<p>The interesting tidbit I’ve seen on this story is that Ben Bernanke’s son has $400k in student debt. :eek: He’s in med school, which does tend to generate big debt. $400k, though, tends to be the sort of thing from a student who also took out big loans as an undergrad. Not so common when coming from a presumably well-off family. Odd.</p>
<p>Maybe Ben listens to Dave Ramsey - Dave says why go to a school that charges more than your state U charges. ;)</p>
<p>Is this Ben’s family well off? Did I read that correctly? If you know you will have the money to easily pay off the loans, who cares how much you take out. If this family has millions, the low interest loans is probably saving them money in the long run vs pulling the funds out of investments. It’s not a bad idea, if you have the money.</p>
<p>kelsmom-“charges” more or “costs you more”. I’m not a Dave fan but that is a big distinction. If I went to our state University when I was in college it would have cost me $20,000 more than the private school I attended.</p>
<p>Not sure if you are trolling, SteveMA, but Ben Bernanke is the chairman of the Federal Reserve. I’m sure he is upper middle class, but I don’t think he is wealthy on the lines of Romney or even Gingrich. But he has great earnings potential once he leaves the Fed. </p>
<p>Maybe even he could not talk his adult son out of taking enormous loans :)</p>
<p>delamer–nope, not ■■■■■■■■, just not in the know I guess…Even so, it’s not unreasonable to assume that the Chairman of the Federal Reserve has some financial smarts… I don’t know the story though. I don’t really care what other people’s kids do with their money :).</p>
<p>In a quick google search [11</a> Things You Didn?t Know About Ben Bernanke | Weakonomi¢s](<a href=“Weakonomics.com”>Weakonomics.com)</p>
<p>Looks like he made over $2,000,000 last year and he drives a Ford Focus ;). Yep, he probably advised his son to take out the very low interest rate loans knowing there is cash in the bank that is earning more.</p>
<p>I’m surprised none has pointed out the elephant in the room.</p>
<p>The student loan debt is subsidized in not only its interest rate, but also in its access. Unless and until someone defaults on their student loan debts they are guaranteed close to $170,000 worth of debt, should they take the maximum through their undergraduate and use the 5-6 years of $20,500 a year guaranteed at graduate school. </p>
<p>That’s completely different from a Credit Card or Auto loan, where income has to be proven as a condition of the loan and the amount of money loaned is much smaller than the amount that the government guarantees.</p>
<p>Bernanke makes about $200,000 from his job and apparently additional money from textbook royalties. So he certainly isn’t poor - even for DC - but $400,000 is a 2nd home!</p>
<p>But my main point was that even with his credentials, if his adult son wants to take out that much in loans there isn’t anything he can do to stop him.</p>
<p>I know students and their parents are sometimes not sophisticated about money and debt repayment. But it is hard for me to be sympathetic to someone who takes on $170,000 worth of debt without a very clear repayment path.</p>
<p>The federal govt should loan students money at the same 1% rate they have been charging the banks.</p>
<p>@sax: Amen. BTW, you were a heck of a ball player.</p>
<p>“Bernanke makes about $200,000 from his job and apparently additional money from textbook royalties. So he certainly isn’t poor - even for DC - but $400,000 is a 2nd home!”</p>
<p>-This family could EASILY pay for UG and Med. School. It is NOT a funciton of income to some degree, having or not having student loans based on this example is a funciton of family desire to pay or not for kids’ college education.<br>
Student Loans are expansive, much more than (for example), equity loans.<br>
Family with lowerincome than Bernanke can pay for both UG and Med. School if they plan right and have desire to do so.</p>
<p>I would like to echo the comment above that people with debt will wisely pay off the highest-interest debt first, which probably explains a lot of the persistent educational debt (as well as why Bernanke’s son probably borrowed so much). Indeed, if you think you might want to buy a house in the next few years, it might make more sense not to pay off your student loan, but to save that money for a larger down payment on your house.</p>
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<p>Perhaps the federal government should just stop loaning students money, period. Perhaps Congress should allow education loans to be eligible for bankruptcy proceedings. THAT will avoid any potential loan bubble. :)</p>
<p>btw: not sure why everyone is speaking about Bernanke’s son’s med school loans. In the first place, it’s none of our business. (Yes, he did bring it up publicly.) And yes, Ben is probably wealthy enough to pay the med tuition. But perhaps he doesn’t want to. Perhaps the deal with his kids is that he pays for undergrad only. Perhaps he wants his kids to have some skin in the game. Who knows, and why should we care?</p>
<p>Just because other parents are subsidizing their student’s medical schools/grad schools doesn’t mean that every other parent should (even if they have the income to do so).</p>
<p>^But it is worthwhile mentionning, since it might not occur to some that they might negotiate with parents financing Med. School while choosing free UG. I believe it is much better option than going to expansive UG and have Med. School loans later. But again, it is everybody’s choice.
We are discussing all aspects here because OP started the thread for mostly entertaining puposes, there is no learning except if we try to share our experiences and I quess that what we are doing.
Again, if something is disturbing, then do not read it, ignore, put person on ignore list…</p>
<p>I grew up on the other sides of the tracks, so I find few things ‘disturbing.’ </p>
<p>My point is more of relevance. Unless one is wealthy like Bernanke, his personal situation is not relevant to the masses.</p>
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<p>Hahahahaha. Sure, it might not occur to “some” but I would submit that would be extremely rare. Kids start learning how to negotiate with their parents when they spring from the womb. :)</p>
<p>But still to make it relevant, do you know that Ben’s son did not attend a college on a merit scholarship?</p>
<p>^Not very rare anymore. I heard here on CC, that about 25% of Med. Students are financed by their parents. In many of these cases, these students choose to go to FREE UG to have this option. I have no idea what Ben’s son did or did not, I do not care, I am sharing information relevent to OP. If he did not choose free UG, he had valid reasons for that. We need to ask him personally to share. However, I suggested that if he did, then it could have resulted in no loans.</p>
<p>The fact that Ben made 2.2 MILLION dollars last year alone and still drives a Ford Focus leads me to believe he is looking at this from a fiscally responsible standpoint, a fiscally responsible standpoint MOST of us have little understanding about because we don’t have several million in spare cash lying around. Again, these loans are at VERY low rates. By taking these loans vs paying cash they are MAKING money. It’s pretty simple.</p>
<p>If you had 40,000 in an account earning 5% that you didn’t need and got a great deal on a car and were offered 0% financing would you pull that 40,000 out of the bank to buy the car for cash or would you take the 0% financing? I know which one I would take.</p>
<p>What if student loan debt does not give a return and proves to not be a good investment after all, especially in this recession? I know a whole bunch of college graduates struggling to find jobs and still depending on their parents despite holding such a stellar college degree. When they do get hired, they work positions that don’t even require a college education. Where’s the pay off on that student debt they accumulated? If they had known better, might as well don’t go to college and start getting their work experience right out of high school.
The alternative is this: just work right out of high school, get some years of experience, and move up the ranks in your company! No need to attend college and accumulate debt that possibly would never earn you a return!</p>
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Don’t confuse long-term and short-term return.</p>