It’s no secret that college is expensive, and that excessive college debt is creating a lot of hardship for many people in the United States. During this college application season, parents and students are working out their college funding plans. For many families, loans will be part of the way they pay for college.
While college loans can make college possible, most students don’t have the experience to understand how those loans will impact their post-college lives. It’s up to parents to to explain, in clear language, how much they can afford to pay for college. Parents can also guide their child toward a college that fits their budget, understanding that the net price may be nowhere near the list price, and considering all merit and need-based aid for which the child may qualify.
The Big Loans Are Parent Loans
No undergraduate can take out bjillions of dollars in college debt without at least a co-sign from a parent. The typical college student has an undergraduate limit of $31,000 in federal loans. Independent students, or those with parents who do not qualify for parental loans, have an undergraduate maximum of $57,500 in federal loans.
When you hear about really big loans for undergraduate education, these loans are coming from parents taking out or co-signing private loans.
What Parents Need To Do
Parents have a lot of responsibility in the college search process. Things they need to do:
- Talk to their kids about how much their family can/will contribute to college
- Consider the cost of colleges when college shopping
- Burst the idea of a “dream school” without regard to cost
- Take the time to learn about the financial aid process before making college decisions
- Refuse to let their kids take out tens of thousands of dollars in student loans each year, without regard to their ability to repay them
Parents, please do your jobs and guide your kids to smart decisions about paying for college. I understand that the costs is overwhelming, and it feels easier to to throw up your hands and give in to excessive loans. Please don’t. You’ll be making your child’s life, and your life, much easier.