Student Loan Debt

[Bob Sacamano]

17 hours ago, bigruss said:

Well I do think there is a thing to the whole not living at home and finding yourself, but it's not necessarily something you have to do right at that time.  For me in high school, community college was looked at as "you couldn't get in anything better", and that mentality needs to change.  I definitely try to sell folks on CC + finish at a 4 year school route when discussing options, but the perception really matters in HS, and that's not just with other high schoolers, but with school teachers and admins that are expecting folks to go to 4 year programs as a success benchmark. 

Also, I was taught a bit about personal finance, but not a single teacher, admin, counselor, etc talked about the expense of school and how to approach it.  The only thing I ever heard was when my civics teacher broke down his budget and his loans were part of the conversation.

This perception in general that you need college to be successful in life also needs to end. Going to some sort of trade school is a good option too.

[Texsox]

3 hours ago, manbearpuig said:

This perception in general that you need college to be successful in life also needs to end. Going to some sort of trade school is a good option too.

Agreed. 

A lot of it is marketing. With pressure to retain the next students instead of having them choose a magnet program or for profit,  taxpayer supported, charter schools the public schools need to hit those easy for the public to recognize metrics. 

For example a charter school in the area bought dozens of billboards in the area to announce 100% College Acceptance!! for their senior class. It was very effective at recruiting students away from public schools.  

How did they accomplish this amazing feat?  Glad you asked.  They required every senior to apply at the local college that accepts everyone. 

The second issue is with all these college grads it means we'll have a more educated society, but not every available job is high paying. We need Amazon warehouse and for now, delivery drivers. They don't even need a high school diploma. My buddy graduated with a master's in architecture in the 80s. No one was hiring when he graduated. He was one of those that were say don't get an art degree or you will work in a restaurant. Only his was architecture. 

 

[ptatc]

9 hours ago, manbearpuig said:

This perception in general that you need college to be successful in life also needs to end. Going to some sort of trade school is a good option too.

This is true. However people also need to have appropriate expectations. You can go to the trade school but don't have expectations of having the lifestyle of a Manager in an insurance company. Too many people have the expectations of the have's and have nots. Different professions have different growth capacities. Doesn't mean you aren't successful, you are just in a different industry that may or may not lead the a certain lifestyle. You need to pick the trade appropriately as well. If you go to the aircraft airframe and powerplant school your lifestyle is going to be very different than if you become an electrician. 

Edited January 21, 2021 by ptatc

[ron883]

I pissed away scholarship money and wasted money by dropping classes because I was more worried about partying. This money was covered by loans.

I also have friends that received more loan money than they actually needed for classes. The leftover money went straight into their wallet and was used for booze and partying. 

None of us need our loan debt erased, but we would take it of course. Plenty of people could use that relief more than us. Seems a bit disingenuous for us to get relief, especially since large chunks of the debt were a direct result of partying and not taking school seriously enough. 

Edited January 21, 2021 by ron883

[Texsox]

6 hours ago, ron883 said:

I pissed away scholarship money and wasted money by dropping classes because I was more worried about partying. This money was covered by loans.

I also have friends that received more loan money than they actually needed for classes. The leftover money went straight into their wallet and was used for booze and partying. 

None of us need our loan debt erased, but we would take it of course. Plenty of people could use that relief more than us. Seems a bit disingenuous for us to get relief, especially since large chunks of the debt were a direct result of partying and not taking school seriously enough. 

My ex took out private parent loans for our daughter's education. She later was telling my daughter the debt was crippling her financially, ruining her life,  and that the loans totaled over $100,000. My daughter was understandably  distraught until we started doing some math. After what I contributed, and my daughter earned in scholarships and other financial aid, the difference was substantial,  but much closer to $40,000 than $100,000. Go Illini!! 

It didn't take long to prove with receipts that my ex maxed loans every year but spent less than half on our daughter's education. She partied with the extra money. 

Your story is very close to my son's story. Since this is anonymous I hope you don't mind me sharing with my seniors. I have a collection of warning stories I share. 

Since Republicans love tax cuts perhaps cutting borrower's taxes the amount of their student loan payments up to $10,000 may sound better. 

[longshot7]

On 1/19/2021 at 2:07 PM, southsider2k5 said:

The idea that we are trusting 17-18 year old kids to be able to see the future and project which jobs and careers will be around in 10/20/30 years to a degree of certainty that many are going to carry six figures (or more) of debt in making that bet is absurd.   These are the same kids we don't trust to drink or drive a rental car, but are fully putting a hundred thousand dollars worth of debt and their careers in the same hands.

The best economists out there struggled to see the changes in the world during my lifetime.  The fact that we are having kids bet their careers and financial futures on it is laughable.  

There has to be a better way to do this.

This is what got me. I took loans upon loans out for grad school thinking the lenders would make it reasonable to pay back - and unlike say a mortgage, no one sits you down and spells all your monthly payments back to you so you know what you're getting into. It's classic predatory lending.

I have $400K in debt that I will never pay off in my lifetime, and yes it means I will never own a home or be able to have children because it's just not feasible.

Those were the choices I made - never knew how it would affect me 20 years later...... and counting....

[Texsox]

5 hours ago, longshot7 said:

This is what got me. I took loans upon loans out for grad school thinking the lenders would make it reasonable to pay back - and unlike say a mortgage, no one sits you down and spells all your monthly payments back to you so you know what you're getting into. It's classic predatory lending.

I have $400K in debt that I will never pay off in my lifetime, and yes it means I will never own a home or be able to have children because it's just not feasible.

Those were the choices I made - never knew how it would affect me 20 years later...... and counting....

The "counseling" that is required for the government back loans is so easy to click and ignore that I doubt 5% of the borrowers actually pay attention. 

[longshot7]

10 hours ago, Texsox said:

The "counseling" that is required for the government back loans is so easy to click and ignore that I doubt 5% of the borrowers actually pay attention. 

Yeah I don't recall ever hearing it - I have literally as much debt (if not more) as a mortgage!

[Texsox]

You have to click on some questions at the end.  

[he gone.]

14 hours ago, longshot7 said:

Yeah I don't recall ever hearing it - I have literally as much debt (if not more) as a mortgage!

In the same boat. We're still going to have kids, but it quite literally makes an impact on every decision. It's fine because i didn't/dont want a big house anyways, but it's definitely such a large sum that unless you're confident and want to throw all your wages at it for a decade+ then it makes more sense to just pay the minimum, watch it go up, and then have it forgiven and just pay the taxes on it as income at the end. 

The thing is if i throw $12k at it a year for 5 years? 60k later my balance will be up from where it is now from interest. it's wild. 

 

I've come to grips with it, but I do think these steps should be considered -- if we're not forgiving loans then come up with a creative solution to help those who have loans out.

a) zero percent interest. whatever is owed let the government take that on. this is a meet in the middle compared to just forgiving the loans. 

b) make very strong tax arrangements that incentivize the payback. like really strong, almost unfair. 

c) maybe make something where every dollar counts as two for the next 3 years or something? 

d) allow BK

 

I'd personally like these to be forgiven obviously, but it's not a very popular option and why should it be? there's 75% of the population that doesn't go to college and look at college grads as the 1% in their mind. Why should we help the priveleged?  It's a messed up way to look at it since really nobody is to blame here outside the politicians who set off this domino effect by not allowing BK which then allowed loans to be thrown around and then college tuition to inflate wildly while returning no real extra upside wage wise. If it continues like this you'll have to see a correction period of less college degrees and then less colleges too. 

 

 

[Harry Chappas]

People that graduated college prior to 1995...like ME...have no concept of student debt to that great of a magnitude as public institutions were more affordable.

You could realistically put yourself through college back then.

Boomers didn't need college as much and the cost again was about the same as Gen X I would guess.

The 50 year old man that spent 6 years going to college cannot talk about student debt similarly to a 30 year old today.

 

[Iwritecode]

On 1/25/2021 at 6:05 AM, Texsox said:

You have to click on some questions at the end.  

Based on his b-day, I'm guessing there was no "clicking" involved when he got his loans. It was probably all done with actual pen/paper.

[cws0591]

I have really been torn on this topic. I have student loan debt. I also feel like I did everything right up to this point and if debt is forgiven I will be punished. Went to a community college for two years. paid out of pocket. Went to Niu for my Bachelors. Fafsa loans would only cover about 70% of my tuition so I worked two jobs while in college to pay the remaining 30%. absolutely this affected both my ability to take on internships(I believe my biggest mistake) and also do school activities outside of going to class. When I finished school I threw all of my excess funds from my job and also a pretty decent investment portfolio I built up at my 6.5 and 5.5 interest rate loans. paid those off. I still owe right around 20k and thank god for the covid moratorium on those loans because living was very tight with the additional 260 a month payment for those remaining loans. If there is loan forgiveness I will absolutely be upset about grinding away and causing my self short-term hardship. But its the right thing to do.

[mqr]

On 1/21/2021 at 3:47 AM, manbearpuig said:

This perception in general that you need college to be successful in life also needs to end. Going to some sort of trade school is a good option too.

I would be a LOT more well off if I just went to trade school

[mqr]

I'll admit to there probably being economic consequences I don't fully understand (though I don't know how a bunch of broke people with college degrees suddenly having extra income is a bad thing) but the idea of being unfair is brain dead. Everyone in that transaction got unfathomably, filthy rich off of a broken system except you. Screw em. 

Edited January 26, 2021 by mqr

[he gone.]

49 minutes ago, cws0591 said:

I have really been torn on this topic. I have student loan debt. I also feel like I did everything right up to this point and if debt is forgiven I will be punished. Went to a community college for two years. paid out of pocket. Went to Niu for my Bachelors. Fafsa loans would only cover about 70% of my tuition so I worked two jobs while in college to pay the remaining 30%. absolutely this affected both my ability to take on internships(I believe my biggest mistake) and also do school activities outside of going to class. When I finished school I threw all of my excess funds from my job and also a pretty decent investment portfolio I built up at my 6.5 and 5.5 interest rate loans. paid those off. I still owe right around 20k and thank god for the covid moratorium on those loans because living was very tight with the additional 260 a month payment for those remaining loans. If there is loan forgiveness I will absolutely be upset about grinding away and causing my self short-term hardship. But its the right thing to do.

There's going to be a lot of this argument and I agree with it. Unfortunately there's not many good solutions where everybody wins. Definitely has changed lives for the worse across the board. You have people like you who have done the right thing and get screwed. You have people like me who married into it and now have to change everything about our lives for it. It's a completely bogus situation that was created out of human error.

 

Also imagine how the ohter 75% feel. the ones who didn't go to college ... they're even more perplexed and against it. Why should the elite/rich get forgiven for going to college? That's their mindset. 

 

There's some merit into looking into income garnishing type colleges. like free college, but you pay a certain percent of your paycheck back to that college until $ a certain figure is hit or until a certain age is hit. It would incentivize colleges to actually prepare you for a well paying job since they are invested into the returns instead of just pumping out degrees for $$. That has a whole other set of issues tied to that solution as well, but i wouldn't mind some competing mindsets in higher education to drive competition. 

[Texsox]

The more I think about this the more I'm convinced that income tax cuts for Americans with student loan debt is the politically feasible path. What Republican doesn't agree with tax cuts? 

More interesting to me. When I cast my first vote for President, Jimmy Carter's failed bid for reelection, the image was Republicans carried brief cases to work and Democrats carried lunch boxes. Blue color versus white color. The debate over student loan forgiveness and the last election seems to strongly refute that premise. 

There is at the minimum a mixing. Or the Dems are making a strong move with student loan relief to appeal to the professional college grad with a briefcase. 

[mqr]

7 hours ago, Texsox said:

The more I think about this the more I'm convinced that income tax cuts for Americans with student loan debt is the politically feasible path. What Republican doesn't agree with tax cuts? 

More interesting to me. When I cast my first vote for President, Jimmy Carter's failed bid for reelection, the image was Republicans carried brief cases to work and Democrats carried lunch boxes. Blue color versus white color. The debate over student loan forgiveness and the last election seems to strongly refute that premise. 

There is at the minimum a mixing. Or the Dems are making a strong move with student loan relief to appeal to the professional college grad with a briefcase. 

I've a hard time believing either party is paying any mind to the lunch pail crowd.

[he gone.]

53 minutes ago, mqr said:

I've a hard time believing either party is paying any mind to the lunch pail crowd.

True - both parties are fundamentally the same. Its not like theres a budget conscious crowd. If they're anything the parties are strong marketers. They play on emotions and act like they have many, many differences. Everybody buys into it. 

[Texsox]

16 hours ago, mqr said:

I've a hard time believing either party is paying any mind to the lunch pail crowd.

And perhaps that's another part of Trump's appeal. 

[CentralChamps21]

16 hours ago, mqr said:

I've a hard time believing either party is paying any mind to the lunch pail crowd.

 

35 minutes ago, Texsox said:

And perhaps that's another part of Trump's appeal. 

That was his appeal. He found a group of voters that both parties had been neglecting and that was largely gullible. When he told them that they were being neglected because of Muslims, illegal immigrants, blacks, Hispanics and transgender people, they bought it and they elected him. When he told them that record low unemployment and record high stock market were signs that he was doing wonderful things for them, they bought it, even though they didn't really benefit from those things and their wages remained stagnant as their bosses got huge tax cuts.

Now we have the Republican party in Arizona censuring the sitting governor and a former Senator because they chose to say things that were true instead of things Trump wanted them to say, and in Oregon putting out a formal statement that the Capitol attack was a false flag operation even as hundreds of attackers have been identified and admitted to being long-time Trump supporters.

[mqr]

4 hours ago, Texsox said:

And perhaps that's another part of Trump's appeal. 

I'd say it's like 80% of trumps appeal. People who feel need neglected by the parties are either turning to Trump people or the Bernie/AOC/Omar crowd, and which one is dependent on that other 20%

[southsider2k5]

3 hours ago, WhiteSoxFan1993 said:

 

That was his appeal. He found a group of voters that both parties had been neglecting and that was largely gullible. When he told them that they were being neglected because of Muslims, illegal immigrants, blacks, Hispanics and transgender people, they bought it and they elected him. When he told them that record low unemployment and record high stock market were signs that he was doing wonderful things for them, they bought it, even though they didn't really benefit from those things and their wages remained stagnant as their bosses got huge tax cuts.

Now we have the Republican party in Arizona censuring the sitting governor and a former Senator because they chose to say things that were true instead of things Trump wanted them to say, and in Oregon putting out a formal statement that the Capitol attack was a false flag operation even as hundreds of attackers have been identified and admitted to being long-time Trump supporters.

Now THIS would be a time for the GOP to complain about freedom of speech...

[Two-Gun Pete]

From Yahoo.com on PLUS loans

A few things that struck me as interesting:

A blue collar family ended up owing half a mill in PLUS loans.

 

..."It’s also easier to accumulate heavier debts, because the only cap on parent PLUS loans is the total cost of attendance, minus any other aid provided...."

 

..."The Education Department views these loans — as it does all student loans — as “instruments of social insurance policy and not traditional debt,” which is why they are not subject to traditional underwriting norms, a spokesperson said."

 

..."Currently, “there are no repercussions if the parent can’t pay and defaults in the future,” said Fishman of New America. “It is ‘free money’ for the institution.”

 

I see this sort of thing from time to time at work. And I think it would help to do something about proving one's ability to repay all types of student loans, to include these moronic PLUS loans.

Edited June 7, 2021 by Two-Gun Pete

[southsider2k5]

It's time to remove the bankruptcy restrictions from student loans.