Who are the students in massive debt

Paying for College
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<p>*What is your major/career goal?</p>

<p>Sobering detail: young, brilliant, newly minted Ivy med grad turned down a full-ride at a very good regional state U. Just learned she is 300k in debt.</p>

<p>Just shows that a student can be “book smart”, but not have the walking around smarts to see how insane that is. The payments must be over $3k per month! What idiot co-signed those loans?*</p>

<p>My major is nursing, so that means to get into any college I need to have a 4.0. I mainly want to get an RN license and then specialize in cardiology or pediatrics (masters). I looked around on some websites of the hospitals I want to work for (where they list their staff’s credentials) and many of them had masters from UC and a BS from CSU/state!</p>

<p>"$500 a month for a $50k" sounds terrible to me! I don’t want to shovel out nearly $6000 a year for something I already have. I know a nurse (since it’s my major I seek these people out) who has $10k debt left from graduating in 1999, that’s 13 years of just paying off loans. And she only went to a community college! (she had to wait 3 years for her program). Noway! I can get my BS and apply to UC later after I get work experience. I’ll be more highly educated and have a larger job area (I see in SoCal at least 1/4 of the jobs require a masters). If I get could recommendations (I know I have at least 1 from an Anatomy prof- I was 2nd highest student in 3 classes). I can go to UC, I can handle it easily academically, I just would like to have less debt, more opportunities, faster entrance into my field. I’m paying for my education completely by myself/financial aid, ect.</p>

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<p>Best wishes seaside22! It sounds like you are continuing to seek out a low/no-debt path. Good for you.</p>

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<p>Kudos for looking up credentials and speaking with people- and trying to have a solid plan. Best of luck.</p>

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<p>One of my friends told me she had spent half a million dollars(!) on her daughter’s education- 4 years of OOS undergrad, and then vet school. The daughter is now around 30, and still in school, doing a residency. I can imagine that med school could easily run that high- $200,000+ for undergrad at a private U, and another $250,000-300,000 for med school. It would almost be better just to give them the half a million and invest it wisely. Forget college. Isn’t there some dotcom millionaire giving entrepurnurial students $100,000 NOT to go to school?</p>

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<p>Who are the students in massive debt?</p>

<p>Simple answer, IMO: those with clueless parents.</p>

<p>Those kids who have been raised with all the parent-enabled “must-haves” of the second decade of the 21st Century. iPad. Smartphone. Own car. Fancy vacations. Restaurant meals 5 nights a week. Boutique wardrobes. $2,000 prom dresses. Big unearned allowances. Etc.</p>

<p>And then they are ready for college, and guess what. Mommy and daddy come to the realization that in spite of the income that funded all of the above, they can’t write the check for the fancy live-away college that the kid has locked onto as their “dream school.” And they - child, understandably; parent, not so much - allow themselves to be seduced by the hype that where you go to college defines how successful your life may be, and that the ratings published by a defunct newsmagazine have any value beside generating page views and advertising revenue for the website of the rump of that magazine.</p>

<p>And so, rather than sit the kid down and explain that (1) mommy and daddy can’t afford it, and (2) the kid, if they are motivated, can get a high-value education in lots of ways other than the expensive alternative, and (3) it makes no sense to take on massive quantities of debt just to go to a “top-whatever” school - the parents enable and facilitate the assumption of massive debt.</p>

<p>Oh, yes, we’ve heard it: “They’ve worked soooooo hard to earn this.” To earn what? To spend what could be the best years of their lives buried under crushing amounts of debt?</p>

<p>But how about this. That what they have earned is a lesson in life’s realities: That you can’t always have everything you want. As kelsmom and mom2collegekids continually remind us, that there is no money tree. </p>

<p>They’re going to get that lesson, as certain as the sun rising in the east. The question – one that is totally within the power of the parents to answer – is when? Whether getting that lesson is deferred until the debt starts coming due or, instead, delivered in a painful conversation that takes place before the freshman deposit gets mailed – or even better, before the college search process starts.</p>

<p>This conversation:</p>

<p>“Honey, we love you deeply, beyond anything words can express. But the reality is that our family situation makes it impossible to send you to that dream school you’ve got your heart set on. This may not make sense to you now, but the way we can best show our love for you is to help you find a great school that we can afford to pay for.”</p>

<p>And the good news is that every student can go to college, get a good education, and graduate debt-free.</p>

<p>That doesn’t mean that every student can go to a sleep-away college, full time, and graduate debt-free.</p>

<p>Most students can live at home and go to a local state school (maybe with the first two years at a CC) and graduate debt-free. But even a student for whom geography (or a destitute family) make this impossible can work full time, go to a state school part-time, and graduate debt-free. I live in a poor, rural community. I know kids who have done this. And they go on to successful lives.</p>

<p>They may not graduate in four years (though I know at least one who did, and graduated not only with no debt but also with money in the bank, the child of very low income parents, and six months after graduation was in a high-income, high-prestige job in her <shudder> communications major). But in the arc of a complete life, what is the real difference between graduating at 22 and graduating at 26? It seems to me that the student who graduates at 26 without any debt is a whole lot better off than the one who graduates at 22 with a huge amount of debt.</shudder></p>

<p>To an 18-year-old under the constant barrage of the media-fueled, prestige-college-matters nonsense, it is understandable that they cannot make rational decisions about their futures. But there is no excuse why their parents cannot.</p>

<p>So I repeat:</p>

<p>Who are the students in massive debt?</p>

<p>Those with clueless parents.</p>

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<p>My husband has a degree in computer science and me, in economics. All our student loans came out of state schools. I grew up in foster care, so I had no guidance or help. My husband had his parents pay part way. We both worked. In the end, between the two of us, we had over $50,000 in student loans. We consolidated with direct loan. But then our son was in the NICU. I ended up not being able to work for years and had tons of high medical bills. We deferred the loans. We were not wasteful at all. In fact, we had to pick and chose which medical care our son could even receive because we did not have the money. We had insurance, but each PT visit, and OT, and speech, and feeding therapy, as well as medical bills and such, cost us co-pays. Since he had to be tube fed, there was a costly formula for that too. It goes on and on. Our loans reached over $100,000 during this time. Now we are paying it down. But, even though we pay $1000 a month now (and struggle to make that), the interest is still adding up so we only pay down by a few thousand a year. I think we are at $90,000 now and have been paying $1000 a month for a few years.</p>

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<p>I should add that I will never co-sign a loan for my children to go to college. I figure if I could not save the money by now, I cannot afford to take the loans out and pay it off later. I know what our EFC is and we have saved enough to pay that. Now the kids just need to get in to schools that will meet their need without doing so in tons of student loans.</p>

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<p>* I know what our EFC is and we have saved enough to pay that. *</p>

<p>??? You have enough saved to pay your yearly EFC for your kids’ education, but you have this huge outstanding student loan of $90k??? </p>

<p>If your H is working in the CS field, then his income is likely quite good. If so, then your EFC is not low. If you have the money saved to pay the EFCs for college, then why not put that money towards that debt NOW?</p>

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<p>I don’t understand why would you say that because you are mixing 2 separate issues. There are kids making 160k in big law trying to figure out how to pay the bills living in high cost areas because of the perception of the lifestyle they feel that they should have making this kind of money.</p>

<p>It is not a matter that IBR doesn’t work in a high cost of living area. If you are making 65K, you probably are not going to be living on the UES/bklyn heights regardless of what kind of job you have. Their task is going to be to live where they can have affordable rent (even if it means getting a roommate).</p>

<p>If you take a non-profit job in NYC and you aren’t making a big salary(80k), you are going to be eligible for income based payments. In addition, if you stay in the field and make your payments for 10 years, your federal loans (which most of the direct gradplus loans are) will be discharged by the federal govt. The only government jobs not covered are judicial clerkships.</p>

<p>In addition, if your school participates in LRAP, you can combine the 2 benefits.</p>

<p>The difference in payments could be huge.</p>

<p>For example a law student with 100K in debt at 6.8% interest will pay ~$1150/Month for 10 years to service the debt (~38k in interest)</p>

<p>[FinAid</a> | Calculators | Loan Calculator](<a href=“http://www.finaid.org/calculators/loanpayments.phtml]FinAid”>http://www.finaid.org/calculators/loanpayments.phtml)</p>

<p>This same student who works a non profit/govt job for 60K a year with the same debt would pay $540/Month in IBR. If they are in a public service, the balance of the debt would be discharged after 10 years or or 120 loan payments. </p>

<p>[IBRinfo</a> :: IBR Calculator](<a href=“http://www.ibrinfo.org/calculator.php]IBRinfo”>http://www.ibrinfo.org/calculator.php)</p>

<p>a person who makes 60K year/ is bringing home ~3500/month. </p>

<p><a href=“https://secure.gtmassociates.com/calculator.aspx[/url]”>https://secure.gtmassociates.com/calculator.aspx&lt;/a&gt;&lt;/p&gt;

<p>After the loan payment, they have $2,900 to pay rent, transportation and other living expenses. While this person may not be living high on the hog, or even the kind of lifestyle they had in their parents house as a single no dependent person, they can get by.</p>

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<p>I see it a lot here. One of my son’s best friends went to NYU. First year, everyone was psyched and he lived in the dorms, grandpa paid a nice hunk of it, there was graduation gift money, etc, etc.</p>

<p>The next year, mid year, they couldn’t do it. Grandpa refused to pay anymore. Though kid was working for living expenses, it just wasn’t cutting it. So he took off a semester and worked full time and the summer to put a small dent in the next year’s cost. He also commuted. But commuting to NYU from the NYC suburbs is not cheap. About $300 minimum between train and MTA monthly passes. Plus you gotta get to the train station. But he was able to do that. He was taking maximum loans each year and his parents took a loan for him to finish the last year. So the parents are paying and he is paying now that he is out after 6 years still living with his parents, paying off the loans and having little else He teaches at a private school which doesn’t pay that much. Needs more schooling to get certified or in the process to have a shot at a public school job. And the loans keep on chugging along, generating interest.</p>

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<p>Sybbie,</p>

<p>First, as I said, the publice sector jobs are very.very hard to come by.</p>

<p>Second, the benefit of loan foregiveness is MUCH greater outside of NY, Boston, etc.</p>

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<p>In this economy, a job in most fields are hard to come by.</p>

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<p>That is not necessarily true, because while housing may be less expensive in some parts of the country, salaries are also less, while there is not an appreciable difference in the cost of some items such as groceries, gas, milk etc. In addition, many parts of the country do not have an extensive mass transit system, so having a car and all of the expenses associated with having one are a must.</p>

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<p>(Just a side note the “student debt” figures reported by colleges and the media are mis-leading families, too. They are HUGELY under-reported because they don’t inlcude parent debt and credit card debt that probably add up to WAY more than what actual student loans do.) </p>

<p>It is intoxicating and exhilarating to be part of the “prestige” school hype. My kid at an Ivy? My kid at “fill in the blank prestige private?” The brochures are glossy. The campuses are beautiful. The alum are famous. Who wouldn’t want to be part of that? And a 17 year old is vulnerable to the hype. Parents want to please their kids and they want the prestige, too. </p>

<p>If you want to ruin your life by getting 100-200K in debt for undergrad, be my guest. Just don’t whine about it later to me. </p>

<p>For those who get into significant debt for undergrads at publics, again, a choice is made. Community College IS a choice. If you turn you nose up at a community college and instead go into massive debt for a sleep away experience at a public, again-- it’s your choice. Just don’t whine about it later. </p>

<p>The parents and the counselors need to do a better job of educating their 17 year olds about costs and debt and reality. The adults are absolutely to blame in all of this. No 17 year old can get into that much debt without a co-signer. </p>

<p>As for me, thank goodness my D had a great full tuition offer from a great school that she loved. (AND she has a good head on her shoulders and would rather I pay for grad school than undergrad.) Otherwise, it is likely WE would have been sucked into the Ivy prestige trap looking at 160K+ debt. It was a VERY hard decision to make because it is so easy to get caught up in the hype and prestige. All of our friends -and hers, too- were saying things like, “It’s a once in a lifetime opportunity!” and “Who turns down an Ivy?” Of course, they aren’t the ones paying the bills. </p>

<p>JUST SAY NO! Make better, informed decisions, and if you buy into the hype and sign the loans-- it’s all on you.</p>

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<p>^ Just a note: our counselor knew zip about finaid; small school, one counselor with all the resp. So we were referred to the state college funding advice folks. At that point, I had run a very cursory Fafsa EFC, to see more or less where we might stand. So, I went down to the support folks and get this whopping answer: COA minus anything the school gives you is what you pay. You can get Staffords. If you are low income enough, you can get Pells, whatever.</p>

<p>Me: but, this EFC clearly shows we are way ahead of Pells. It shows waaaaay more than we can afford. If we get aid based on that, if we get less than the remainder, no matter what scenario, we can’t come up with even this “Fafsa EFC.”
Them: then you get loans.</p>

<p>I am a savvy sort. Just imagine how this rings for families that aren’t or that assume or trust.</p>

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<p>Our school’s counselor also knew nothing about financial aid and COA and EFC, etc. Very frustrating. If she had even hinted that we wouldn’t be able to afford some of the colleges that D applied to, we would have changed our strategy early on. Again, we lucked out because D was offered a full tuition scholarship–but that was not a strategy that we were responsibile for–it was luck. I love what I see on some of these CC threads–schools with guaranteed merit, etc. Wish I had seen them last year this time. Counselors should provide these lists to parents. And I will take some of the blame, too. I should have done better research, too.</p>

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<p>Well, that’s kayf’s point, isn’t it? Income-based repayment is based on income, not expenses. So, in a high-COLA area, you have a higher income - and thus higher monthly loan payments . . . and also much higher living expenses. In small town South Dakota, you’re income is lower, so your monthly payments are lower . . . and it doesn’t cost nearly as much to live, so you can manage just fine. Cost of living absolutely does make a difference!</p>

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<p>Thank you dodgers mom. My point is that low cola areas will result in much more benefit under the debt foregiveness programs, even if the disposable income of two grads is the same. I think to count on these programs even being around 3 years from now is a gamble, and certainly as to how valuable they may be.</p>

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<p>There are not that many former students getting a lot of loan forgiveness. Good for the the ones who do. I don’t think you can get those private loans forgiven, and certainly not the parent ones or the ones the parents took from their pensions and home equity.</p>

<p>A reason so many families buy into this borrowing is because it is often featured as an investment, an opportunity. I know my friend felt that way about it. They lived in a depressed town in Appalachia, and few jobs were available. Many of the young people were out there falling into the traps of bondage of other kinds, and she wanted her daughter out of there with peers that were not in such an environment. That it was going to cost more than $30K a year, and it was going to take her 54 years to do it was not an issue. THe push was in getting her out of there. That the family business failed as well as the marriage was ever more the reason it was a good decision. </p>

<p>But now there are 2 more of college age, they are all borrowed out and the outstanding loan amounts are growing. THe graduated student is working at a coffee shop. Can’t buy a home, a car, and neither can mom or dad who have the laons on wahtever rag of a credit file that;s there. The other two are going to community college, and the sky has not fallen in. They are probably the flushest ones in the family right now, thanks to PELL and other monies.</p>

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<p>^^ CaliMom</p>

<p>Just say no?</p>

<p>Exactly!</p>

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<p>When you have reasonably fancy diplomas hanging on your wall, it is truly difficult to accept that your child’s diplomas won’t be nearly as fancy. I am so glad that I ran the EFC calculators early enough to get my guilt and angst under control. It took me all of Happykid’s 9th grade and most of 10th to get over myself. By the time 11th grade rolled in, I could accept our financial limitations with (relative) equanimity. Do I ever feel jealous of those who have the wherewithal for College X? Heck, yeah! But Happykid doesn’t (she’s always been much nicer than I am). Even though we’ve avoided significant college debt, I do understand the temptation to take it on in order for your child to fulfill his/her/your dream. Getting real about money and staying real about it is hard.</p>