NancysSummerSip
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Post by NancysSummerSip on May 23, 2014 14:01:50 GMT -5
I thought a friend and her husband were in deep doo-doo with $100,000 worth of cosigned loans for their two kids. Then I read this: finance.yahoo.com/news/student-debt-nearly-destroyed-this-family-s-finances-150749696.htmlAnd to top it all off: . ..With all three kids attending private universities, their collective student debt bill quickly grew to more than $500,000. Two of their children have managed to pay off their debt since graduating, but the couple is still strapped with more than $150,000 worth of loans and will add more to their load when their youngest son graduates next year (though, thankfully, he went to a public school). When Peter lost his job briefly a few years ago, they came close to losing their home and refinanced their mortgage in December to help pay for their eldest daughter's wedding.
“It has just killed us,” Shippen says. “We have no retirement savings. We’re on a 25-year repayment plan and still paying $1,700 a month. It’s like having another mortgage payment.”
No. Really?
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justme
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Post by justme on May 23, 2014 14:14:19 GMT -5
Title of the article: Being ridiculously, incredilby stupid about money Student debt nearly destroyed this family's finances Fixed it ETA: Should have crossed out "nearly" too.
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achelois
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Post by achelois on May 23, 2014 14:16:41 GMT -5
The 500,000$ would come out close to that amount? I have no sympathy for people like those in the article. I get that people want to help their kids, but you cannot commit financial suicide to do it. And then to refinance a mortgage on top of it to pay for a wedding?
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Deleted
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Post by Deleted on May 23, 2014 14:19:18 GMT -5
I'm assuming they're planning on the kids taking care of them in retirement?
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NancysSummerSip
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Post by NancysSummerSip on May 23, 2014 14:19:25 GMT -5
I thought a friend and her husband were in deep doo-doo with $100,000 worth of cosigned loans for their two kids. Then I read this: finance.yahoo.com/news/student-debt-nearly-destroyed-this-family-s-finances-150749696.htmlAnd to top it all off: . ..With all three kids attending private universities, their collective student debt bill quickly grew to more than $500,000. Two of their children have managed to pay off their debt since graduating, but the couple is still strapped with more than $150,000 worth of loans and will add more to their load when their youngest son graduates next year (though, thankfully, he went to a public school). When Peter lost his job briefly a few years ago, they came close to losing their home and refinanced their mortgage in December to help pay for their eldest daughter's wedding.
“It has just killed us,” Shippen says. “We have no retirement savings. We’re on a 25-year repayment plan and still paying $1,700 a month. It’s like having another mortgage payment.”
No. Really?
I'm confused - the 2 olders have paid off their debts? Where is the 150k from then? just the youngers public U? for the first 3 years? and how is 150K making payments of 1700/month over 25 years? Yes. And it could be that expensive. I went to (at the time) the most expensive public university in the nation. Just for the heck of it, I checked on the cost at this moment. $14,000 per semester right now. And that does not include books, fees, meal plan. And I'm assuming, since the article does not say, that the $1,700 includes the debt that the second-youngest accumulated, plus what the youngest has accumulated so far.
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justme
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Post by justme on May 23, 2014 14:20:21 GMT -5
Don't for get the youngest daughter (who they'll have to pay for a wedding for sometime soon) went to school for musical therapy and is making $34k but owes 5x that in loans. I get that some people aren't financially savvy, and no one really sits you down, but can you be that stupid to not realize that spending almost $40k/year is going to result in a huge loan with a huge bill?
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justme
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Post by justme on May 23, 2014 14:22:18 GMT -5
I thought a friend and her husband were in deep doo-doo with $100,000 worth of cosigned loans for their two kids. Then I read this: finance.yahoo.com/news/student-debt-nearly-destroyed-this-family-s-finances-150749696.htmlAnd to top it all off: . ..With all three kids attending private universities, their collective student debt bill quickly grew to more than $500,000. Two of their children have managed to pay off their debt since graduating, but the couple is still strapped with more than $150,000 worth of loans and will add more to their load when their youngest son graduates next year (though, thankfully, he went to a public school). When Peter lost his job briefly a few years ago, they came close to losing their home and refinanced their mortgage in December to help pay for their eldest daughter's wedding.
“It has just killed us,” Shippen says. “We have no retirement savings. We’re on a 25-year repayment plan and still paying $1,700 a month. It’s like having another mortgage payment.”
No. Really?
I'm confused - the 2 olders have paid off their debts? Where is the 150k from then? just the youngers public U? for the first 3 years? and how is 150K making payments of 1700/month over 25 years? It sounds like they have 4 kids. Two paid it off, the one that graduate with musical therapy still has $150k of debt and they have another kid that graduates next year. Though you'd think they'd know about how much they'd owe once he graduates instead of some unknown number.
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justme
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Post by justme on May 23, 2014 14:25:06 GMT -5
The first paragraph says four children.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 14:27:54 GMT -5
Student loans haven't nearly destroyed this family. Stupidity has nearly destroyed them. Why didn't they sit their kids down and tell them there are 4 of you, pick a cheaper state college you don't need to private universities especially for things like music therapy! I did go to a private college myself so I am not opposed to the idea, but the reason I chose it is the aid package was the most attractive. If I'd been looking at six figure student loans no way in hell I would have gone there. Even with their aid package I still ended up having to do 2 years at a CC first. I hate articles like these because I am supposed to feel bad for them and hate the big bad meanie loan companies, but yet when you actually READ the store you sit there going . This is like a news story trying to drum up anger against big bad credit card companies and their interest rates. The original balance was $250 that they "chose not to pay off" for the kid's college and the kid was going PART TIME to a community college. By the time the story ran the balance had ballooned into thousands. WTF? The kid couldn't have gotten a job to pay for that $250? Mom CHOSE not to pay it off and freaking openly admitted she could have paid it off before the balance accrued a single penny in interest. It isn't the credit card company's fault you're an idiot.
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NancysSummerSip
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Post by NancysSummerSip on May 23, 2014 14:37:59 GMT -5
I had to LMAO at the music therapy graduate, too. Her mom and dad will be sharing cans of cat food in retirement because princess wanted this degree.
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alabamagal
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Post by alabamagal on May 23, 2014 14:50:28 GMT -5
I read that. I hate articles like that because they always highlight the bottom of the barrel.
But when you read through the article, they are only $150k in debt right now with 3 kids through and 1 to go. That is bad, but not as bad as $500k.
The article says that they took out Parent Plus loans, but the kids were supposed to pay back 75% of their debt, and 2 of them had. That might work if the kids have good paying jobs, but I guess the 3rd is the one with the music therapy degree. And if the kids don't pay back, then parents are on the hook.
I understand wanting to help you kids get through school. But private school with no scholarships, no way. My kids are all going to public schools and they don't have to pay any tuition. I pay for some things (insurance, phone, use of a car, etc.) but they have to foot the rest themselves. I did cosign private for DD to go to summer school and get through school faster, about $11k but she is already down to $8k. DS2 has a private loan for $3k, and DS1 may need small one for next semester. But I have made it clear to them that it is their debt.
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wyouser
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Post by wyouser on May 23, 2014 14:58:03 GMT -5
You mean they may find music therapeutic as they dine on cat food? What sort of music goes with cat food anyway? Judging from the news lately, if one doesn't check labels on the cat/dog food or treats...you may want to select a funeral dirge if the contents were made in China.
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dannylion
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Post by dannylion on May 23, 2014 15:00:34 GMT -5
Wait, $150k for a music therapy degree? Who in their right mind would think that was a good idea? These people are morons.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:02:14 GMT -5
The debt might not be that bad, it sounds like the methods they used were what got them in trouble. I understand the article says the kids didn't get a lot, if any federal aid but that doesn't mean you run out and sign for a PLUS loan for musical therapy degrees at a private institution five minutes later either. Then the dad lost his job. That stroke of bad luck toppled the house of cards they'd built. But we're expected to believe it it's all the big bad student loan company's fault. Um. .. no. Then to top it off they refinanced their house to pay for a wedding. Good grief.
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mmhmm
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Post by mmhmm on May 23, 2014 15:06:18 GMT -5
You mean they may find music therapeutic as they dine on cat food? What sort of music goes with cat food anyway? Judging from the news lately, if one doesn't check labels on the cat/dog food or treats...you may want to select a funeral dirge if the contents were made in China.
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HoneyBBQ
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Post by HoneyBBQ on May 23, 2014 15:08:01 GMT -5
" refinanced their mortgage in December to help pay for their eldest daughter's wedding. "
You can't fix stupid.
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Deleted
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Post by Deleted on May 23, 2014 15:09:46 GMT -5
I would imagine the number of available jobs in the field is pretty low. Especially 6 figure ones.
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HoneyBBQ
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Post by HoneyBBQ on May 23, 2014 15:09:51 GMT -5
Wait, is this from the ONION? Nobody is this dumb:
“At the time, [the financial aid office] made it seem like the loans were free money,"
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HoneyBBQ
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Post by HoneyBBQ on May 23, 2014 15:11:07 GMT -5
Yes. And it could be that expensive. I went to (at the time) the most expensive public university in the nation. Yes, but did you major in music?
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HoneyBBQ
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Post by HoneyBBQ on May 23, 2014 15:13:57 GMT -5
I would imagine the number of available jobs in the field is pretty low. Especially 6 figure ones. I didn't read the article, but those are probably the employed music therapists. The rest work at Starbucks and aren't counted.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:15:45 GMT -5
From the article:
Channing, graduated with a degree in music therapy from a private university in 2013 and now works as a music therapist at a nonprofit helping the elderly. She earns about $34,000 a year and owes five times that much in student loans,
She plans on moving back in with her parents in September so she throw as much money as possible toward her debt.
Doesn't sound like the expensive private school degree is paying off.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:19:18 GMT -5
I would think most of us wouldn't gamble $170k non-dischargeable debt on the hopes that we will manage to land a six figure salary. Unless we're becoming a doctor.
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Works4me
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Post by Works4me on May 23, 2014 15:19:41 GMT -5
I wonder if their children had the grades and scores to get into a good public school.
Given the current economy, I am willing to bet that currently the public schools are more competitive, ie harder to get into. It is all too easy to forget that in many instances the private schools take anyone who will pay the bill.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:21:39 GMT -5
next year - 86k
If she's going to get that salary then why is she moving back in with her parents? There are no assurances she'll get a six figure job no matter what Forbes claims.
$170k is still a huge chunk of change (that's $34k times 5) and over the course of the loan she's also going to have to pay interest and PLUS loans/private loans often carry the highest interest rates compared to Staffords.
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Sam_2.0
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Post by Sam_2.0 on May 23, 2014 15:21:56 GMT -5
There are musical therapists everywhere - hospitals, nursing homes, special ed programs at schools. Our friends use one for their daughter with CP. Not sure how much they make, but it seems to be a hot field right now and not a bad choice if you like music I guess. Seems more employable than the degree DH got (Musical Theater and Sound Design).
So $500,000 between 4 kids (granted one is not yet done) is still well over $100k per kid. That still seems insane to me. Looks like they are spending about $35,000 per year for school each if not more. I plan to help out DD but I can't foot the bill for that much, let alone four of them! They had to realize that their kids would all be in school at the same time. DId they not plan for it at all?
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:27:53 GMT -5
And she probably could have gotten that musical therapy degree for a hell of a lot cheaper if they had explored other options. She didn't need to get it from a private school that cost that much.
Nobody forced her to go there or forced the parents to take out PLUS loans to get there, it was their own choices that landed them with the debt load they're having to carry.
I'm a meanie parent, I don't buy into I have to give my daughter her "dream" and let her pick wherever she wants to go to school. She gets what she gets from us we're not going to be paying loans off into our retirement. If we can't give her enough to cover the fancy private school she'll have to figure out another route.
It's supposed to be a sob story and I am supposed to be mad at the loan companies, I get it. But I'm not. There are a lot of choices in there that could have been done differently. They chose not to so now they'r stuck with $150k+ in loans to pay back. Suck it up buttercup.
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justme
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Post by justme on May 23, 2014 15:30:48 GMT -5
That leads me to believe they hadn't added the last kid's loans to their amount due yet. So $500k for 3 degrees, more like $40k/year.
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Sam_2.0
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Post by Sam_2.0 on May 23, 2014 15:31:55 GMT -5
I understand that the loan companies are the evil villian du jour. But the thing is that people seem to have forgotten their own responsibility for taking out those loans. No one forces you to get one. And except in some rare circumstances, getting a degree from a state school is going to get you just as far as paying ten times as much for one from an ivy league school. It's more about the effort you put in and how you build your career after school. A degree is just the initial launching point.
I could have easily gone to a state school and not taken out the $25k in student loans that I did for a math & sociology degree. I really wish I had now that I look back. But I don't bitch about Sallie Mae ripping me off. I knew what I was signing up for and chose to do it anyway.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 23, 2014 15:38:00 GMT -5
. But the thing is that people seem to have forgotten their own responsibility for taking out those loans. No one forces you to get oneI get high school's sell you a bill of goods on financial aid. I'm pretty sure the one guidance counselor at my high school was getting kick backs from Sallie Mae for every student she got to sign up. The actual loan companies themselves though if you call them will bend over backwards to help you. They do want their money back eventually so it's in their best interests to help you figure things out. The FA departments at the college you choose are good places to talk to as well. Until you sign the dotted line your aid package is negotiable. Intially it looked like I'd have to take out private loans but I talked to the FA office about my package, they ran my numbers again and got me an UnSub Stafford loan. Which was a MUCH better deal than Sallie Mae. My unsub loan had an interest rate of 2.5% Sallie Mae was sitting at 18% when I was in school.
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Post by Deleted on May 23, 2014 15:44:48 GMT -5
Seems "imagine" is the order of the day. I like to think of it as common sense.
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