Disclosing Income to Child ...

NikkiiL
Sat, 16 Jan 2010 12:34:14 +0000

Roman,

Based on the repayment information and the fact that the loans were not in defaut, I would have to assume the parents did pay the undergrad loans themselves. But, as kelsmom said, if the child isn’t taught responsibility by the parents, how are they going to navigate college or the real world after college?

Even though in many instances, the parents will be the ones footing the college tuition bill, the reality is that it is the STUDENT’S financial aid package…it is their responsibility to make sure everything is submit correctly and timely. Why? Because it is THEIR name attached to to the college bill. The student’s name is the one on the FAFSA, the student is the one enrolled at the school…if wrong information is submitted (purposely or accidently) it is the student who can pay the consequences if aid is later revoked. If the college bill isn’t paid, it is the student that the collection agency will hunt down and it is the student’s credit that gets ruined.

Yes, that is a lot of weight on an 18 year old…but if they are shouldering at least some of the responsibility when the paperwork is completed, they know what is going on and know the potential consequences. It doesn’t mean that the parents should just toss all the financial information to the child and say “get it done”. Instead, the parents and the child should sit down together and work through the FAFSA and Profile. Then the parents and child should review ALL the college paperwork together: loan applications, entrance counseling, award letters, scholarship letters, etc. Sit together with a loan repayment calculator and show the student how much they will REALLY have to make to repay the loans that are necessary for the chosen school. Heck…the reality is if they see the parent financial portfolio, it may actually give them a good idea of what it takes to be as successful as the parents are. You may even find the children become more respectful and appreciative of the sacrifices you have made for them.

My kids are 16 and 12. They both know how much money comes into the household. They both know what are required monthly expenses are. They both understand what it takes for me to provide them their cell phones, camp fees, sport fees. They know how I have to juggle finances when it comes time to purchase that “I MUST HAVE IT” $300.00 prom dress. They know what responsibility they must shoulder in high school if they want to attend their dream school because they know what our financial situation is and how little finances are available to cover any gaps in aid. They also know that Parent loans are out of the question because of the amount of income and expenses already undertaken by the household.

All all the parents should already understand…the REAL world is an ugly, difficult, no excuses world. Not understanding how things work doesn’t buy anyone any excuses. Being young doesn’t buy anyone any latitude. Being only 18 doesn’t buy anyone any real compassion for real world immaturity.