Still, it indicates that Pennsylvania residents are worse off than those in many other states in terms of in-state public college costs, including at their non-flagship state universities.
This does not mean that parent loans or parent-cosigned loans are good (far from it), but it shows the context of the cost problem that students and parents in Pennsylvania are more likely to face than those in other states.
There is a list of the top 10 most expensive public colleges for OOS students. Vermont was always at the top of the list, but then California raised its OOS tuition and stopped giving any FA to OOS students. Now the list is a list of California colleges. They all cost about the same, so if one makes the list, they all make the list. Vermont might not be on the list anymore, but it is not because it is suddenly a bargain. It doesn’t matter if you go to West Chester or Bloomsburg, the PA state COA is going to be the same and a family will have to borrow the same amount. It makes sense that if the family is going to borrow to go to IUP it’s going to have to borrow the same amount to go to East Stroudsburg. Both make the list.
I do think the borrowing for college is contagious. If your neighbor borrows, and your co-workers borrows, and all the parents from the team are complaining about student loans, you begin to get comfortable with the idea that you have to borrow to go to college.
It might be contagious but you just don’t know your neighbors true financial picture. Even on the same block, in the same house, with the same property taxes and an almost identical standard of living- one family has two earners, two defined benefit plans plus IRA/401K from previous employers, very low cost/employer subsidized health care. The other family has one wage earner, a bare bones medical plan with high deductibles, and a 3% match to a 401K which they haven’t been able to contribute to for the last couple of years.
The first couple might be a good bet for some education loans, especially if they are 48 and 50 years old and in good health. The second might be a terrible bet for ed loans since the wage earner is 59 years old and the non wage earner is 55 and hasn’t had a full-time job in 20 years.
People need to understand their own risk profiles. What your neighbor is borrowing or what the parents on the team are borrowing is really not at all relevant to your own situation.
^^^
Very true. And people sometimes do think…”well, the Jones are borrowing and our income is similar so borrowing is ok”…but as Blossom mentions, the details may be very different…and the other family may know that there’s a large inheritance around the corner or some other windfall or some other means to bring in more money to cover the debt.
Some parents may think of taking on loans as cleaning up the mistake rather as compounding it, though.)
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^^^. This
Many have believed the spiels that colleges give out millions and assume that they too will get a huge amount. That’s why many tell their kids, “apply where you want and when the offers come in the spring, we’ll look at them all and decide.” Then spring comes and none of the offers are good …so loans are the magic wand, in their minds, to clean up the mess and save the embarrassment.
Asking your parents to cosign on almost a hundred thousand dollars of student loans and throwing a tantrum when they refuse is so selfish and childish imo. My parents are willing to cosign on loans, but I am not even considering it because I don’t want to put myself and them into extreme debt, especially not for an undergraduate degree. You can always leave your state for grad school/a job
Love the college that loves you (with merit money!). Majority of self made millionaires carried little to no debt and went to regular, not big name-big buck colleges. One can have just as much fun and experience in a state school versus a OOS one. Many public state school accept up to and over 50% OOS so you are meeting lots of new people. Also, take advantage of study abroad if you want something different - many schools charge the same tuition etc overseas as they do in the US - get a PT job to pay for airfare.
It’s really the parent’s fault for co-signing loans for that much debt. There is no rational reason for anyone to graduate with that much debt unless the degree says M.D. next to it. They completely set her up for failure by caving to emotional demands rather than teaching her the facts about money. She’ll hopefully learn that when loan payments come due. Sometimes parents need to exercise their financial authority and say no.
My daughter is 11 and just starting middle school. We’ve already had this discussion with her. We basically said that you get to go where the bank account says you can go. Fortunately, she doesn’t have any desires to go to an exotic university out of state. Fortunately in Texas, there are plenty of exotic universities here that are within our budget.
^ and also, if she does well (test scores, 4-8 APs or equivalent) she can apply to colleges OOS that have merit and will bring costs roughly to the level of instate. That can be a powerful motivator for kids. In addition, knowing of the oos options creates a valve for Texas kids - instate and OOS privates plus OOS publics with merit don’t care if you’re top 7% :). So, as long as they do well, high achieving students have choices even if they don’t ‘game the rankings’.
The key is to plan.
In that respect, first gen kids are behind because they ndont know what they don’t know’… But all parents reading cc are way ahead.