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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308544  
Subject: How we raise our children Date: 3/21/2011 11:18 AM
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It’s not what you say, it’s what you do that your child pays more attention to. As we struggled with our debt for most of his life, we had discussions, sometimes stressful ones, about it. He must have been taking it all in without us even noticing. Until a couple of weekends ago I had no idea of how he was feeling.

We talked about college and the costs and the following discussion ensued:

Me: ‘You’ll be filling out scholarship forms, and we have the FASFA form filled out and we’ll find out how much in grants and loans….’

Dash: ‘No loans! I’m not going into debt for college.’

Me: ‘Good idea. I agree with you about that. Then we need to figure out what you can afford for college and how it will be paid. We have some money saved up for you, but you might pick a college that costs more than that. What would you do?’

Dash: ‘If I have to go to community college for 2 years I’ll do that, then transfer to a 4 year college and use the money you’ve saved. Maybe I’ll go into the military and they’ll pay for my college.’

Me: ‘That’s a good plan, but remember that if you change your mind about the military after you have graduated, at the very least have to pay them back for it – I don’t know for sure about that, we’ll have to check. If I were you I’d think about getting your college degree then joining the military afterwards. That way you have the most flexibility. You might also think about part time jobs.’

Dash: ‘I’ll think about it. I just don’t want ANY loans! I’m never going into debt for ANYTHING!’

I don’t think it’s JUST our situation he’s reacting to; he has some friends and acquaintances whose parents have lost jobs over the past few years, and he sees their stress level and how it’s affected their lives. I think that this generation of students in high school will have a very different idea of life than what I did growing up. And I think it’s a good thing.

Andrea
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Author: Fuskie Big funky green star, 20000 posts Top Favorite Fools Old School Fool Ticker Guide SC1 Red Winner of the 2010 Rule Breakers Challenge Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301455 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 11:56 AM
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It's great that he is wise enough to not want to fall into the trap that so many fall into, but as he matures into an independent adult, I hope he will come to realize that not all debt is bad and that debt managed wisely can work for you.

Fuskie
Who agrees that this generation, especially those who have become more world-aware during the last decade, will have a very different outlook on just about everything and all we can hope is that we live to see their happiness...

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Author: tconi Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301456 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 12:14 PM
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my children were raised grass fed.


peace & price per pound
t




not staying on topic

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Author: ishtarastarte Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301457 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 12:20 PM
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my children were raised grass fed.

I know the elf eats butter. Didn't realize he eats grass, too.

:P

Ishtar

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301458 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 12:26 PM
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It's great that he is wise enough to not want to fall into the trap that so many fall into, but as he matures into an independent adult, I hope he will come to realize that not all debt is bad and that debt managed wisely can work for you.

Thank you, Fuskie. I think he'll eventually come to that conclusion. What I notice about him is that his position softens as he comes to trust himself and his judgment. I just think it's great that he thinks about things like this!

Andrea

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301459 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 12:28 PM
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my children were raised grass fed.


peace & price per pound
t


LOL He was raised organic, but switched to the hot dog belief system....

Andrea

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Author: MetroChick Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301460 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 1:10 PM
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I'm currently reading Christine Roman's "Smart is the New Rich" (borrowed from the public library) and highly recommed it for your son to read.

There's nothing Earth shattering in it, but it does explain how we got into the current state of the economy, and the difference between using debt wisely - and even the difference between "good" student loan debt (when it's a manageable amount that lets you prepare for a profession you're interested in with good employment prospects) and "bad" student loan debt (what happens if you quit school after taking on loans, or decide a profession you got a lot of debt for isn't for you).

I think it's great he wants to be careful of taking on any debt, but from what you've described it sounds like he's operating from a place of fear, and reading this book might help him see how he can make sound decisions without being fearful.

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301461 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 1:24 PM
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I think it's great he wants to be careful of taking on any debt, but from what you've described it sounds like he's operating from a place of fear, and reading this book might help him see how he can make sound decisions without being fearful.


I'll take your advice on getting the book, thanks for that info. :) He is fearful, which makes him super-cautious.

Andrea

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Author: SeattlePioneer Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301462 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 1:25 PM
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<<<<As we struggled with our debt for most of his life, we had discussions, sometimes stressful ones, about it. >>



<<Dash: ‘I’ll think about it. I just don’t want ANY loans! I’m never going into debt for ANYTHING!’>>



>>




You were giving HIM advice?



Seattle Pioneer

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Author: Fuskie Big funky green star, 20000 posts Top Favorite Fools Old School Fool Ticker Guide SC1 Red Winner of the 2010 Rule Breakers Challenge Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301464 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 2:08 PM
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Sometimes one can be too afraid of credit. I was chatting online this weekend with a friend who is 23 and he was asking me about why his debit card might be rejected when subscribing to a monthly online subscription service. I was trying to explain to him why using a debit card for such a service was not the best idea and that he should use a credit card instead. He said he didn't want a credit card because they were too dangerous. This led to a discussion on the dangers of both debit and credit cards.

Fuskie
Who notes he didn't realize that he had already established a history of good credit usage when he took advantage of a short term tuition loan through his university his freshman year...

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Author: tconi Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301466 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 3:55 PM
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In all seriousness, the boy is a bit debt averse, and at his 3rd year in college has taken out very little in the way of student loans.

I think part of the problem that these kids today* sometimes have, is that many of them (until maybe very recently) have only seen Easy Money.
Easy Money:
Where the parents get up, get dressed and go to ONE job that pays OK, has benefits and paid days off.

My kids have seen both Easy Money (now, even though I do have 1 FT and 2 side jobs)
and Hard money - after layoffs/business closings (where I have had 2 FT and one PT job and still struggled to make ends meet)

I think first hand experience of Hard Money, growing up, makes a person a little more cautious as an adult about where to incur debts.


peace & comparisons
t





*get off my lawn

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Author: ishtarastarte Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301467 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 4:03 PM
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I think first hand experience of Hard Money, growing up, makes a person a little more cautious as an adult about where to incur debts.

I think so, too.

As related elsewhere, C recently declared that she didn't want any student loans because she heard they're really bad. Then asked me if it would be ok to take out just enough to cover books, because she heard books were expensive.

This lead into a great discussion about different kinds of debt, interest rates, and bankruptcy.

Ishtar

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Author: bill343 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301468 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 4:39 PM
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I know the elf eats butter. Didn't realize he eats grass, too.

Butter is made from

Milk

which is made from

Grass....

it's all good....

bill

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Author: SeattlePioneer Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301469 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 5:03 PM
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<<This lead into a great discussion about different kinds of debt, interest rates, and bankruptcy.

Ishtar >>



That loan for a textbook puts you on the road to perdition...



Seattle Pioneer

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Author: NoIDAtAll Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301471 of 308544
Subject: Re: How we raise our children Date: 3/21/2011 8:47 PM
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Dash: ‘If I have to go to community college for 2 years I’ll do that, then transfer to a 4 year college and use the money you’ve saved. Maybe I’ll go into the military and they’ll pay for my college.’


If he starts out at a community college, he will need to check that the credits will transfer to the 4-year college that he chooses - not all will.

Boy, I am glad that I got college out of the way many monns ago!! My first year, cost $80.50 per quarter for a full load. By the time I graduated, the cost had increased to $111. I think the cost is around 30-40 times that now, 40 years later. Yes, the college was accredited <g>... I landed offers to work for Price Waterhouse, Touche Ross and a couple of other International CPA firms - It blew my mind how challenging working for one of these firms would prove... Sleep, what's that? Pressure, what's that - "We hired 40 people last year. 12 are left."

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Author: joycets Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301474 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 4:39 AM
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So, what about a Dashing Running Scholarship?

joycets

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301475 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 8:25 AM
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So, what about a Dashing Running Scholarship?

joycets


We've been looking for track scholarships and they are for the Division 1 or Division 2 schools. You know, the ones that cost $30,000+ per year..... So we keep looking....

Andrea

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301476 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 8:54 AM
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If he starts out at a community college, he will need to check that the credits will transfer to the 4-year college that he chooses - not all will.

That figures heavily into our discussions, NIAA. I went to junior college in Texas when the concept was pretty new and made sure all my credits would transfer to a 4 year college. I can relate about the cost of college; I had mine all paid off by the time I graduated, partly because I worked as a secretary at the University.

Andrea

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Author: alstroemeria Big gold star, 5000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301477 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 9:02 AM
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paying for college

Just a side note here. My daughter is very conscientious and was very proactive in searching for scholarships. She found a local square dance group who gave $1,000/year or maybe per semester, I forget ( for all 4 years IIRC) to a couple of graduating seniors, and she managed to win one. It may not sound like much, but our deal (her father & I were divorced) was that each parent and child was responsible for 1/3 of college expenses* with need-based aid shared equally but merit-based aid coming only out of the child's portion. She was a merit scholar and had that square dance thing, and as she went to a relatively inexpensive private college (RIce U--lots of oil endowment so even full freight was about the same as one of the expensive public colleges). DD also worked during school year as well as summers. She owed $3,000 when she graduated, and paid it off within a year of graduating.

My son wasn't so proactive and didn't work during the school year and worked very low-paying jobs over the summers (camp counselor), started out at an expensive private college and received little financial aid (he transferred to a very good public college after 2 years--and got terrific grades at both, I hasten to add), and owed $20k when he graduated. But he has payments taken automatically out of his bank account and just pays the minimum because the rate is so low--and it gets lower every few years with his on-time payments. IIRC he's paying ~$180/month.

* I paid for her computer and books because I was in better financial shape than her father since both my second husband and I worked, while her step-mother was a sAHM with 3 kids of her own, and they had CC debt. Her father had to pay his share by borrowing from his 401k, while I had already saved one year's worth, and the rest came out of investing the full amount allowed in my company ESPP so every 6 months for an automatic 15% profit (taxed at marginal rate, but still a great benefit which I believe is hard to find now), I'd have the cash safely in my checking account to write checks for school. I did have one year where my kids were both in college, and that was a bit tighter for me so I eliminated most discretionary spending that year. Then my share of of my son's college was much larger--luckily I was making more money. (My ex has pretty massive debt at this point, but I hate to say that he's "lucky" to be getting an inheritance this year large enough to pay it all off, probably including his mortgage--his father died, but he was something like 102. It's a terrible thing to be in such debt at age 62. Without this inheritance, he'd be looking at not being able to retire. His wife never did go back to work, which puzzled me until I learned that she's likely to get a large inheritance, too. Kinda weird to count on the death of loved ones to save one's bacon, but I wonder if that's more common that most people realize.

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Author: xtn Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301478 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 9:27 AM
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Hot dogs ARE organic.

xtn

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Author: xtn Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301479 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 9:30 AM
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Butter is made from

Milk

which is made from

Grass....


Please note that beef is also made from grass. All the -tarians may now enjoy a steak guilt free.

xtn

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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301481 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 10:54 AM
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We've been looking for track scholarships and they are for the Division 1 or Division 2 schools. You know, the ones that cost $30,000+ per year..... So we keep looking....

And my understanding from DD is that Div3 schools cannot give out athletic scholarships, so you may have to keep digging to see what else turns up.

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Author: yeilBagheera Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301482 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 11:00 AM
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Staying in state OR making a plan to obtain residency in the state you want to go to college in is a strategy to consider.

And I have a definite preference for living in a dorm at least for the first couple of years. It seems to me ever so much easier than fiding an apartment and transportation to and from campus.

DD went to a college that gave her college credit for the Advanced Placement exams she scored well on (5's as I recall). Thus, she had sophomore standing by the second term which was an advantage in registering for classes.

YeilB

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Author: Fuskie Big funky green star, 20000 posts Top Favorite Fools Old School Fool Ticker Guide SC1 Red Winner of the 2010 Rule Breakers Challenge Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301485 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 11:29 AM
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Shameless Plug: I started the Getting Your Child Into College board a few years ago. We don't get much traffic but I would love if you wanted to come over and give it a kick start discussing scholarships, loans and grants and such.

Fuskie
Whose nephew is trying to secure enough scholarships to go to his dream university next fall...

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Author: MetroChick Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301486 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 11:41 AM
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Staying in state OR making a plan to obtain residency in the state you want to go to college in is a strategy to consider.

For the residency option - one needs to verify what the college considers "residency" since at some colleges just having an off-campus apartment for a year or more does not qualify.

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Author: TchrP Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301487 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 12:31 PM
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We don't get much traffic but I would love if you wanted to come over and give it a kick start discussing scholarships, loans and grants and such.

There is a Paying for College board that, I think, gets more traffic, and it's specifically about "scholarships, loans and grants and such."

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Author: FiddleDeeDee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301488 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 12:33 PM
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Shameless Plug: I started the Getting Your Child Into College board a few years ago. We don't get much traffic but I would love if you wanted to come over and give it a kick start discussing scholarships, loans and grants and such.

http://boards.fool.com/welcome-to-getting-a-child-into-colle...

Thank you Fuskie. I had forgotten about that board! I put it on my favorites again.

Andrea

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301489 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 12:51 PM
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FiddleDeeDee: "We've been looking for track scholarships and they are for the Division 1 or Division 2 schools. You know, the ones that cost $30,000+ per year.."

The Athletic Division in which school competes does not determine the cost the of attendance at the school.

I could find plenty of D-III schools that cost $30,000+/year.

And as 2gifts noted, D-III schools do not give out athletic scholarships (nor do all D-I schools, for that matter). I do not know one way or another about D-II schools.

Regards, JAFO

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Author: utahtea Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301490 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 2:04 PM
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Dash: ‘If I have to go to community college for 2 years I’ll do that, then transfer to a 4 year college and use the money you’ve saved.

Both my younger son and his girlfriend (now his wife) went to our Community College for 3 years. DS worked part-time at a local grocery store while going to community college. Later when he was going to a near by University (still living at home) started a new full time job in his related field which helped pay for college and as soon as he graduated they offered him a new position.

My DIL went on to UC Berkeley where she graduated with honors in two years. She then went on to Stanford for her PHD where she received a full scholarship and stipend.

Moral of story, going to a community college can be a great start.

Utahtea

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Author: NCCPA Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301491 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 3:21 PM
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Smart kid. ALL debt is best to be avoided in my opinion.

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Author: joebedford Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301492 of 308544
Subject: Re: How we raise our children Date: 3/22/2011 6:10 PM
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Flame away, but as a college dropout/entrepreneur, I tend to disagree with the "student loans=good debt" paradigm. Maybe sometimes, but I have seen plenty of situations where it is very bad debt, indeed.

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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301493 of 308544
Subject: Re: How we raise our children Date: 3/23/2011 3:52 AM
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Flame away, but as a college dropout/entrepreneur, I tend to disagree with the "student loans=good debt" paradigm. Maybe sometimes, but I have seen plenty of situations where it is very bad debt, indeed.

What is large/excessive college debt does depend on income and the persons goals. A relative has some college debt. After finishing college it was at about 30-40% of her initial annual income. It will be paid off soon. It wasn't trivial, but not outrageous.

A co-worker has a child in an expensive college. The co-worker is covering miscellenous expenses, but tuition is completely financed by loans. I don't know how it will ever be possible to pay off the loans.

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Author: MetroChick Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301496 of 308544
Subject: Re: How we raise our children Date: 3/23/2011 10:56 AM
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Flame away, but as a college dropout/entrepreneur, I tend to disagree with the "student loans=good debt" paradigm. Maybe sometimes, but I have seen plenty of situations where it is very bad debt, indeed.

That's what I liked about the point in Christine Roman's "Smart is the New Rich" book - unfortunately the message that used to be out there was "student loan debt is ALWAYS good debt" -- people didn't analyze their situation and now that student loans can never be charged off in bankruptcy, it's very important to be careful of taking on student loan debt - making sure you want to finish a school program that you start, running numbers on how much debt you'll be taking on in total and what the employment outlook is.

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Author: alstroemeria Big gold star, 5000 posts Top Recommended Fools Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301497 of 308544
Subject: Re: How we raise our children Date: 3/23/2011 12:33 PM
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After finishing college it was at about 30-40% of her initial annual income. It will be paid off soon. It wasn't trivial, but not outrageous.

My son's student loan total was nearly 60% of his initial salary, which hasn't been a problem--from the first he saved 2-3x his loan payment into an ING account every month. But it's harder nowadays to land a good job right out of school. In retrospect, it was a bit risky. Borrowing one's entire tuition for 4 years could easily be 100-200% or more of one's initial salary. Seems a risk that's likely to pay off only for very conscientious students entering lucrative professions.

Young adults fresh out of school often feel they've earned brand new wheels and may easily have higher car payments than student loan payments.

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Author: vickifool Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301544 of 308544
Subject: Re: How we raise our children Date: 3/25/2011 10:44 PM
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Moral of story, going to a community college can be a great start.

I'm a huge fan of community colleges.
But here in California, they are starting to gut them.

Maybe Dash will get a scholarship because the college of his/her choice just wants him/her. My kid got scholarship offers and I'm not sure why. Great test scores, but spotty grades. Maybe they wanted a kid from California as much as Red wanted a college with snow.

Vickifool

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Author: tyrodtaylor One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 301563 of 308544
Subject: Re: How we raise our children Date: 3/28/2011 3:20 PM
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Student loans are a lot like mortgages... if used correctly/wisely and one goes in with a plan for the future (career), they can help you achieve something you'd never do without the loan. I think it is a good idea to get that point across to your child and don't let them enter the real world on either side of the extreme:

"I've ruined my life and become a slave to debt" vs.
"I don't want debt period, even if it means starting off at a disadvantage for my career"

find a happy median...

-T

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