Student Loans

[Disneychick13]

I do get some feelings of angst for those who already took on so much and paid it off. It's not a good reason to leave things be but they can be made whole with some tinkering.

Personally, I would be fine with reaching back with tax breaks to those who paid interest on old loans because it could be reasonably argued the wealthy wouldn't have used loans in the first place and if you started poor with loans and ended up rich, good for you, that is the American Dream isn't it? Most of the world educates its people and somehow we've been convinced it's not ok to do here,ummm says who? Expensive, sure, but we seed billions all over the world and nothing ever changes, enough already, I want US money here and I want it now. Dump the cost on top of that ridiculous pile and let the nose bleed wealthy sort it out in a street fight.

Well, people have always gotten tax breaks for student loan interest….up to 2500 a year I believe.

 

[mjkacmom]

Respectfully, you did something wrong.

If they got into Villanova, they would have gotten into some other comparable universities that meet 100% of financial need beyond the maximum Federal loans of $31,000.

Villanova was the first school I got into, and I was devastated because the financial aid was so crappy that I thought I wouldn't be able to go to college. Then I got into Notre Dame and Boston College the next day and their need-based aid was incredibly generous.


Holy crap if you're going into a $150,000 graduate program, you better have prospects far more solid than "should be making 6 figures."

I think Villanova was actually the only school that offered any FA, I think it was $8000 a year which doesn’t even touch the $70,000 a year. I don’t know when you went to college but my youngest started in 2014 and things have changed even since then. As for her graduate program, it’s to get her doctorate in PT, a career she’s been interested in since she was 13. Many encouraged her to go to med school, but that’s $300,000+ and she really wants to be a physical therapist. She works to pay for rent and food which is about $1500 month.

 

[mjkacmom]

If they came out with 80K in debt, they only did so because you co-signed.

I get it though. Each situation is different and has a different calculus. Normally I would just say you do you, and guide your kids to make the best decision for them. And we'll do us. But once this moves to tax dollars forgiving someone else's loans, that calculus shifts greatly.

You live in an expensive area. Thankfully we have reasonably priced state schools. And our 2 who went away qualified for the highest scholarship levels that pretty much covered tuition (only had to put together room and board, which gives some flexibility to cut corners).

We did, and we have been co-sign released from our two oldest because their income is sufficient to have them in their names only. Yes, a very expensive area, no one I know is eligible for FA because if your income is that low you probably can’t afford to live here. Our in state schools are expensive. Fortunately my kids are very bright and motivated, at most their loans will take another two years to pay off, and they have safety nets, contribute the max to their 401k’s, own their own vehicles and have fun money.

 

[mom2rtk]

We did, and we have been co-sign released from our two oldest because their income is sufficient to have them in their names only. Yes, a very expensive area, no one I know is eligible for FA because if your income is that low you probably can’t afford to live here. Our in state schools are expensive. Fortunately my kids are very bright and motivated, at most their loans will take another two years to pay off, and they have safety nets, contribute the max to their 401k’s, own their own vehicles and have fun money.

I wasn't even talking about need based financial aid. I was talking about merit aid.

 

[Memorymakerfor4]

My sister turned down full tuition scholarships in state to go out of state because it was more exciting. She racked up $40K in debt and took 6 years to finish her undergraduate degree. Years later, despite an executive level job, she still makes the minimum payment and told me this weekend she's hoping the debt gets cancelled.

I took the state scholarship, put my head down, and paid off remaining debt in 3 years. As a teacher.

 

[Mackenzie Click-Mickelson]

Well, people have always gotten tax breaks for student loan interest….up to 2500 a year I believe.

But that is the max and if you're married that's all you get, you don't each get to claim $2,500.

**Yes there are reasons to file jointly if married just speaking towards this one part.

 

[mom2rtk]

My sister turned down full tuition scholarships in state to go out of state because it was more exciting. She racked up $40K in debt and took 6 years to finish her undergraduate degree. Years later, despite an executive level job, she still makes the minimum payment and told me this weekend she's hoping the debt gets cancelled.

I took the state scholarship, put my head down, and paid off remaining debt in 3 years. As a teacher.

So we should pay off the loans for an a person in an executive level job?

 

[Memorymakerfor4]

So we should pay off the loans for an a person in an executive level job?

Not at all. Maybe I wasn't clear, I was trying to highlight that I think it's unfair to cancel student debt. I made hard choices to do without a lot for 3 years to pay mine off and it frustrates me that there's a good chance the tax dollars I pay will also have to pay off someone else's.

 

[Disneychick13]

But that is the max and if you're married that's all you get, you don't each get to claim $2,500.

**Yes there are reasons to file jointly if married just speaking towards this one part.

Correct. Just replying to the PP that said it would be nice if people got a tax break for interest paid in the past. To say that they already got a break.

 

[Sadeesmom]

I really hope none is forgiven, but that interest is capped at prime +2% for all future loans.

Forgiveness is a slap in the face to those who worked their butts off to not take out any loans & those who buckled down after graduation to pay them off.
Forgiving does nothing to stop the problem; it only makes it worse when people assume it will happen again.

If the government is going to forgive student loans, why not all debt types? There is a reason student loans are not bankrupt-able: you cannot repossess an education.

 

[mjkacmom]

I wasn't even talking about need based financial aid. I was talking about merit aid.

Dd21 did want to stay in the northeast, got merit from every school (except Villanova but did get into their honors college). She was 8th in her class of 300, 34 ACT, 9 AP classes, rest honors, one B freshman year. Unfortunately I think the cut off for the highest scholarships called for a 35/36 (at least at her school, she got the top before full tuition). She did move off campus sophomore year to save money, and graduating a year early saved $30,000+.

 

[OKbyme]

Didn't know this was a thing again. Big announcement before presidential election and then did not happen. Now we are looking at midterm elections, so figures that carrot is being dangled again.

I have had 3 kids go through college over the past 9 years. They all have the federal student loans, youngest also had a graduate loan, so she will owe $32500.

They all went where the federal student loans would cover the costs, along with scholarships/aid, & some help from us; each got $6000 from us towards their college expense. Girls needed it during college, son got it after graduating for down payment on a car.

On a college forum, it is easy to see how so many kids ended up with too much debt, due to the incredibly horrible advice the parents give/gave. The parents seem as enamored of "prestige" of a college worse then their kids or specific areas of the country because they need to be progressive. And they will be the first ones complaining about the high debt. Seen it happening for years.

 

[rasclautmangos]

I had a financially irresponsible parent who guilt tripped me into getting more student loans than I needed so that I could send money back home for bills and the care of my sibling. What an idiot I was lol. I have about $65,000 in debt including interest as of now. It would be great if interest was canceled, but I'm not expecting anything.

 

[Lilias]

It's very frustrating when you get forced to do something at a young, vulnerable age ("You HAVE to get a degree! ANY degree! To get ahead!" - every adult) with no help from your parents. Because your parents are so poor, congrats, you get the federal loans with the GOOD rates! Everyone celebrates you being the first in the family to go to college. Nobody questions or challenges your choice for a Liberal Arts degree because you are SO, SO SMART and can Do AnYtHiNg. You can either have a full ride at a state school, or just pay for a little bit of the really nice independent school that you liked better. Your poor parents just want you to be happy and successful, so you go to the better school without a regard for the cost. Your wee 18 year old brain thinks that $40,000 will get paid off in no time when you're a fancy adult.

Then you graduate, and the job market is so oversaturated everyone backpedals that it's REALLY UNFORTUNATE that you're entering the workforce right now. After months of searching and starting to remove your new degree from all your applications, you finally get a call center job paying $10 an hr, consider yourself lucky because all your friends are working retail jobs for minimum wage, and start diligently paying your income-based loans. Except, the payment doesn't even cover the interest (but you don't know that yet). And also the job is so traumatic that you're still kindof afraid of talking to people on the phone. BUT the experience enables you to get a job at an office for a few more bucks an hour. Nice. You keep paying the loans. The payment is manageable and you try not to worry about the interest piling up.

You get married at some point, and now your spouse's income gets added to yours and so your loan payments go up hundreds of dollars to become the same amount as your rent. You now have to pay two rents a month. The interest has gotten insurmountable. You call your loan servicer crying, they suggest you get a divorce or file your taxes separately going forward. They also mention that you should never, ever, EVER consolidate your many loans. So, you don't. And the extremely small tax breaks you had been getting for your loan interest? Gone when you file taxes this way!

The office you work at is a tax exempt organization, so you're promised loan forgiveness in just 10 years. There is a light at the end of the tunnel! While checking one day about 7 years in, you notice that, wait, only about $5000 of your now $50,000 pile of debt qualifies for forgiveness because the representative on the phone 5 years ago told you never to consolidate, when you really should have consolidated. Things get REALLY dark once you realize you've wasted years of your life at a job with no raises/no way up and you're even more in debt than when you started.

New president fixes the public service loan forgiveness program (almost as soon as you realized you had been screwed, too, so that was weird--thanks universe?) and you're back on track for the loan forgiveness, but your friends still can't buy houses because their student loan debt is too high to get a loan approved even though they're managing the income-based payments fine.

~
Just some perspective for ya from one of the Millennials you probably hate

Fixing the Public Service Loan Forgiveness program will help eliminate a LOT of the debt for many people (some of my friends are already free now that the program got fixed!), and I think the payments pause is an attempt to get a lot of us forgiven asap under that program to get the total debt down. Which is cool.

 

[TwoMisfits]

If we want to pay off student loans, it should be a 1-for-1 hit to college endowments - how much we tax them could pay for how much we forgive. If that got floated as the solution, I guarantee the talk of any student loan forgiveness would just disappear b/c those huge non-profits are anything but non-profit, and when you go after the folks who actually benefitted by getting paid full tuition thanks to all these loans - well, they won't be so fast to support this solution (b/c right now, colleges stand to benefit enormously from student loan forgiveness)...

 

[Kestryl]

But that is the max and if you're married that's all you get, you don't each get to claim $2,500.

**Yes there are reasons to file jointly if married just speaking towards this one part.

You also can’t claim it at all if married filing separately, which is recommended for some student loan borrowers to keep their payments lower/manageable.

 

[mrodgers]

No it isn't. I paid my loans off (had about $70k graduating into the recession in '09 when it was incredibly difficult to find a job) and I would be perfectly happy to see others not have to struggle with theirs.

I would not benefit from any forgiveness (if the income threshold stays where it is being discussed), but I have no problems if others get their loans forgiven. My taxes pay for all kinds of stuff that I don't necessarily agree with. Taxes are for the greater good, not just things that I want.

But I do agree that we also need to fix the root cause of the problem, this sky high tuitions, the predatory lending practices, high interest rates, etc.

My taxes pay for a lot of stuff I don’t agree with. I would be happy if it went towards some form of student loan relief (namely forgiven interest).

Fantastic. Go ahead and pay someone's student loans for them. I struggle. I would like to live in a home like normal people. I can't afford a home for myself, but I should be paying taxes to give to kids for their gender studies degrees? How about someone buy me a home to live in before telling me I should be paying for other kids' college degrees.

 

[Moliphino]

Fantastic. Go ahead and pay someone's student loans for them. I struggle. I would like to live in a home like normal people. I can't afford a home for myself, but I should be paying taxes to give to kids for their gender studies degrees? How about someone buy me a home to live in before telling me I should be paying for other kids' college degrees.

You're struggling so everyone else should, too. Got it. Our taxes go towards all sorts of stuff I wouldn't choose to pay for, this would at least help average people.

 

[sam_gordon]

Stop and think for a moment. All of you parents... what would you tell your child if the child came home and said his teacher wasn't fair, that Johnny got two cookies and he only got one?

 

[Mackenzie Click-Mickelson]

Fantastic. Go ahead and pay someone's student loans for them. I struggle. I would like to live in a home like normal people. I can't afford a home for myself, but I should be paying taxes to give to kids for their gender studies degrees? How about someone buy me a home to live in before telling me I should be paying for other kids' college degrees.

Gender studies? Is this the new "basket weaving degree" trope??