College Debt

In my opinion, there is something very wrong with graduating college with a debt in the upper five to six-figure range. While it is true that there are many options to choose less expensive schools to attend, there is an ever increasing number of schools hitting and exceeding that $50,000 per year mark for tuition, room, and board.  Regardless of the cost of the college you choose, very often there are loans to pay off afterwards. One should think long and hard before spending over $200,000 for a 4-year college education.

Once a student has narrowed down the list of potential colleges he is interested in attending, the first thing to consider of course is if he will get in.  When he does, sometimes he is so overcome with pride that he got in to this ‘fabulous’ school, that he might not really look deeply into if he can really afford it.  Some students are fortunate enough to have financial help from parents; others work, take out loans, or do a combination of the aforementioned. 

So let’s say that a student really wants/needs/desires to attend one of the $50,000 per year schools.  They have no financial support from parents, so they work part-time and take out loans.  Maybe they qualify for some reduced rate, scholarship, or grant.  But when all is said and done, they graduate with $75,000 - $100,000 in debt.   Now what?

Well, in this economy, there is no guarantee of a job in your field.  Actually, there is no guarantee of a job in any field.  If you are lucky enough to land a job, it is highly unlikely that it will pay enough to cover your rent, living expenses, and still have enough left over to begin chipping away at that huge tumor, that seems to grown instead of shrink each year.  You may have to move back home, which is less than ideal for both parties involved.  Although it is okay for a child to live back home for a predetermined amount of time after college while ‘getting on his feet’, that time should be short lived.  After all, our goal as parents is to raise an independent, caring human being.

Why colleges charge the prices they do is a whole other blog topic, but why do students pick a school to attend that they can’t afford?  I don’t live in a house that I can’t afford.  Nor do I drive a car that I can’t comfortably pay for.  I look at the whole picture, and even though I really want a different car, I can’t have it.  I have to settle for one that will get me where I want to go, without the fancy name.  Aren’t colleges like that?  Can’t you get you your 4-year education without the fancy name?  Can’t you still find a job afterwards, get married, have a family and buy a house with a white picket fence?  Can’t you live a happy life without attending that college?  Four years of your life is but a blip on your lifeline but can affect it in a big way.

I’m not saying that all college educations are equal.  What I am saying is that you need to balance what you want with what you can afford.  How sure are you that you need that particular school, and only that particular school, to get the education for your area of interest?  Think ahead four years to what situations you may find yourself in.  Are you willing and able to live at home?  Are you willing to relocate to get a job?  How far away? 

This is all easy for me to say because I have gone through the process and I am a mature adult looking back.  For students approaching this juncture in their lives, a little parental guidance goes a long way.  It is easy to get caught up in the ‘Wow my kid got into (substitute school name here)’ syndrome.  Five years out, no one will remember what school your kid went to, but they will see what he is doing with his life.  But more importantly than what others see is how your kid feels about what he is doing and how strapped he is or is not to a boatload of college loans.  It is not easy to have that kind of debt, especially if you are unemployed and living at home. 

Here are a few questions to ask yourself when you have selected your college:

1)    Why do I want to go to that school?

2)    Can I afford it?

3)    If not, what other schools offer a similar program that I can afford?

4)    How much college debt do I want when I graduate?

5)    Do I want to live at home or on my own when I graduate?

6)    If the answer to #2 was no, why am I still selecting that school when I know I am setting myself up for stressful debt when I graduate?

The ridiculous price increases of college tuition nowadays are limiting some kids’ aspiration of attending the school of their dreams.  I get that.  But the reality is that the prices are what they are, so make your decisions accordingly and wisely.