Here is one that I've pondered through.. take it for what you will.
Those of you with kids getting close to college, you may be inclined to go into debt to pay for your kid's school. I would say don't. Let them take out the loans even if you just help out. Two reasons:
1. The rates on federally backed student loans are obscenely low. It is far below average rate of market return. But more importantly... 2. People will lend your kids money. They will be young with a college degree and hopefully a job. NO ONE is going to lend you money to help you retire. Don't sacrifice your retirement.
Here is one that I've pondered through.. take it for what you will.
Those of you with kids getting close to college, you may be inclined to go into debt to pay for your kid's school. I would say don't. Let them take out the loans even if you just help out. Two reasons:
1. The rates on federally backed student loans are obscenely low. It is far below average rate of market return. But more importantly... 2. People will lend your kids money. They will be young with a college degree and hopefully a job. NO ONE is going to lend you money to help you retire. Don't sacrifice your retirement.
Just the other day, my mom told me that lending institutions are requiring parents to co-sign for college loans because so many students are defaulting. (I don't know that this is true, but could be.)
I turned 18 less than a week before I began college, so my parents had to co-sign my loans for me. They paid nothing of my college. I paid to maintain and insure my vehicle. I paid for anything I needed for school. I lived at home. That was what they considered their contribution. I worked 2-3 jobs and you know what? It didn't kill me. I came out of college with loans, but nothing that was obscene. I made sure to pay as much as I went and borrowed the smallest amount that I could manage.
That should lead us to this tip-- don't borrow more than you need for college. That means-- don't borrow money to buy clothes or to go out to party.
Our daughter is in the 7th grade. We've already told her that it will be impossible for us to pay for her college education. She may live at home. We will make sure she is fed and has a house to live in. We will help in ways that we can but it is on her to make sure that she maintains grades to get scholarships and whatnot. We cannot do it and even though my in-laws got mad at us for telling her that, we explained that it is going to be her responsibility. I don't think that is a bad thing.
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Those of you with kids getting close to college, you may be inclined to go into debt to pay for your kid's school. I would say don't. Let them take out the loans even if you just help out. Two reasons:
1. The rates on federally backed student loans are obscenely low. It is far below average rate of market return. But more importantly...
2. People will lend your kids money. They will be young with a college degree and hopefully a job. NO ONE is going to lend you money to help you retire. Don't sacrifice your retirement.
I thought it was life lessons learned from pearl jam.
even if I look and act really crazy.
I turned 18 less than a week before I began college, so my parents had to co-sign my loans for me. They paid nothing of my college. I paid to maintain and insure my vehicle. I paid for anything I needed for school. I lived at home. That was what they considered their contribution. I worked 2-3 jobs and you know what? It didn't kill me. I came out of college with loans, but nothing that was obscene. I made sure to pay as much as I went and borrowed the smallest amount that I could manage.
That should lead us to this tip-- don't borrow more than you need for college. That means-- don't borrow money to buy clothes or to go out to party.
Our daughter is in the 7th grade. We've already told her that it will be impossible for us to pay for her college education. She may live at home. We will make sure she is fed and has a house to live in. We will help in ways that we can but it is on her to make sure that she maintains grades to get scholarships and whatnot. We cannot do it and even though my in-laws got mad at us for telling her that, we explained that it is going to be her responsibility. I don't think that is a bad thing.
2016: Lexington and Wrigley 1