Student loan for college

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2,235
Location
West Michigan
Where did the time go? My son graduated high school and is starting college at MSU this fall. We have a good chunk of money set aside for this, but not enough for the full 4 years. My boy's mother is determined that we will co-sign student loans to cover the balance. I'm not convinced. My son is very bright academically. I'm very concerned about his work ethic, he doesn't really have one. My thought is to let him borrow the balance through subsidized loans and let him pay it off when he graduates. I will be retiring (hopefully) in about 6-7 years and won't be able to repay these loans should he default. This is getting to be a MAJOR issue between his mother and myself. Not interested in her having an emotional melt down, but what in the world can I say to convince her the logic in my point of view?
 
Messages
501
Location
not Sweden
Originally Posted By: HM12460
I will be retiring (hopefully) in about 6-7 years...what in the world can I say to convince her the logic in my point of view?
Simple. Your son can get loans to fund his college, but you won't get loans to fund your retirement. Which do you value more: a secure retirement experience, or your son's college experience?
 
Messages
472
Location
IL
Originally Posted By: SwedishRider
Originally Posted By: HM12460
I will be retiring (hopefully) in about 6-7 years...what in the world can I say to convince her the logic in my point of view?
Simple. Your son can get loans to fund his college, but you won't get loans to fund your retirement. Which do you value more: a secure retirement experience, or your son's college experience?
Yep... I just started paying my school loans, all are private and federal loans in my name.. Over 95k to pay back. That would be too much of a burden to put on yourself, and this is coming from a 28 yr old guy!
 
Messages
10,727
Location
MA
Well if you co-sign for the loans, then you're not retiring. Only co-sign if you have enough to take over the payments. As you will have some savings, they can come after you, but your son would be somewhat judgement proof until he gets a job, but depending on the court, some court judgments are good for 20 years. Also you don't really need to co-sign the loans unless he doesn't qualify. Normally he would apply for the loans on his own and then if he gets turned down, you then co-sign for the loan. In theory, you'll have enough money to go through a couple years before this really becomes an issue, so you can postpone the melt down until then.
 
Messages
6,638
Location
South Florida
Based on your line of thinking, I believe that you already made up your mind. Let the boy out of the nest, let him become a responsible adult, and let him worry about his college loans. It already sounds like you have a substantial amount of money to put towards his education. Babying your kids damages them more than if they were not babied, trust me.
 
Messages
299
Location
Missouri
My last one graduated last year. Took him five years. He took the subsidized loans and found grants, internships, specialized scholarships, and on campus work. He has been on the job 13 months and has paid off his $10,000 debt. There are a lot of doors on these campuses that my sons knocked on because we didn't write them a blank check. They are better for it. Convince your wife the time for him to struggle is now while he is young. He will be stronger and more successful because of it. If he is interested in technical/scientific fields, the CO-OP opportunities are fabulous. The experience gained is an education in itself. It doesn't have to take all that much longer. I grad hs when 17, started college CO-OP at 18 and grad college when 21 with money in my pocket. Granted my sixties era college experience was different than many, but I never regretted those tough four years. It helped me immensely in my life. If we love our children, we permit them life's challenges. Their success will be so much sweeter and the rewards more satisfying.
 
Messages
677
Location
USA
Same thing happened with my cousin. His mom was told if she wanted that for him and to cover him for what he didn't save, then she "outta strap on some gloves and a hat and work at home depot for the next 10 years." It is not worth giving your retirement up to give your son a debt free college life. That life will teach him so much if he learns to spend his money wisely and save every penny. If you go ahead and pay for everything, chances are he wont care and put less effort into it. It is like buying a kid a new car. They wont respect it UNTIL they are the ones paying for it.
 
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8,022
Location
MI
Community college for the first 2 or 3 terms, then transfer. Let him live at home and save a boatload of money. Make sure that he plans VERY carefully so that all his credits transfer. Why pay the high prices for general classes that will be taught by foreign teaching assistants addressing 200 or more students per class? This will teach him about making sacrifices but he will still get an opportunity for the big college experience in the end. There are lots of "help wanted" signs across Michigan now and there are tons of student jobs available at MSU. Best of luck to you and your future Spartan.
 

gathermewool

Site Donor
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8,927
Location
New England
If he wants a free ride and is as bright as you say, then he either pays his own way or joins the military... My parents helped me out with a few grand. The rest was on the gov'ment...
 
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24,382
Location
Central Florida
Bubbatime, You are a smart man, I agree 1000000000 % My son completed 2 years at a community college and transferred to a 4 year school. Tuition reimbursement at his work and partial scholarship paid the rest. He graduated with almost zero debt.
 
Messages
1,723
Location
Virginia
Originally Posted By: doitmyself
Community college for the first 2 or 3 terms, then transfer. Let him live at home and save a boatload of money. Make sure that he plans VERY carefully so that all his credits transfer. Why pay the high prices for general classes that will be taught by foreign teaching assistants addressing 200 or more students per class? This will teach him about making sacrifices but he will still get an opportunity for the big college experience in the end. There are lots of "help wanted" signs across Michigan now and there are tons of student jobs available at MSU. Best of luck to you and your future Spartan.
This actually could be a very smart move. I don't know how it is where you live, but where I am if you go to the local community college and get your associates degree with a decent GPA, you have guaranteed acceptance into several very good state universities. It's worth looking into to see if you have something similar set up around you. It'll drastically reduce your son's tuition rates the first two years, and still allow him to get a B.S. or B.A. degree from a university in four years. Plus, with the reduced tuition rates the first two years, you can have him pay his own tuition so that he better understands the value of money and hard work. Regardless of what you do, I suggest you have him pay for some of his own tuition. It really helps teach kids the value of money when they realize they can't just spend every dollar they get in their hands. I know way too many kids who graduate college and get a job, but they're still on their parent's cell phone plan, still on their parent's insurance plan (health and auto), and their parents help pay their rent despite the kid having a job and waisting most of their income on partying with friends. We all have to grow up some time, and I think having a child help pay for their own tuition is a great character building opportunity for them. But please understand, this is just my opinion and i'm not trying to tell you or anyone else how to care for their child.
 
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6,170
Location
North Coast
I did 2 years in a community college for peanuts then transferred to a 4 year private college. That was 30+ years ago. In today's dollars I would have saved about $35,000 in tuition costs. But if he is already at MSU then you might consider letting him go there. Just make him produce a 3.0 GPA or the cash flow stops. BTW my wife and I both paid for our education it was a struggle. I now can afford to send all 3 of my kids to college. So, I am. But I learned from my own struggle and invested for this 25 years ago.
 
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Messages
2,547
Location
IL
I really like the Asian model for college: Parents start a "college fund" when you are very young, you go to school, get good grades, then college,(doctor, lawyer,engineer) get a degree, get a job and then get married with no tuition debt! Have a baby and parents move in with you to raise Grandson! smile
 
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Messages
593
Location
Al
Your wife is 100% wrong on this issue. Huge mistake to cosign college loans. No matter what do not sacrifice or risk your retirement to fund the kid's college. The young man can get by with his own loans. If he can't get loans he can live at home and go to community college for 2 years. We he gets thru 2+ years of college with a great GPA, then you can see he is 100% sincere and has good work ethic - then and only then you can help a little because you are sure it is for a good cause. But not before. It is much better to make sure the kid struggles a little, and has lots of skin in the game, when he goes to college. Make him get his own loans.
 
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Messages
1,459
Location
NY
Reagardless of who's paying off the debt in the end - what's the benefit (in reality or in your wife's opinion) of cosigning over going the subsidized with just your son's name on the loan. I admit - it's been a few years since I looked at loans and compared private versus subsidized/unsubsidized/parent plus versus whatever else is out there, so maybe there are different options now. Seems like the rate is better for federal loans than private ones. Not advocating for you paying for them down the road, but either way, seems financaily the subsidized loans are a better bang for the buck than you co-signing the private route. My 2cents - that's the approach I would take of why the subsidized route is better. Discover: Comparison of Federal and Private Student Loans
 
Messages
7,493
Location
North America
Originally Posted By: SwedishRider
Originally Posted By: HM12460
I will be retiring (hopefully) in about 6-7 years...what in the world can I say to convince her the logic in my point of view?
Simple. Your son can get loans to fund his college, but you won't get loans to fund your retirement. Which do you value more: a secure retirement experience, or your son's college experience?
This goes with everything I have heard from financial advisors on the subject.
 

Nick1994

$50 Site Donor
Messages
13,293
Location
Phoenix, AZ
Yup sign him up for community college, I'm a student at one and will transfer to ASU. In the end you get the exact same degree, and save $30-40,000 at least. Then you may be able to pay in full his education. Community college with books is around $1,500-1,600 per semester out the door.
 
Messages
2,100
Location
British Columbia, Canada
When my daughter was in university she lived at home as long as possible. She had a small inheritance that paid a lot of the costs for the first few years. Eventually she had to live on her own (as we moved for work reasons) and with the increased costs she had to take out student loans. When she graduated I told her we would pay her loans off together. I paid half as long as she paid the other half as quickly as possible. That approach had several advantages: paying for her education became a source of pride, she had every incentive to keep her costs low, and the fairly small loans were retired in short order (a year or two). When I was in university, those with more money usually found a way to spend it.
 
Messages
25,815
Location
Upstate NY
Its reasonable for the student to take out student loans that equal the first years expected salary upon graduation. Do they need to be cosigned? He needs some skin in the game. Some parents need to have a "frank" discussion with their kids about how much they can afford for college.
 
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