Student loans

[red-beard]

Jack,

The issue is that people are taking out loans that have no chance of paying them back. It is not that I think that only _____ should be funded, but you should have to show you will have the ability to pay back the loans. And this should not be limited to type of degree, but also grades.

A person with an engineering degree with a 2.0 GPA, isn't going to find it easy to get a position, unless they have some other skills. A person with a BA degree in 1st century latin poetry isn't going to find it easy to get a job either, no matter their GPA.

One of my buddies decided to go to Medical School. He used his GI Bill (or whatever it is called), went to school in 2 year school, transferred to a 4 year school and spent minimal money. He worked while going to school. Eventually he was accepted at a medical school. He finished and is finializing his residency. He has minimal loans because that was his plan. I am proud of him.

[jcommin]

I just finished doing a college search for my youngest. The story that comes out the most is "what is your major" Freshman usually respond " I don't know or I have changed my mind".

I agree with most of the comments here - There isn't a one set answer.

Most of the home building trades in Chicago are populated with Eastern Europeans and Hispanics. Many contractors are out of business as most cannot compete with the lower labor rates of those groups. Commercial building is down also. What I have seen is lower labor rates of the commercial builders and most will discount to get the work. It isn't that easy.

There are many machine shops here in Chicago that have Eastern European workers and again there is a hourly rate differential between these workers.

That's the trend - two tier labor rates.

I personally do not want son to take on huge debt but I do want him to have "skin in the game". It is not a free ride.

[74-911]

Originally Posted by red-beard

The issue is that people are taking out loans that have no chance of paying them back. It is not that I think that only _____ should be funded, but you should have to show you will have the ability to pay back the loans. And this should not be limited to type of degree, but also grades.

James,
I agree, this is a very big problem but how do show the ability to pay back the loans when you are 18, just out of high school and have no idea what you want to be when you grow up? Are we eliminating a lot of highly motivated but low income students who don't know what career path to chose and have no parental guidance, etc. to help them?

I financed my way through school checking groceries in a grocery store and with the old National Defense Loans. With those you had to show the economic need and maintain good grades. I certainly couldn't show I had the ability to repay them and the first year or two I had no clue has to what I would really major in and I think this is often the case.

From my understanding though, a very big part of the problem of the massive student loan debt is not colleges and degree plans but the for-profit trade/technical schools which is a whole nother ball game. This is one area the government probably needs to really crack down on as some of these schools are apparentlyt totally useless.

I certainly don't have the answers but your last example of how your doctor friend got through school contains the seed to the real answer.

[Burnin' oil]

Just like everything else in this world, I don't understand.

What rational person will borrow tens of thousands of dollars when doing so will create a financial hardship down the road?

What rational parent will allow their child to borrow tens of thousands of dollars when doing so will create a financial hardship down the road?

What financial institution will loan tens of thousands of dollars when doing so will create a financial hardship down the road?

The obvious answer is none until, as many pointed out, you create a system that is not rational.

[gprsh924]

Rick it's something I don't understand but it does seem like no one is graduating in 4 years. Makes zero sense to me. All of my friends graduated 4 years. We all make money and have our lives together. It's not that hard. You don't even need to be that smart you just need some drive.

Matt you're right, college isn't for everyone. At the same time, I think there can be a lot allure to making "great" money right now that won't be so great 10 years from now and you've given up your opportunity to invest in yourself and life kids bills are more important now.

[scottmandue]

Originally Posted by Burnin' oil

Just like everything else in this world, I don't understand.

What rational person will borrow tens of thousands of dollars when doing so will create a financial hardship down the road?

What rational parent will allow their child to borrow tens of thousands of dollars when doing so will create a financial hardship down the road?

What financial institution will loan tens of thousands of dollars when doing so will create a financial hardship down the road?

The obvious answer is none until, as many pointed out, you create a system that is not rational.

Logic? Rational thinking? THAT IS JUST CRAZY TALK!!!!

[RWebb]

Originally Posted by Rick Lee

A close family friend went to Amer. Univ. for archaeology. Everyone thought she was nuts. From the summer before her senior year she was never unemployed for a single day. She traveled the world working on digs, living the dream. I've rarely met anyone whose studies and career were more fulfilling and geared toward their dreams and personality type.

Arch. is another xlnt. example of the unpredictability of a major. It used to be a dead end - or a chute into the unemployment line. Then the Antiquities Act was passed to preserve some of our heritage - suddenly they were in huge demand.

Guy - most financial support from a univ. will include a work component.

[Cajundaddy]

Honestly I don't know how anyone gets through Med school without student loans, but starting life $500k in the hole after giving up 8-10 years of your life? That's a long hard road that needs to be considered very carefully.

For the rest of us, figure out how to get it done without loans for the 1st four years. After a demonstrated track record of excellence in higher learning, a loan for a Masters or PhD might be worthwhile depending on the field of study. For the 2% of extraordinary HS students who have the grades and desire but not the funds or family backing, a loan to cover tuition while they work to cover expenses makes sense. Tacking on a balance due of $100k+ for every Bachelors degree is simply madness.

[Burnin' oil]

My oldest son was able to complete his studies in 2.5 years at minimal expense and no debt.

My oldest daughter is wrapping up her second year at a state university - unfortunately for her, she lives at home. The cost is less than $7,000 per year which I cover. I wish she could have gone away to school, but I can't afford it and we don't qualify for any financial aid.

I went to a private College that was $15k a year 30 years ago and paid for it all myself. I graduated with $7k in debt. That same school today is $50k and offered my daughter a $10k academic scholarship. Bite me, you dumb-ass over-priced elitist school.

I still have three more kids in private school that will probably go to college, unless I can talk them out of it. Stop the bleeding . . .

[onewhippedpuppy]

Guys, several of you picked up on the issue, perhaps unknowingly. If I ask my kid "what's your major" and his reply is "I don't know", I'm not spending a dime on college. College is a very expensive way to figure out what to do with your life, something that can be uncovered while working post high school.

Like most kids I went to college straight out of high school. I was a mechanical engineering major, then I changed to business, then I got kicked out. I took a year off, went back for a year, then quit because I knew business wasn't for me. After some time in the real world I went back (married, kids, job) with focus and motivation. I earned an Aerospace Engineering degree with a business minor taking up to 21 hours per semester. I'm currently working on my MBA. The only difference is that I know exactly what I want and I'm well motivated. The real world has a way of doing that...

[VincentVega]

Glad it worked for you but that doesnt mean it's the only way. I had no idea what I wanted to do in college except play football. Great plan huh? Most kids with half a brian figure it out sooner than later, some just take a little longer.

Besides, going away to school was a lot more than job training.

[Rick Lee]

I picked political science very early on because I wanted to be a Foreign Service Officer. That dream died after I didn't pass the test the second time, though I took it for fun two years ago and did pass the written one. Anyway, you'd think pol. sci. isn't the most marketable degree. But I moved to DC the week the new GOP Congress took over in 1995 and that's where I got my first real job. It was awesome for a few years and no one cares about my degree anymore.

[onewhippedpuppy]

Originally Posted by VincentVega

Glad it worked for you but that doesnt mean it's the only way. I had no idea what I wanted to do in college except play football. Great plan huh? Most kids with half a brian figure it out sooner than later, some just take a little longer.

Besides, going away to school was a lot more than job training.

Fair enough, but I'm not paying a small fortune for my kid to go "find himself". You can discover just as much (if not more) about yourself by moving out and getting a job.

[id10t]

Originally Posted by onewhippedpuppy

Fair enough, but I'm not paying a small fortune for my kid to go "find himself". You can discover just as much (if not more) about yourself by moving out and getting a job.

Especially if you can work in a place that has lots of different professions going on like a hospital

[tweezers74]

Originally Posted by wdfifteen

If there is an abundance of candidates for a particular profession the earning potential is going to go down due to supply and demand and it will become harder to get loans for that major. The bottom line is - will you be able to pay off the loan? Stability, personal growth, etc are all wonderful, but should an individual get them at someone else's expense? What does it do you a person's personal growth to know they owe thousands of dollars that they can't pay back?

You misunderstood what I referred to as "stability". I mean stability of the profession, not the person. Like I mentioned, nursing won't make me rich but I guarantee that I can pay my bills. My salary is stable. Layoffs as far as nursing are not as extreme and common as in other professions, IF you are a good nurse.

I agree with Redbeard. Just as you have to apply for a car or mortgage, you should have to do the same for school loans. And since you most likely don't have a lot credit, you have to base it on other factors like GPA or interviews to present your "business plan" on how your choice major will lead to career success and to your specified "dream job". If the process was that rigorous, it would be a self weeding out process. People who aren't go-getters and ambitious probably won't pursue that process because it would be too hard. The process as it stands today is too easy. Kids see it as "free" money. I had a roommate who took out a crap load of student loans and ended up dropping out. She spent "her" money on restaurants, going out, and her sorority dues. I remember her teasing me because I scraped up every penny, working as a waitress to pay my rent even though I had a full ride scholarship. She told me I work too hard and should just take out a loan. If I would have followed her advice, I would have graduated with debt instead of NONE!

[VincentVega]

Fair enough, but I'm not paying a small fortune for my kid to go "find himself". You can discover just as much (if not more) about yourself by moving out and getting a job.

I hear you and you make a good point. I'm not saying the wallet is open and jr gets whatever they want, that's a personal decision I guess. Thing is, if my folks required me to have my future figured out before they send me off, I most likely never would have gone to school.

I busted my ass working until I had the skills to not have to. Now I spend my free time doing much of the same work on my stuff for free. What's wrong with this picture?

[Porsche-O-Phile]

I'm against the grain of most here. I did take student loans for my education and pretty substantial ones at that. I don't see it as a waste. I am paying them back and will one day have them paid off. That's fine. It was an investment in myself - what I'd consider an appropriate thing to take debt for. By contrast taking on debt for junkets to Hawaii, booze and cigarettes is NOT sensible as there's no long term ROI.

I don't mind paying a few hundred a month to pay for the education I got - it enabled me to gain self-respect, a good job in a field I like (where I don't have to wear my name on my shirt or say "do you want fries with that" or punch a clock or worry about my knees/back getting blown out by the time I'm 45). Those things have a lot of value and as such they're worth paying for. I may not be rich but I at least have the potential to be if I want and it's that important to me. I live okay and do fine. I can pay my bills. The biggest thing to me is having self-worth and self-respect and that comes from working to one's potential, not below it and certainly not copping out and getting a McDegree or no degree so one can go hang out with his/her high school buddies in a dead- end job while life and the world leaves them in be dust.

My point is that college is not all bad and a lot of the price is for intangibles like security, stability, regularity, quality of life, etc. I imagine hopping from one job site to the next to the next and never feeling like you "belong" anywhere professionally gets old pretty quickly. No disrespect at all to those who can or do manage to do it, just saying it's gotta be hard. I enjoy being able to be out of the office 1-2 days a week on site and have a regular place to go on the other days. I don't had to be awake at 4:00 am and I'm usually home by 6 and I'm not smelling of BO or grease or cow manure. That's pretty good to me and makes me think that the loans (and payments I make towards them) were money well spent. I (generally) like my life but realize others may have different ideals. But I'll still be working/earning when I'm in my 60s whereas someone else might be eating dog food because they three out their back 20 years earlier and have been stuck on disability since. Just sayin' - no silver bullet of one-size-fits-all formula.

[911SauCy]

Originally Posted by Rikao4

you have 2 dumb things...
the 'student'..
Government involvement..

as far as the trade (blue collar ) folk...
nuthin but respect from my end..
just a mechanic some may say....
well I have to make an appointment to see him..

Rika

Shouldn't have wasted her time at college...

Get a job at Starbucks or in the government...

[onewhippedpuppy]

Originally Posted by Porsche-O-Phile

I'm against the grain of most here. I did take student loans for my education and pretty substantial ones at that. I don't see it as a waste. I am paying them back and will one day have them paid off. That's fine. It was an investment in myself - what I'd consider an appropriate thing to take debt for. By contrast taking on debt for junkets to Hawaii, booze and cigarettes is NOT sensible as there's no long term ROI.

I don't mind paying a few hundred a month to pay for the education I got - it enabled me to gain self-respect, a good job in a field I like (where I don't have to wear my name on my shirt or say "do you want fries with that" or punch a clock or worry about my knees/back getting blown out by the time I'm 45). Those things have a lot of value and as such they're worth paying for. I may not be rich but I at least have the potential to be if I want and it's that important to me. I live okay and do fine. I can pay my bills. The biggest thing to me is having self-worth and self-respect and that comes from working to one's potential, not below it and certainly not copping out and getting a McDegree or no degree so one can go hang out with his/her high school buddies in a dead- end job while life and the world leaves them in be dust.

My point is that college is not all bad and a lot of the price is for intangibles like security, stability, regularity, quality of life, etc. I imagine hopping from one job site to the next to the next and never feeling like you "belong" anywhere professionally gets old pretty quickly. No disrespect at all to those who can or do manage to do it, just saying it's gotta be hard. I enjoy being able to be out of the office 1-2 days a week on site and have a regular place to go on the other days. I don't had to be awake at 4:00 am and I'm usually home by 6 and I'm not smelling of BO or grease or cow manure. That's pretty good to me and makes me think that the loans (and payments I make towards them) were money well spent. I (generally) like my life but realize others may have different ideals. But I'll still be working/earning when I'm in my 60s whereas someone else might be eating dog food because they three out their back 20 years earlier and have been stuck on disability since. Just sayin' - no silver bullet of one-size-fits-all formula.

I can't speak for everyone, but I never said that you shouldn't do student loans. My statement is that your major investment in yourself should have a payback at the end. I graduated from college with $45k in student loan debt and an engineering degree, which I busted ass to pay back in two years. I would do it again in a heartbeat because the payback has been significant. The problem is those who graduate with big debt and don't have the means to pay it back. You're an architect, right Jeff? That's a real degree that will get you a real job, totally worth it in my book.

[Porsche-O-Phile]

If I can stay employed it'll all be fine. If not, well... It'll suck. And there are a lot of people in this line of work that have ended up in exactly that predicament. Engineers too. But it's risk/reward. No guts no glory as I see it. Yes I could get really screwed by the job market but I could get screwed in just about any job the same way. There's no "safe harbor" or "sure thing". There are even MDs out of work right now but statistically those with advanced professional type degrees have lower unemployment rates and it tends to suggest that it's a good gamble if one is reasonably dedicated and stays hungry.