“Wars in old times were made to get slaves. The modern implement
of imposing slavery is debt.”
~ American poet Ezra Pound (1885-1972)
I found the following scary snippet in the Huffington Post today. The full article is at http://www.huffingtonpost.com/steve-rhode/father-forged-kids-names-_b_8251580.html.
My ex husband left 2 of my children with over $100,000 each with student loan debt. He signed loans with their names without their knowledge, he missed months of payments which incurred high interest rates and now these kids both under 30 are saddled with these debts…. ”
I can’t vouch for the truth of this letter. I can tell readers that a Google search on the topic of forged student loans returned “About 351,000 results (0.60 seconds).” Forged student loans are no orphan-disease topic.
My best guess is dad was supposed to pay for his kids’ college education and did not want to fork over the $$$ or did not want to admit that he did not have the money. He then sneakily put the costs onto his kids. The article suggests pursuing dad, which might be the best option, except dad could actually go to jail. I don’t think I could have put my own dad in jail.
The kids’ options are ugly, uglier and ugliest. I hope those degrees turn out to be worth the stress and broken family ties that are likely to result.
Eduhonesty: I can’t blame the-college-for-all agenda for this mess. But I did decide to post this because of the number — over $100,000 each. At 5%, paid over 20 years, monthly payments come in somewhere around $700 per month. The exact interest rate is hard to know since with amounts this large, only some loans will be federally subsidized. That 5% estimate most likely is low. It’s hard to say since loan rates jump up and down.
A debt of $700 per month is absolutely crippling for an undergraduate degree. A graduate in chemical engineering might be able to manage this sum, but the vast majority of liberal arts graduates will have to pay all their disposable income to meet this target — or go into default.
My first practical piece of advice: Loan interest rates are lower right now than at some times in the past. If you have a former student who is struggling, encourage that student to attempt to refinance their loans.
My second practical piece of advice: When Maisie tells you she plans to go to an expensive private college to study psychology, please sit her down and go over debt scenarios carefully. The internet has tools to show what future monthly payments will be. Show her what debt means. Show her the numbers. We are busy encouraging big dreams. We need to stop glossing over their cost.