One can think of college as 'breakfast' for young adults and a mortgage as 'lunch' for middle-aged adults. Because the federal government via the Federal Reserve has made 'lunch' artificially cheap, 'breakfast' has been made more expensive.
College tuition has gone up 1400% since the 1970s because colleges knew they could charge anything they wanted and the dumb 18-year olds they exploited would take out the government loans and hand it over to them.
https://www.in2013dollars.com/College-tuition-and-fees/price-inflation
I graduated in 1977 with $10k + student loan. My first job paid $11400 a year. That was normal for the time. Your loan was about 1 years starting salary.
One has to wonder about the wisdom of paying 100s of thousands of dollars to learn to do a job paying $15 an hour.
In 1986 I bought a house with a $77,000 mortgage at 10 percent. That's $209,866 in today's money.
I drove a used car until 1987, so no payments there. Got married in 1987 which helped with the debt burden. She had a paid off car too.
Today's young adults have bigger student debts, pay rent, pay car loans, and stay single. Too bad for them.
Add to this, the ability to take out loan after loan for a degree in Underwater Basket Weaving.
Kids are leaving college with loans in the 6-figures to get a Masters in Social Work. To get a job that pays what? $30-40,000 a year to start, so they can help people. And all they do is help do nothing more than providing paperwork for Section 8, WIC, SNAP, etc. Who needs a Masters degree for that?
Same can be said about so many degrees offered these days.
You’re all a bunch of suckers. In 1978, after high school, I joined the Navy and THEY paid ME! And, they’re still paying me 43 years later!
(I should point out that the above is a joke. I do not, in reality, believe that you, or anybody else on this thread is a sucker. The above post was in jest, and is not meant to insult anybody or hurt anybody’s feelings. I feel I need to post this disclaimer these days.)
I quit college because I was too immature and wasting my father’s money. I joined the Air Force instead. By the time I finished my 20 years, I had two associates, one BS in Technical Operations, and two MS in advanced aerospace and spacecraft engineering. My total student loan debt? $0. I do not have any sympathy for the snowflakes with massive debt on degrees to nowhere. Every time I hear them complaining, I ask for more fries with my burger.
“A Direct PLUS Loan is commonly referred to as a parent PLUS loan when made to a parent borrower.”
“The maximum PLUS loan amount you can borrow is the cost of attendance at the school your child will attend minus any other financial assistance your child receives. The cost of attendance is determined by the school.”
“For Direct PLUS Loans first disbursed on or after July 1, 2020, and before July 1, 2021, the interest rate is 5.30%. This is a fixed interest rate for the life of the loan.”
“Loan Fees for Direct PLUS Loans
First Disbursement Date Loan Fee
On or after Oct. 1, 2019, and before Oct. 1, 2020 4.236%
On or after Oct. 1, 2020 and before Oct. 1, 2021 4.228%
Loans first disbursed before Oct. 1, 2019, have different loan fees.”
“The school will first apply parent PLUS loan funds to the student’s school account to pay for tuition, fees, room and board, and other school charges. If any loan funds remain, your child’s school will give them to you to help pay other education expenses for the student. With your authorization, the school can pay the remaining loan funds directly to the student.”
https://studentaid.gov/understand-aid/types/loans/plus/parent
“What are the eligibility requirements for a parent to
get a Direct PLUS Loan?
• You must be the biological or adoptive parent (or, in some cases, the stepparent) of the student for whom you are borrowing.
• Your child must be a dependent undergraduate student who is enrolled at least half-time at a school that participates in the Direct Loan Program.”
“Generally, your child is considered dependent if he or she is under 24 years of age, has no dependents, and is not married, a veteran, a graduate or professional degree student, or a ward of the court....”
“The repayment period for a Direct PLUS Loan begins immediately after you’ve received the last disbursement of the loan, while your child is still in school. However, you may be able to defer making payments while your child is enrolled at least half-time, and for an additional six months after your child graduates or drops below half-time enrollment status.”
“We charge interest on Direct PLUS Loans during all periods of deferment and forbearance.”
“You must repay your Direct PLUS Loan even if your child doesn’t complete or can’t find a job related to his or her program of study, or if you or your child are unhappy with the education you paid for with your loan. However, we will discharge (forgive) your loan if
• you become totally and permanently disabled (inaccordance with ED’s definition);
• your loan is discharged in bankruptcy after you have proven to the bankruptcy court that repaying the loan would cause undue hardship; or
• you die, or the child for whom you borrowed dies....”
https://studentaid.gov/sites/default/files/direct-loan-basics-parents.pdf
Next, the Democrats will offer free tuition. Students will have a Doctorate in Critical Race Theory with a Masters in Revolution or in Transgender Studies. They will then be given generous welfare and housing as they riot and burn down cities.
My son graduated high school ten years ago. Got on an electrician apprentice program. Now, he has passed the state journyman test, and the state master electrician test, and the state electrical contracters test (michigan). He drives a brand new company 4x4, new cell phone and lap top every year, brings in six digits plus, he is at 28 the onsight boss at the job. NO STUDENT DEBT, EVER. College is a rip off.
Part of the whole college cost discussion, has to do with how expensive private universities have become. And another is the expectation so many have to go away to college.
In both cases, families would save a lot of money, if their students went to a local public college or university, and lived at home while doing so.
Also, with technology having developed as it has, there should be more opportunities for online learning and courses, which hopefully would be a lot less expensive.
My first house was purchased in 1980 with an FHA-subsidized loan at 12%. Prevailing mortgage rates were higher - more like 15% if I’m remembering correctly. It was brutal, and inflation and unemployment rates were also very high when I graduated from college. However those conditions were anomalous for the US economy. The Jimmy Carter era of malaise and stagflation yielded to Ronald Reagan’s reforms. The advantage we had in those years was that mortgages could be refinanced once rates dropped. It wasn’t overnight, but gradually they improved. The houses we purchased in 1987 and 1993 were both refinanced as rates dropped. We started out around 12% and ended up around 5%. Today they’re even lower. It was no picnic, but I’d rather have a smaller loan that can be refinanced than to carry the massive balances young people face today.
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I completed my BS & MBA in 80s via student loans, scholarships & part-time positions as undergrad teacher/tutor...all while being a single parent with two pre-teen daughters.
Somehow I managed to earn national academic honors and eventually repaid the loans in full + a whole lotta interest.
That said...
I truly despise the movement to forgive student loans as the “students” were old enough to grasp the economic impact when they received their loans. It was not a gift from taxpayers.