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Our sons' student debt is delaying our retirement

money.cnn.com

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Re: Our sons' student debt is delaying our retirement

#61

Post by Phlarp »

cm2012 wrote: post #40
intopieces wrote: post #28

Earlier quoted context omitted.

>I think we need to do more to help educate parents and prospective students that in most cases a college degree is next to worthless. Do you have a source for this? The Bureau of Labor Statistics says the exact opposite. [0] >Most psych/business majors would be better served working their way up through the ranks. Source? Again and again, people only seem to look at the cost of education like education is a product…

> Source? Again and again, people only seem to look at the cost of education like education is a product that you buy at a store that could be gotten cheaper. College education is an experience, an exposure to new ideas, a gradual development of ancillary skills. -- Few people are saying college has no value. Mostly people say what you get is not worth what you pay. My own anecdote - I am by all accounts a successful…

Very similar trajectory; I attended a very middle of the road business school and had a vaguely IT related student job for three years. The classes and degree were largely worthless, outside of being able to tick the box on applications. The student job taught me a little bit, but the majority of my marketable skills are self taught. I did freelance work for about 18 months directly prior to graduation and was able to leverage that experience into an excellent and stable job offer at 23, which I'm still happily employed by two years later.

If you are ambitious and "want it" badly enough, the lack of a degree shouldn't slow you down, and if you aren't ambitious or don't "want it" then no degree will magically make you marketable. Most ambitious will probably choose to pursue the degree anyway, so it's self fulfilling to an extent. The point of the article stands sharply though, the "experience" isn't worth the cost, and the debt we incur is choking other parts of the economy. How many millenials do you know that drive a brand new vehicle or own their own home?

Re: Our sons' student debt is delaying our retirement

#62

Post by FireBeyond »

JPKab wrote: post #34
carsongross wrote: post #10

a bachelor's degree in journalism and media studies. He's especially interested in a Hollywood career, but has found it hard to land a job there. These folks went into debt to the tune of nearly 4x the average american pre-tax income, for a theater degree. No, the lenders shouldn't have let them do that... but come on.

Agreed. I went to an affordable, in-state university. My father was wise enough to advise me that I was taking on debt for myself, and should think very hard about the economic consequences of my decision. Some parents are just way too nice to their kids, and these two are in that bracket. I've found it very amusing as I've grown up to notice this is a pattern in otherwise well-meaning, financially successful baby-bo…

I've always found that to be a cultural oddity. Growing up in Australia your parents almost never paid for your first car. I'd estimate 1% or less. And it was a source of pride. Your first car might have been a barely roadworthy beater/clunker but it was yours.

Here in the US, there's still some expectation that there's a good chance that, if your parents can afford it, they'll buy your first car. Certainly not an absolute, but definitely a much more commonplace expectation.

Some of this is due to other factors too, admittedly. Parents in the US seem to spend more time as chauffeurs than in Australia, often due to the mostly inferior public transit systems.

Re: Our sons' student debt is delaying our retirement

#63

Post by cpursley »

Throwaway12141 wrote: post #47
n0us wrote: post #23

"Sean is now pursuing another bachelor's degree, this time in computer science, from the University of Mary Washington in Fredericksburg. He is paying for this degree as he goes, with help from an internship program with the U.S. Navy." Smart move. Maybe he will pay it all down some day. In this thread there are a lot of people saying you shouldn't take out a lot of loans to get a degree like journalism, and you shou…

> "Sean is now pursuing another bachelor's degree, this time in computer science, from the University of Mary Washington in Fredericksburg. He is paying for this degree as he goes, with help from an internship program with the U.S. Navy." ... or he could have just driven 40 minutes north and gotten a CS degree at George Mason University, which is a far, far better program than Mary Washington. OR if out of state tuit…

There's another option that's even cheaper. My training to enter software development was less than $1,000 (various books and online courses + plus lots of hours behind the keyboard). While that might not provide a deep CS background, its enough to become a competent developer to build real things and obtain a job. And if someone feels like they still need that CS degree, do so after entering the field and pay tuition out of pocket along the way.

Re: Our sons' student debt is delaying our retirement

#64

Post by monroepe »

vkjv wrote: post #48
monroepe wrote: post #2

A Bachelor's degree doesn't really do that much for you these days. It's become like a high school diploma was 30 years ago (which almost no one paid for). I keep trying to advocate that people not go so far in debt for a college degree. For med school or law school (although I would argue that this is not a great investment with the current glut of law school grads) it makes sense to go into debt of that size. But I…

I agree with the sentiment but I think somewhat higher loans are reasonable. The rule of thumb that I use is total student debt shouldn't exceed the normal starting salary for a job in your field. If you are getting an engineering degree, go ahead and feel free to drop $60k+ on an education, but if you are going to be a teacher start looking for grants.

I see what you are saying and there are definitely certain fields where it makes sense to take on more debt than the $10k-$20k I suggested. I think another factor to take into account is financial maturity. Some people are better situated to handle larger debt than others. I am fairly frugal at this point in my life, but I am not sure I could handle the pressure and the need to budget with an extra $744 payment towards loans every month like mentioned in the article.

Re: Our sons' student debt is delaying our retirement

#65

Post by will_brown »

otterley wrote: post #57
will_brown wrote: post #52

It is important to know and not perpetuate the myths about student loans... -Federally guaranteed student loans can be discharged in bankruptcy (it is just a different standard than other debts); and -Federal plus loans (a type of educational loan for parents) can also be discharged, not just through bankruptcy but also directly through the US Department of Education, for example one program is for permanent and tota…

> -Federally guaranteed student loans can be discharged in bankruptcy (it is just a different standard than other debts) As a practical matter, it is not dischargeable. The standard is nearly impossible to meet.

>The standard is nearly impossible to meet.

Not really, the standard is "undue hardship". The problem is the myth...Of ~900,000 bankruptcy filings in 2014 only ~700 listed student loans as a debt to be discharged, of that number do you know how many were successfully discharged? The truth is of ~900,000 bankruptcies vastly more were eligible to have student loans discharged but didn't because they didn't even try.

As a lawyer I have personally worked with a client to have a >$100,000 parent loan discharged directly with the US Dept of Education, and in no way would this client come close to being eligible for a normal bankruptcy.

Re: Our sons' student debt is delaying our retirement

#66

Post by GFischer »

cpursley wrote: post #53
lxmorj wrote: post #29

Earlier quoted context omitted.

What happens if you stop living in the US? (I realize very few people would do this, but I'm curious)

If you leave the US, you don't stop being a US Citizen unless you revoke your citizenship. And most nations won't allow you to become a citizen if you have foreign debts. Also, expect to see more of these types of rules, since many student loans are backed by US Government entities: http://www.usatoday.com/story/money/personalfinance/2015/12/... > A new enforcement provision passed by Congress and signed into law ear…

"most nations won't allow you to become a citizen if you have foreign debts"

How will they know? AFAIK, my country, which has pretty lenient rules, only asks for proof of no criminal record at the time the application is filled.

On the other hand, you can and will be extradited to the U.S. if you were found breaking their laws and their legal system does ask.

Re: Our sons' student debt is delaying our retirement

#67

Post by intopieces »

replicatorblog wrote: post #58
intopieces wrote: post #28

Earlier quoted context omitted.

>I think we need to do more to help educate parents and prospective students that in most cases a college degree is next to worthless. Do you have a source for this? The Bureau of Labor Statistics says the exact opposite. [0] >Most psych/business majors would be better served working their way up through the ranks. Source? Again and again, people only seem to look at the cost of education like education is a product…

Here's a source that shows a correlation between ice cream sales and homicides: ( http://www.slate.com/blogs/crime/2013/07/09/warm_weather_hom... ). I'm sure if we unpacked the BLS data you cite we'd also see a correlation between higher earners coming from intact families and the possession of other forms of social capital in addition to a degree. The question is which is the dominant driver? As for the citations yo…

>Because we treat it like a rite of passage for young adults, and subsidize it heavily, you have horrible colleges offering degrees at the same price as elite schools.

It's not the rite of passage that raises the cost, but the cheap student loans that incentivize colleges to raise the price of tuition and hire middle-level administrators. This says nothing of the 'value' of education, only the 'cost.' I'm with you that college is too expensive. But the solution is not forgoing education so that the ultra rich continue to have better opportunities. It's making education cheaper so that more people gain more knowledge.

And apparently our society doesn't take this rite of passage too seriously, since only 40% of Americans have a college degree [0].

>I don't understand the reflexive desire to turn the protection of 3rd rate colleges into a cause célèbre.

Me neither. But the existence of third rate colleges is not an indictment of colleges. The post I responded to of yours said that "in most cases a college degree is next to worthless". I'm taking you to task on that claim as being demonstrably false.

I'm sorry that you didn't get what you wanted out of college, I truly am. But please stop advocating for the wholesale elimination of the most accessible path to success for millions of low and middle-income Americans who are not exceptional. (You advocated for this when you suggested we tell parents the college education they hope their children can get is "next to worthless.") More educated adults means a more informed electorate and the higher chance of American innovation that allows the country to be competitive in a global market.

[0]http://www.pbs.org/newshour/rundown/percentage-americans-col...

Re: Our sons' student debt is delaying our retirement

#68

Post by pigpaws »

wmil wrote: post #36

The real solution to this is to open up some kind of bond market for majors. Bundle up a bunch of student loans by major and create a partly public partly private debt obligations. Schools have far too much incentive to lie about the value of different degrees. Parents and high school advisors don't have the necessary information. A market device would give students the feedback they need to plan their futures. Plus…

large corps already complain about not having enough 'skilled' labor, so they just abuse the H1B visa system. They don't actively invest in the skill set of their own workforce, let alone that of the upcoming students.

Re: Our sons' student debt is delaying our retirement

#69

Post by treerunner »

No doubt higher Ed is a mess in the US but this could just as easily be an article about attachment parenting gone array. The article mentions that their son is waiting on a dream career in Hollywood. One would think that critical skills gained from a media studies degree would be useful in unpacking the myth of cracking into the big time. Perhaps he would have a better chance if he took himself out of the multitudes of the uninspired waiting to be discovered and instead did something to help his family with their problem.
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