Grad school?

Discussion in 'General Parenting' started by tryingtobestrong, Aug 27, 2019.

  1. Just wondering if anyone has experience with grad school loans.. My daughter started grad school this May. We were told by the financial aid office that it would be in her best interest if someone could pay the interest on the loans while she is in school.
    She will be in grad school for the next 3 years. She will go straight through only getting 3 weeks off between semesters. The financial aid woman said that no one in her degree works a part time job because the curriculum is too intense.
    So she had to take a grad plus loan to have money to pay her apartment, food, gas and other bills.
    There is just no way we can pay her rent and spending money without her taking the grad plus loan. Also, we can't be paying the interest on her loans either for the next 3 years.
    Just looking to see if anyone has any experience in these loans.
  2. KTMom91

    KTMom91 Well-Known Member

    I took out grad school loans when I went back for my teaching credential in 1997. After I started working, I was not able to make the payment - it was more than my house payment - and they refused to accept a lower amount. I've paid of one of the three loans I took out, consolidated the other two, and I now owe nearly $100,000 on an original loan of $38,000. The student loan company only offered deferments and forbearance as options when I couldn't pay. I will never get this loan paid off. They will attach my Social Security, screw up my retirement, and they've already destroyed my credit.

    I understand that she's out of options - so was I. A single parent changing careers in her 30s - and I needed that loan to live on. Just tell her to be very careful with those deferments they so kindly offer.
  3. AppleCori

    AppleCori Well-Known Member

    You don’t say how much she is taking out in loans or what her degree will be in, but generally speaking, it doesn’t sound like a good idea.

    Nor does it sound like a good idea for you to jeopardize your future retirement by paying for things you can’t afford, even for your daughter’s education.

    My kids wrote for grants and scholarships to cover the majority of grad school; their professors helped them find and apply for them. See if this would be an option.

    It might be a better idea to delay grad school and work to save money to pay for the schooling, or go into the military if she is going into a medical or law degree program and have the military pay for it.
  4. AppleCori

    AppleCori Well-Known Member

    That’s horrible, KT. Our student loan situation is out of control.
  5. Doctorate of physical therapy and each yr the loan will be near $50k
    I don’t understand how the doctors do it. Hoping there are some grants available in her 2nd yr. there were none from the school for first yr students.
  6. AppleCori

    AppleCori Well-Known Member

    I just looked that up.

    The average wage is 82k and the top 10% earn $112k, the low end earns $55k.

    She will need to go to school for four years, at a cost of 50k per year?
  7. AppleCori

    AppleCori Well-Known Member

    My daughter’s husband is a surgeon, and I will tell you how he did it—he went into the military.

    No student loans, plus a salary while going to medical school and residency.

    He was able to save money and has no debts.
    Last edited: Aug 28, 2019
  8. Copabanana

    Copabanana Well-Known Member

    My experience is like KT. I had a balance of about 50k that ballooned to about 138k over the years. First, when I adopted my son, I could not keep up with the payments. They put penalties of double which brought it up to more than 100k. With interest payments adding up it went higher and higher. This is over a many year period. The most I ever got it down to is 90k. When I worked I paid 1000k a month. But the interest is so unrelenting, even at $1000 or $1200 a month, you pay very little prinicpal. I will die with this debt. The good thing is that it is non-transferble. Death forgives it.

    There is no incentive for me to pay it down, because I would rather the money goes to my son upon my death. I pay the minimum.

    It is a kind of debtor's prison.

    It is was a terrible error to start with the student loans. And mine were the most favorable type, guaranteed by the government.

    I hope that the loans are fully in your daughter's name and that you are not a guarantor.
  9. AppleCori

    AppleCori Well-Known Member

    This sounds more like a loan shark than a normal loan.

    I can’t believe this is legal.

    What kind of loans are these?

    I have never heard of this type of ballooning penalties.
    Last edited: Aug 28, 2019
  10. BusynMember

    BusynMember Well-Known Member

    It is. My niece got a PhD and is only 30 and owes $200,000. And she got scholarships too.
  11. AppleCori

    AppleCori Well-Known Member

    I hope she is making $300 per year, or the debt isn’t worth it.

    I feel terrible that we do this to young people who don’t understand what they are getting into.
  12. KTMom91

    KTMom91 Well-Known Member

    I was told there were no grants available for grad school, that my only option was federal loans. Because they are federal loans, I can't discharge them in bankruptcy, and they can attach my tax refunds (penalizing my husband, even though I wasn't married to him at the time I took out the loans) and my Social Security (taking up to 50%). This was at a private Christian university - and it was the most expensive mistake I ever made. i was miserable the entire time, and I'm drowning in debt with destroyed credit because of it.
  13. BusynMember

    BusynMember Well-Known Member

    Eventually my niece will be making a lot of money. Not sure how much.

    College isn't worth what it used to be. Depending on the major, it may be hard to get a job at all. Its disheartening.
  14. Copabanana

    Copabanana Well-Known Member

    These were United States Government guaranteed student loans. I was studying at University of California in a graduate program.

    This was a sweet deal for the banks. They had no down side. The incentive for them was to foreclose on the loans because they would get 100 percent return on their loan, because the government had guaranteed them. So. The government paid off the banks, and students like me were left with double the debt. The government idd not think they would lose because they could collect interest on 100k not on 50k that was originally loaned. Because student loan debt cannot be discharged in banrkrupty court. It can never be discharged. And I did a stupid thing. After a certain amount of time these loans would have lapsed. But I consolidated them which enabled the government to get even more favorable terms. But worse for me, it started the clock from the beginning again.

    I will never be out from under these loans. The sad part is my whole career I have worked for the government in jobs with underserved people, in locations nobody wanted. So my education benefited directly the government.

    I think the only career that makes it worthwhile to get these loans is medical school.
    Last edited: Aug 28, 2019
  15. AppleCori

    AppleCori Well-Known Member

    I had no idea this was happening.

    It is very sad that the law allows for such predatory lending.

    I knew it happened with credit card debt, but people can eventually declare bankruptcy to get out of that debt in a worst case scenario, when there is no possibility that they can pay it back.

    I thought Social Security was safe from garnishments. I had no idea retirees were still paying on student loan debt.
  16. Copabanana

    Copabanana Well-Known Member

    Actually, the banks got more than 200 percent on their loans because they got the principal and they got 100 percent more from the penalties and then they got whatever interest the borrower had paid prior to the default. There was no benefit or incentive for the lender to work anything out. It was pure shaming and constant phone calls and letters arriving that were punitive and scary. I found myself just trying to avoid the whole thing, rather than logically trying to work something out.

    The thing about student loans is this: people want a good future. They attach themselves to a goal that they feel will bring it about, with an intensity that feels, do or die. It's not necessarily rational. And then when that future comes, they want other things, like a family, a child. Or a house.

    And they have saddled themselves with this debt. That is the situation millions and millions of people are in, and why I think some of the presidential candidates are making this problem central to their campaigns.

    I will say it again: Student loan debt is a form of a debtor's prison. Charles Dickens wrote about conditions such as this. It's still happening.
  17. AppleCori

    AppleCori Well-Known Member

    One other thing that is not being addressed is the cost of college, and their culpability in this student debt debacle. Tuition going up 10-12% every year, fees and other costs going up, exorbitant salaries, way too many employees doing things that we really don’t have to have on a campus, all contribute to this.

    Back when my mom went to college, her parents (a factory worker and a government worker who also ran a farm) were able to pay for the private college for her and her sister (two years apart in age) without taking out loans or taking from their retirement savings. College costs were in reach of the average middle-class family who didn’t live above their means, without anyone going into debt.

    Currently, that is very difficult for most middle class families, and either young adults are going into serious debt, or parents jeopardize their future by raiding their retirement savings.
  18. I hope I don't offend anyone hear but the professors keep getting higher pay and benefit packages. Health care paid in full.... The school teachers in our district get their health care paid in full for them and their spouse until they turn 65 and some are retiring at age 55! To me this is part of the problem. I don't agree with them getting their health care paid in full when they are no longer working... same with the state workers in the state I live in... People my age are retiring (51) and getting their health care paid for them and their spouse until age 65??? Federal government worker just retired at age 46 and will get his health care paid for him and his family until age 65?? 21 years of not working but health care paid???
    Sorry got off the topic here. Just upsetting to me.
  19. Nomad

    Nomad Well-Known Member

    All I can say is be careful. You are wise to inquire. I took out a loan and was told the interest was 2 percent. But the second I graduated it went up A LOT. I didn’t realize this and no one in my class did either. It wasn’t told to us by the rep. at the university and it was buried in the fine print. Paying the interest might make sense. I’m not sure. I would not rule out a part time job. At least try. Yes, it might be too hard. But, then again, it might be possible. Keep the hours minimum.
    I was surprised that I felt (and was) hoodwinked. I paid mine off as soon as possible using savings because the interest was mind boggling once I graduated. Again, be careful. I’m sorry I do t have more or better advice. But I can tell you from experience to be careful here.
  20. susiestar

    susiestar Roll With It

    My mother was a university professor. She, and her colleagues, went 10-20 years at a time without an increase in pay. VERY few college professors make the cushy life that everyone thinks they do. Those who earn a lot of money? They get it by writing textbooks, or creating computer programs, or consulting. They do NOT make it in university salaries. Even one of the TOP professors at her university in her field didn't get a raise for almost 20 years. He did get graduate assistants (grad students) to help with his research and teaching. He had to do one heck of a lot of fundraising for the college. He also wrote an excellent textbook on his field, and helped many businesses around the country with consulting. Consulting is where the $$$ is, not teaching. If he taught 2 or 3 classes, that was a HEAVY teaching load. Which meant less time for consulting. His wife was the top professor in her field in the country in MANY national rankings of schools and professors in her field. Her summer courses to help you get a professional certification were always PACKED with a long waiting list. I babysat for these 2 professor's kids for a summer. They did SOOOOOOOO much more than just teach. And did it without a raise for 20 years. That raise was 1-2% of their salary when it came.

    Administration is where the money goes, and stays. Administrators are paid handsomely, at least at the top levels. Other levels? Not so much. In the business school, professors who were department heads or heads of graduate programs, got very little, if ANY, extra pay. It was just one of those things you had to endure - being dept head was "honorary" but without an honorarium (aka pay for your work). Another place all that money goes is the big, fancy sports facilities. Not being a sportsball fan, I think that is crazy. But I am not in the majority, so I guess others understand why it is done.

    Student loans are an absolute blight on the community as a whole. It is just disgraceful how many administrators and banks use these loans as a cash cow they can milk until a student dies. And they often try to convince the surviving family to pay for the loans after the debt. One payment means that you owe the whole shebang. Of course that should not be legal, but they do it.

    I was blessed enough to have grandparents who spoke strongly with my parents about their wish to fund my education as long as I wanted to be in school. I had zero debt. We had no debt from Hubby's grad school as my parents were willing to pay for 1 graduate degree between us. We got ZERO benefits from having my mother teach at the school we attended. NO professors got even a discount on tuition until the last academic year. It does NOT cover the horrendous amount of fees (more than tuition by a large amount), just tuition. Everyone in our state was upset that people were getting "a free education" because their parents got jobs at the university. Sadly, they have to pay income tax on that tuition break just as if they were handed cold, hard, cash. They have to pay those fees every semester. None of this covers the student health center. Or medical insurance.

    It is all a big business, not a non-profit. And this is just wrong. Especially what the banks are doing with loans.