has been made.</p>
<p>My younger one, now a senior in high school, has received much larger scholarship offers. If all goes well, none of us will take out any loans, and I will never fill out FAFSA again.</p>
<p>jnm, and no one forces a bank to loan to uneducated parents. They should be taking on more of the risk. Otherwise the rest of us, who have not borrowed excessively, will be bailing them out. Is that fair?</p>
<p>Momof2Kid – I wish we, the taxpayers, will not be bailing them out. But I suspect we will. Do you think it fair that banks make gazillions on these loans, and we will be left holding the bag?</p>
<p>Quote:</p>
<h2>I think the real problem is that most parents aren’t adequately funding their kids’ education accounts in the 18 years before college and have no idea of how financial aid works until it’s too late.</h2>
<p>I think those parents who are borrowing a lot need to first ask themselves…“If we weren’t able to save for college in the past, then how will be able to afford the payments in the future?”</p>
<p>I never understand that. The same people who can’t set a aside some money each month to save for college think that somehow - magically - hundreds of dollars if income will be left over each month which can be used towards loan payments. This kind of thinking even goes on in REAL TIME…when the kids are IN COLLEGE.</p>
<p>Some parents are paying nothing towards college and borrowing the entire amounts that they’re expected to pay. If they don’t have any extra money now to put towards college, how will they ever make loan payments???</p>
<p>I totally understand if “take home pay” is already spoken for…mortgage, food, etc. So, if that’s true, how will you be able to pay back future loans? Isn’t that just delaying the problem?</p>
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<p>DadII quote:</p>
<p>"You forgot that many of us have to have food to eat first. Not everyone has extra cash to save for college.</p>
<p>We are extremely fortunate that DD got into a top school both academically and financially. The generous need based FA enables us to get her out of the college w/o getting any loan."</p>
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<p>I get that many can’t save for college. But what would you have done if DD hadn’t got that great aid? Would you have borrowed $200k??? Or would you have said, “Hey honey, either commute to the local state school or find a great scholarship”?</p>
<p>Mom2collegekids, it’s a ‘Let’s Make A Deal’-type decision that’s made every day (tongue in cheek): </p>
<p>Door #1–siphon retirement funds for high-powered school, lots of debt, hope D or S (with hopefully high-powered job) kicks in to help when I have no $$$ left.</p>
<p>Door #2–‘force’ D or S to attend state school, hope things turn out OK & he/she doesn’t put me in nasty nursing home.</p>
<p>Door #3–spend like a banshee, ‘game’ the system, hide income & savings for need-based aid, hope IRS doesn’t come a-calling.</p>
<p>*Door #2–‘force’ D or S to attend state school, hope things turn out OK & he/she doesn’t put me in nasty nursing home.
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<p>???</p>
<p>Good heavens…If I had to spend retirement savings (or borrow big bucks) out of fear that my kids will put me in a “nasty nursing home” because they went to a state school, then I have a bigger problem…I raised ungrateful, bratty, entitled kids. </p>
<p>And, I don’t “get” this thought process that going to one’s state school somehow sentences a child to mediocrity, while spending for an OOS public or private somehow ensures dreamlike success.</p>
<p>When we sent DD off to fancy private day school, I told her that I expected a really nice addition off the back of her house. Now that she is in a state school, I hope she isn’t thinking nasty nursing home for me. Guess I better ask her.</p>
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Truer words were never spoken. Before our first kid was born, I remember estimating that $100k would be enough to cover any school for four years, even the very best. And it would have been true, if college prices had simply tracked inflation.</p>
<p>Lots of us saved,weren’t extravagant, and it IS frustrating that those with zero assets are eligible for substantial FA while people with assets (savings) aren’t. We are already subsidizing people who didn’t or weren’t able to save. At the same time, our investments did get hit very hard by stock market losses over the last ten years, so retirement IS questionable and not because we didn’t save, but because we weren’t as lucky/smart as we could have been on picking investments – got bad advice from greedy advisors basically.</p>
<p>I agree with people here who say it was hard to imagine college would be as pricey as it is… and the truth is… college costs went up when people had lots of home equity and fat stock accounts… and now those are lower and college costs have stayed in the stratosphere. I think colleges are eventually going to have to reassess their tuitions if people’s wealth doesn’t come back.</p>
<p>mom2collegekids–it 'twas tongue-in-cheek, as I said. Both my D’s went to OOS state schools, and are faring wonderfully. I like MDmom’s wing on the back of the house thing better…:)</p>