QuietLurkingMom

Discussions on CC regarding debt usually turns into arguments about students and parents insisting on private "sleep away colleges" instead of state schools. Yet those I know who run into debt don't have the money for this "affordable" option either.

Parents able to pay in-state tuition/room and board usually have kids in the cat bird seat. Kid can hit the lottery with acceptance at the generous need-based schools, be awarded merit scholarships for private/OOS colleges or decide the flagship is the school for them. No matter: If costs are around what parent planned on paying all along, away the kid goes, debt free.

But for parents not in this position, this was never an option. State or private, it was going to be loans, loans and more loans. Even full tuition scholarships won't cut mustard if there's still room and board to pay. Where I live, neither the flagship or best regional college is in town. Yes, there's community college, but you still need a car to get to one (public transportation not being the best) and some kids can't afford that expense either.


QLM

cptofthehouse

I agree with you fully, Quietlurkingmom.

I have participated on both sides of the argument regarding going away to school, going to a highly selected expensive school vs staying home, working part time and going to a local state school or cc.

The answer is not a one size fits all blanket, but there is a point when the risks of borrowing so much money are higher than anyone should take regardless of the possibility of reward.

The truth is that sometimes it does all work out. We hear and read about the stories when they work out. Mom and Dad borrow for kid to go to college, Kid does well, enjoys every bit of the experience. Gets a great job right out of school as an engineer and can pay his loans back and some, Dad got a nice raise and bonus and the grandparents died and left an inheritance. So it all worked out. But for every story like that, there are kids who don't finish, don't stay in that major with the prospects of a good job, parent's jobs and pay levels go down, debt goes up and no one can pay back the loans after graduation which take a life on of their own with those interest rates. That's the scenario that most often happens.

sybbie719

Did she turn down a full ride at undergrad, because I doubt if there are many full ride med school scholly's without the student's commitment to work for a couple of years in a certain practice area after graduation. Ok, had she taken the full ride in undergrad, perhaps she would have less debt after med school. but there is no way she has 300k from undergrad, unless she has been in school a really long time or has constantly deferred loans.

I could see 200/300k debt for med school, especially considering the bulk of the financial aid is in the form of loans. It is still going to be hard to pay off because new doctors are not making big bucks.

lookingforward

Sybbie, sad to say, she turned down the full ride for med school. Her EFC for m/s was high, because they took parental income into consideration- one parent had recently (one could say, finally,) gotten a competitive paying job.

Her specialty will not allow her to dispatch the debt quickly. And, she is locked into this area, for family reasons. Breathtaking, eh? I wonder if some practices help new docs pay off school loans-? Don't some tippy top law firms?

weatherga

Heartily agree. We are in a big metro area (Atlanta) but the state flagships (UGA or Georgia Tech) aren't commutable. There are some commuter schools and community colleges, but a suburban resident needs a car to get to any of them. Public transportation in my middle class suburb is not merely poor, it's non-existent. Nearest transit stop of any kind is 6.5 miles from our house, and this is an "inner" county, not the exurbs at all.

Even after the state full-tuition (Zell Miller) or 90% tuition (HOPE) scholarship, the out-of-pocket cost of a freshman year at UGA or Ga. Tech is in the $12K to $15K range. This is a lot to borrow, and I strongly suspect some of D's peers and their families are borrowing much or all of it, probably unwisely. Others are commuting to community colleges and local universities.

sybbie719

Wow, full rides to med school are pretty rare. I thought if you committed to work in underserved communities that you can get some of your debt relieved. try this

http://services.aamc.org/fed_loan_pu...TOKEN=34526630

With new grads at tippy top firms making $160,000 out of law school (provided that they pass the bar), they will be able to pay off their own loans .

Many top schools will have LRAPs (loan repayment assistant programs), where depending on your salary, some of your debt will be paid by your school.

List of Law School LRAPs | Equal Justice Works

Some schools will give you free tuition if you commit to work in public service (5-7 years).

There are also

Public Service Loan Forgiveness
Where if you work in public service (non-profit/govt, etc) for 10 years while making your payments, you can have your loans forgiven.

Income-Based Repayment
where you can substantially reduce monthly student loan payments if you have high debt relative to your income.

kayf

The law school foregiveness isnt working.

1. "Public service" jobs are not easy to come by.

2. Income based doesnt work in high COLA areas -- its only adjusted for Alaska (maybe Hawaii). Works OK if you are in Ga or Miss, not Wash, NY or Boston.

kayf

I think borrowing is likely worth it for people at Gtech, especially if in engineering.

momofthreeboys

I think it's a highly case by case basis who much if any to 'borrow' about the federal direct loans. I wonder sometimes if these kids with >$50,000 debt are actually kids who were expected to pay off loans parents co-signed or took out. But the reality is a newly minted engineering grad is going to make $50000 to $60000 which is a significant salary but still will only support a certain level of debt and certainly not debt that approaches $100,000 and will be dependent on the cost of living in the area the newly minted grad is employed. Starting salaries do not differ all that much across the country.

lookingforward

Isn't the income based repayment schedule just a lengthening of the term- with interest growing, based on that extension? I don't know what this doc's plans are. But, she's a good warning point. She's the proverbial "wanted to be a doc" since, oh, ten years old. Everyone's shining light (and, she does deserve that.) But, as with many families, they let that light blind them.

I really think judging your kid's earning potential at 17, when he applies, or a few months later, when he accepts an admit, is terribly risky. Even for a kid who wants engineering. Starting salaries CAN differ depending on where you get hired, willingness to move, etc. And, my understanding is that salaries for engineers (except entrepreneurs or those who land Silicon Valley level,) can top out.

seaside22

What is your major/career goal?


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.


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?

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!

"$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.

mom6350

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

lookingforward

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

tptshorty

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?

annasdad

Who are the students in massive debt?

Simple answer, IMO: those with clueless parents.

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.

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.

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.

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?

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.

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.

This conversation:

"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."

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

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

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.

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.

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.

So I repeat:

Who are the students in massive debt?

Those with clueless parents.