Tuesday, April 17, 2012

Would we do it again?

College for the kids. It's one of those many things that we didn't plan for. I mean, we planned for them to go, we just never really thought through how we would finance the plan.

When the older two started working part-time and summer jobs in high school, we did tell them that they would be responsible for books and spending money for college, but it was presumed that we would be footing the bill for tuition, room and board. Our parents paid for our college educations and we both graduated without the burden of a student loan. We didn't appreciate then what a blessing that was.

When it came time for DD to start college, she had her heart set on a private school one city over. She received a sizable academic scholarship and pulled together a couple of other small scholarships, but we were still left with a pretty big bill. And that's when we started the slippery slope of college loans.

All of the student loans listed in our debt log are for the education of our children. The first two are Stafford loans in DD's name. The last two are dreaded Parent Plus loans. We made a deal with the kids that if they graduated on time and in good standing, we would make the payments on their Stafford loans. DD did just that. DS1 only lasted one year in school before deciding it just wasn't for him. As agreed, he has assumed payments on his Stafford loan.

DS3 will be able to cover most of his college costs with his disability payments, and he will live at home which will keep costs down. Still, we're left with thousands of dollars of student loan debt from his siblings.

Did we do the right thing? Should we have taken out loans to pay for their college? Should we have insisted they foot the bills themselves? I don't know. Our niece was not given any help financing her education and she worked 40-hour weeks while taking a full course load. After three years, she burned out and dropped out, leaving her with three years worth of loans and no degree to show for it.

Where do we draw the line? And is there such thing as good debt? My daughter has taken her degree, gotten a good job in her field and has been self-supporting since a couple months after graduating. I believe our investment with her was a good one. DS1 left us with a Parent Plus loan and has nothing to show for it, but he is working, paying his bills and finding his way. For him, college wasn't it.

It's a hard call. And even now, I don't know that we would do anything differently. But it sure would be great not to have those student loans staring us in the face every month. One day. One day...

Sarah


8 comments:

  1. We didnt take plus loans out for the kids because we just cant afford the payments. They do have regular loans, applied for grants and worked pt during school and full time during the summer.

    We helped with books, and anything else we could but not plus loans. In the end we all decide what is best for our kids and ourselves so I dont think there is a right or wrong answer

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  2. I took out pp loans for the 2nd one for hygiene school. She is paying this back. Our first went full ride and we did not pay a dime. We are helping the youngest but we will do it with cash payments through out the year. It is a tough call. My husband and I got no parental support through college and I really resented it. I do think kids need help or they don't make it. You niece is a perfect example. But it is slippery slope. I will never take out another PP lone. The interest is just too high. I am right there with you sister. I just learned a little earlier. Luckily our two oldest have very good paying jobs. Heck they should be helping us! :)

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  3. Kazi had scholarship money for her first year and then I paid half and she paid half for the next 3 years. She has a small amount in student loans but she is already paying that off. She works 2 jobs though one is just an occasional shift now and then. She has 3 exams this week and then she is done university FOREVER (maybe haha). Then one year of post grad at a local college. Then hopefully a CAREER!! She plans to live at home while working for a year or so to get all her remaining debt paid off and save up some $$. I just hope her plans all work out. I agree there is no right or wrong, there is only what works for you and your family. Each case is different. I`m so happy that your DS3 will be able to both attend college AND maintain your support at home - he`ll have the best of both worlds.

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  4. When I read about the amount of debt accrued to study in the USA and Canada it makes me appreciate the system here in Australia.
    Yes you can got the Private University way if you have wealthy parents that would be excellent, but for the majority of Australians the government pay you through University using HEX this is paid back by the student once they start to earn over a certain amount, it is added to your weekly tax amount. If they never work they never pay it back, so if they ever find themselves out of work, it is not a sword over your head.
    This also means parents don't get the bill and as the tax amount varies according to the amount earned the students find it affordable.
    Both of my kids pay back their Hex and don't struggle at all, plus it makes no difference to their credit scores....

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  5. I can only speak from my own experience, but my parents paying for my college was just not an option. I also attended a private college, but through a combination of scholarships & working full-time throughout the entire 4 years, I graduated with a fairly minimum student loan debt. ($15K, I think)? My parents did pay off another loan of about $2.5K when I graduated.

    Fast forward 15 years, & my parents are looking at retirement, & I'm so happy they are not burdened with student loan debt from me. I paid off my loans about 3-4 years after graduating from college, & then financed an MBA myself a few years later. My situation is relatively unique because I graduated in an entirely different job market than students face now.

    Our plan is to pay for our kids tuition, and potentially room & board. We'd like them to work part time for spendign money, & we'll go from there.

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  6. Sarah,
    Do you think that your daughter (with the good job) could help pay back some of her loans? It's not ideal, but you are hammered with student loan debt.

    We paid half of our older daughter's public college education (came to about $7000 a year). No loans. We may not be as fortunate with the younger two...they are only a year a part. We will only pay for 1/2, and only if we can pay cash. They will have to look for scholarships and work. I always thought that I would pay for their college educations in full, but with retirement around the corner, that just may not be possible. PLUS, it is now about $22,000 a year for a public college education! Ugh.

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  7. I think 30 years ago it was more reasonable to pay for your kids college but these days the cost for a year of school is way out reach for the average parent. When my friend's daughter decided to go to college we helped her apply for a massive amount of scholarships so that she wouldn't be burdened with debt when she graduated.

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