Colleges and college loans are big business. Think to the future when choosing a college, which requires a loan.

Short version:

Stay away from student loans as much as possible.

Colleges are popping all over. They’re now big business.

College loans are fairly easy to get, but hard to pay back.

College loans may NEVER be discharged, even in bankruptcy.

College debt may very well cripple a young person’s life.

The explanation:

When I got out of college, I had 12k in school loans and began a career making 12k.

Those were the days when, for most kids, an education guaranteed a job and a competitive wage.   Much to the surprise of many, education is no longer a guarantee for neither the wage nor the job. In fact, with easily accessible school loans, a college education may set-up the young adult for staggering debt.

Case in point. Angie attended college believing her lucrative career choice would earn her a good salary. What Angie did not realize was, her popular career was glutted and hard to find, not to mention, the starting wage would be much lower than anticipated.

The biggest problem, which plagues Angie, is her crippling monthly school loan payment. With ease, Angie borrowed the money for her education, of course thinking she would earn the big bucks to pay it off. You see, her career is a top earning job, but that’s after 15 years. Knowing the future potential, the lenders were happy to give the money, plus the college touted the earning potential. No one ever told Angie it would take a long time to make the money. Truly a starry eyed young person.

It has been a very difficult time for Angie and after 5 years of graduation, she is beginning to afford the basics of living. Endless money worries have kept her awake at night. Trust me. Your child’s worries become yours.

A worse case scenario, Milo was the apple of his parents’ eyes. He was incredibly bright, but he was a marginal student in high school. He went to the college of his choice, taking out student loans to achieve his goals. Two years later, Milo continued to search for his goals, leaving his dream college for a local school. After long, he did not find his dream, and dropped out of school all together. He was $40K in debt with no degree. That’s terrible!

Do you want this for your child? You can ease this problem for your child. Here’s the biggest deal, YOU must be very involved when your child is making financial decisions. Your child will never believe that loans will haunt him for many years, making his future much more difficult.

My humble suggestions:

Apply for every grant and scholarship available.  However, for most people, school loans are a must. So you must borrow with the future debt in mind. Angie now wished she did.

Unless you have the money to send your child to the school of his choice, your child should be attending a “good bang for the buck”. State schools and community colleges are the answer in many cases. Of course every college bound high school grad wants the status of a prestigious school. I want to drive a Tesla. So what?! If it’s out of budget, the loans will no doubt come back to haunt. The future sleepless nights are not worth it. Not to mention the hit on his credit score and any chance of getting financing for necessities.

Here’s the biggest kicker. There was a time when schools were a service to mankind. Now schools are big business. Colleges are popping up at an alarming rate because they know college money is fairly easy to come by. The biggest secret about school loans, school loans may never be discharged unless the person dies. Never! Not even bankruptcy. Again, a person MAY NEVER default on student loans. The borrower may even get collection calls on his deathbed.

Crazy, huh? We send our kids to college to better their future, and then we tie them down with staggering debt. Be smarter than the system.

Encourage college if ,and only if, your child wants to go. Find free money. If no free money exists, find the college which offers a good education and is a good value. Again, community colleges and state schools usually fit these criteria.

Take this advice for your child’s future. If you doubt my words, ask college grads who have college loans. Most will tell you the college loans impact the basics of life, dependable transportation, safe living environment, and even decent food. Often they will tell you they wished they’d gone to college with less debt.

****The people are real. Names were changed to protect the embarrassed. I don’t know about Milo, but I know for a fact Angie looks back on her decisions and says to Mom and Dad, “I wished I’d listened.” ****

****** Co-signer- the lending institution will be sending that payment book before your kid can get a job. So be prepared to make the payment. Oh, if you don’t, your credit rating is impacted.