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Shocking college debt figures. Not for students but for parents!Please be careful with your advice.

privatebankerprivatebanker 5840 replies86 threads Senior Member
So many school x elite with costs vs solid school b but more financially savvy posts than ever. These decisions are life changing for families. Don’t be flippant or immature with elite at all costs. Shocking and scary
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Replies to: Shocking college debt figures. Not for students but for parents!Please be careful with your advice.

  • cptofthehousecptofthehouse 29928 replies59 threads Senior Member
    Do they even include loans co-signed with the student? Those are cropping up when the students fall behind.
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  • privatebankerprivatebanker 5840 replies86 threads Senior Member
    @cptofthehouse

    Yes. These are arranged as such. Co signed and then student doesn’t pay. Unexpectedly large bills then fall on them. Or if the child becomes disabled or unemployed.

    It is very avoidable in most cases. The numbers are staggering to me.
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  • threebeansthreebeans 757 replies36 threads Member
    edited May 2019
    The billionaire commencement speaker - the amount he plans on paying for one graduating class of one college is reported to be $40 Million! If we multiply that out it proves @privatebanker is right to be worried about what this means for all of our futures. What are the odds of the next generation being financially fit enough to pay their own way. IDK what the solution is aside from a lot more financial
    education a lot sooner.
    edited May 2019
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  • bluebayoubluebayou 27090 replies176 threads Senior Member
    private banker:

    do you have the source for this report?
    The numbers are staggering to me.

    Yes they are, but does the source separate grad & undergrad debt? (GradPlus loans have been growing exponentially.)

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  • Mwfan1921Mwfan1921 3299 replies62 threads Senior Member
    edited May 2019
    Here is the most recent trends in student aid report. Busy right now so can't highlight the takeaways, but this is much of the cold hard data, with some good interpretation. Loan data and charts sprinkled throughout.

    https://trends.collegeboard.org/sites/default/files/2018-trends-in-student-aid.pdf
    edited May 2019
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  • Erin's DadErin's Dad 33343 replies4074 threads Super Moderator
    This report by AARP seems to have the data referenced in post #1.
    https://www.aarp.org/content/dam/aarp/ppi/2019/05/the-student-loan-debt-threat.pdf
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  • MadcityParentMadcityParent 61 replies0 threads Junior Member
    edited May 2019
    Does it specify whether the debt is for their education or for their children's education? I know a number of people who got caught by interest capitalization and are still trying to pay off their own students loans in their 50s.
    edited May 2019
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  • cptofthehousecptofthehouse 29928 replies59 threads Senior Member
    I’m seeing this hit families that can’t afford this burden. Kid takes out loans, parent gladly co-signs like it’s a car Loan or for an apartment.

    Then the parents hit a job or health slump. Or divorce or other crisis. They retire, maybe early maybe on disability. Then these loans come up when the former students hit hard times. They can even go after social security , tax refunds, etc for these loans.
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  • ucbalumnusucbalumnus 80169 replies720 threads Senior Member
    How much of these loans are for professional school (e.g. medical, law, dental, etc.) versus undergraduate?
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  • MadcityParentMadcityParent 61 replies0 threads Junior Member
    @Erin's Dad That link answers my question. It looks like most of the over 50 crowd with debt are dealing with their own debt. From the AARP article:

    'Most older borrowers hold loans taken out for their own education rather than for their children’s education. In 2015, 5.3 million student loan borrowers ages 50 and older had outstanding federal student loan balances for their own education, compared with approximately 2.2 million Parent PLUS borrowers ages 50 and older.'

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  • cptofthehousecptofthehouse 29928 replies59 threads Senior Member
    Ones I know signed for their kids.

    I often say that the Direct Loan for the kids and limit the parents to the same amount at most. And to take it from PLUS and start paying on it ASAP.

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  • CreeklandCreekland 5892 replies90 threads Senior Member
    I bet many of those older folks with their own debt were returning to get a college degree due to hitting a ceiling at their job or wanting to switch jobs. I know a fair number who hit that ceiling - no idea if they took out loans or not, but considering oodles of Americans can't afford a $4-500 emergency it wouldn't surprise me.
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  • DadTwoGirlsDadTwoGirls 5986 replies1 threads Senior Member
    "And the 870k debtors over 65 with such high defaults have to be grandparents."

    There are some parents over 65 with kids in university. Also, a parent that takes on debt at 55 to put their child through university might still have some debt at 65.

    I would however agree that quite a few of these are probably grandparents. Of course it is a problem either way. Paying off a significant debt after retirement is not likely to be practical.
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  • privatebankerprivatebanker 5840 replies86 threads Senior Member
    @creekland. That could be.

    However. To be motivated enough to take on take on significant debt that late in life to attend college or grad school and then default. I don’t know.

    My guess is many are grandparents co-signing loans for bright children they love and neither understanding the long term issues that it can cause.

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  • Mwfan1921Mwfan1921 3299 replies62 threads Senior Member
    My guess is many are grandparents co-signing loans for bright children they love and neither understanding the long term issues that it can cause.

    I thought most banks cap the age of co-signers (thereby keeping grandparents out of the mix in many cases)?
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