Can you say college loans? Can you afford a college loan? These are questions that are plaguing young Americans who are just coming out of college and are preparing to go to college.
A recent article titled the stunning truth about how students are spending loan cash is very sobering. Over the last 15 years the starting salary for a college graduate has declined $4000 a year. What a dream robber! We see students with stars in their eyes going off to college to prepare themselves for a future prosperity and to be as their parents would tell them, “better off than the last generation”. But statistically there worse off! Not only are they making fewer dollars but over the 15 years those dollars are buying less.
But this isn’t the worst of their problems. The article tells us that the average student debt upon graduation is $37,000. And because they’re making less if they can find a job at all they have no idea how they can pay the loan payments.
A graduate needs to be reminded that a student loan can never be bankrupted, in other words the debt will stay with them until it is paid.
A person shouldn’t talk about a problem if they don’t have a solution to that problem so what is Henderson and Floyd’s recommended solution?
1- Weigh very carefully the desired outcome of a college education. As a former public educator I often heard a high school senior say to his friends or to me they were going to go to college and see what interested them. That seems like a very expensive research project. Certainly parents, advisers and mentors could better open the possibilities and opportunities to a potential student at a considerable savings.
2- Don’t be afraid to ask a student work during the time they are in college. Parents have given their child so much that to also risk their future retirement may not be a good solution. Be aware that a young person can be stretched far more than today’s environment seems to require. Experience teaches us that when you have to work for something you value it more.
3- If you have the good fortune of reading this early enough in your child raising years, take a moment and watch the video on our website relating to education. Our strategy will allow you to help your child pay for their education then pay you for that education and retire with the same dollars. And by the way if you follow our system your child will receive the money back to be used for your grandchildren’s education.