Posted on 12/03/2020 5:08:28 AM PST by karpov
Poor and middle-income parents at hundreds of colleges have taken on substantial debt—amounts sometimes more than twice their annual income—to help their children through school, new federal figures show.
The schools with the largest parent debt burdens aren’t world-famous Ivy League schools, a Wall Street Journal analysis of the data found. Rather, they include art schools, historically Black colleges and small private colleges where parents are borrowing nearly six-figure amounts to fulfill their children’s college dreams, the analysis found.
For the first time, the U.S. Education Department, through its annual release of college financial data, provided information Wednesday on the level of debt parents took on through a federal college loan program called Parent Plus.
Previously, the department released information on debt levels of students at specific colleges and universities, but not the borrowing taken on by parents on a student’s behalf.
The Parent Plus data “provides a more complete financial picture of how recent graduates have paid for their postsecondary education, especially if their parents took on debt to help them cover some or all of the costs,” the Education Department said in a statement Wednesday.
The amounts may be burdensome for many parents. At nearly 150 colleges, parents typically took out loans worth $50,000 or more, the data show. At more than 500 schools, the median amount they borrowed was between $25,000 and $50,000.
Parents of graduates from Spelman College, a historically Black school in Atlanta, borrowed a median $112,000—more than any other school in the country, the data show. About half of Spelman parents take out the loans through Parent Plus. Paying that back would cost more than $1,200 a month, the data show. In most states, that is about the cost of a home mortgage payment.
(Excerpt) Read more at wsj.com ...
Student loans need to be means tested and able to be part of bankruptcy. Those taking out the loans need to prove the ability or future ability to pay them back.
A few years ago I was talking to a friend and asked how he was going to handle college costs.
He blithely said they were going to do all loans. When I objected to the wisdom of that he said they were interest free so why not. He was amazed to find out from me that they are certainly not interest free and for some, interest begins to accrue the moment you get the money. Theoretically you will be amassing four years of interest before making the first payment.
One of my kids took out some loans, both from me and the system. He went into a career field that paid enough to allow him to be debt free within a year.
Parents who take out parent plus loans are nuts. At least with student loans, the student is responsible and not the parent.
What is the point of posting this article if the WSJ is behind a pay wall. If you have a subscription and can excerpt it, why not excerpt the most pertinent part of the article, the list of colleges with the highest student debt?
I had a co-worker like this. Her kid was a marginal music major at a second rate university with ambitions of working at Disney. Mom thought her job was to help her kid “fulfill her dreams”.
My Daughter did her General Education at Community College at Night for free while working, then transferred to Radiology School, which was also FREE with the Grants and Scholarship she got, She already had a PAID for House that I bought for her with her inheritance when my Father died, I paid her living expenses for 2 years, about 25K.
She has a Great Job working in the Emergency Room, and can go to ANY Hospital and start work tomorrow if she wants to.
Right; only one of mine borrowed (a small amount, and is repaying it while in school), but my signature didn’t appear anywhere. That way, I can help make payments if I choose/am able, but won’t ruin my credit/lose my home if payment isn’t received.
For undergrad, a student can only take about $30,000 total without a cosigner. The ones who have more than that are either grad students or they are counting cosigned parent loans. There are thousands of colleges in the US. There is no reason to go into big debt. Schools in WY, ND, SD, AR and other states have lower rates and decent scholarships for decent students. The better the student’s stats, the bigger the scholarships.
So, far my daughter took a full ride, 2 nephews went with full tuition at their schools, and a niece is looking at full rides and full tuition offers for next year. A 3.0+ gpa and a good ACT or SAT score gets the scholarships if you’re willing to research.
Student loans are just like most borrowing in this country today (including credit cards); they are a means for someone to experience a lifestyle that has eluded most Americans for decades. They are creating a bitter, broke, childless population of middle-aged leftists...
One of mine decided he wanted to be a trucker. At 18 he took a class and got his CDL. The class cost $5,000 and the school had a $4,000 grant.
Because of his age (18) he had trouble getting a job at first.
His last job was for a company that went bankrupt due to poor management. His boss made one phone call on his behalf and told them that my son was the hardest working employee he’s ever had. He was hired without an interview. They bought him a brand new semi tractor and trailer and he’s loving it.
He delivers lumber to construction sites. It’s hard work and the type of work other truckers have told me they’re afraid to do. Most drivers go from paved loading dock to paved loading dock. He goes from the yard to muddy jobsites with tight turn around areas. He gets stuck in the mud and has to figure out how to get out.
I was on a site yesterday for my job. The foreman told me that their delivery guy had to back in 1/2 mile with a semi. That’s the stuff my kid does.
He’s also go the most important job in the family. His deliveries insure employment for hundreds of men.
He’s 21 years old, making at least $50K and zero debt.
(he also has zero expenses. He lives at his Grandma’s house and she won’t charge him rent)
just goes to show you that a little drive, goals and initiative goes a LONG WAY!!
Tell him Good Job!!
LOL I see this all the time. I know one who went to Penn State for music production and is now graduated and working at the local grocery store. Go to community college if you don’t know what the hell you want to pursue.
I posted a link to the full article in my initial comment.
Well done! If we had high schoolers now, we would tell them to learn a trade. We got sucked into the college BS 10 years ago with our two and certainly have our regrets.
Unfortunately this girl was serious about wanting to work at Disney. She and her mother were totally unrealistic.
Thanks.
We let them each choose their path. They’ve taken some diversity.
A rocket engineer, a truck driver, a book editor and a nanny who’s finishing her degree.
The editor can be a bit of a hermit so she’s absolutely loving the work from home bit. They reopened the office and she requested work from home anyway. I think she stays home three days a week.
Thanks.
We let them each choose their path. They’ve taken some diversity.
A rocket engineer, a truck driver, a book editor and a nanny who’s finishing her degree.
The editor can be a bit of a hermit so she’s absolutely loving the work from home bit. They reopened the office and she requested work from home anyway. I think she stays home three days a week.
My daughter and sil started a college savings account ,for their kids, as soon as they were married. All 3 will be able to go to college without any loans or financial aid. They’ve been really smart with their saving.
Very smart. We made the conscious choice to be single income and weren’t able to save a ton. My one son who I mentioned was the only one who did full four year university. We loaned him the money and expected it to be paid back.
Both daughters still owe us some as well.
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