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Pay for college or borrow?
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amother
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Post Thu, Sep 22 2022, 12:00 am
This would be a great question to ask Dave Ramsey on his show. People call in with such questions and he gives advice.

He will for sure say not to borrow, but he will help you understand why it's a REALLY bad idea...
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nicole81




 
 
    
 

Post Thu, Sep 22 2022, 12:36 am
Assume a loan won't be forgiven unless she's going into education in a high needs district (not private school) with a high needs license, or if she's going to work in other types of public service.

I took my first student loan over 20 years ago and am only now qualifying for one public service discharge plus the 10k. And I still have a balance. And I've been paying for many years. I'm not complaining and my large loan bumped my salary up by double the loan amount within a year and a half, so it was definitely worth it. I'm just saying loans are a long haul plan.

It's also not worth taking a loan to go to most private schools, nor for a degree that won't pay well.

Don't let all the angry people who say they should have taken loans, etc, influence your decision. This was a one time thing after a major crisis, that has never been done before and there's zero reason for it to be done again.

Now, if I had tons of money sitting around, I would pay cash for my kids' college. But I don't, and we don't qualify for financial aid, so it's on them to get academic scholarships and cover the rest with loans. That said, if the leftover is beyond the allowed Stafford loan amounts, they need to get more scholarship money, use their own money, or pick a cheaper school. So obviously I don't think taking student loans is a horrible idea, as long as it's for a degree that will pay off. There are income driven repayment plans that will make payments more manageable for your daughter. I do think taking parental loans or students taking private loans are a horrible idea which can and should be avoided.
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sara_s




 
 
    
 

Post Thu, Sep 22 2022, 1:11 am
How about the money you were going to use to pay for her college, and the money she was going to use, you deposit in an interest bearing account.
Then take the loan. Hopefully the interest rate there will be lower (or only a small delta)
And that way you aren't taking on risk. If the loan isn't forgiven- you/she can pay it. And if it is forgiven- she will have a nice savings account.
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