How to pay for college now

[corn18]

Done a lot of good work in the past year with everyone's help. Just have a mortgage left. Expenses cut to well below income. Saving a lot more. Managed to fully fund 401k and 2 IRA's. Funded an EF. Started a car and vacation fund. And started putting money into a college fund for my youngest daughter. All is progressing well.

But now my oldest daughter (19) who moved out on her own this past March on less than good terms has asked to start college. She is working and making it on her own (barely) but she has not asked me for a dime. This is remarkable considering where she was 9 months ago.

I only have $6k in the college fund and have a good plan to fully fund my youngest' college plans starting in 2016. But I never had anything set aside for the oldest daughter and never planned to. The oldest was never going to college on my nickel the way she was going. But she has demonstrated she can make good decisions and also discovered that it's nigh on impossible to live off of $12 / hour. And that some higher education can help her make more money.

So she wants to start an online program @ ITT Tech for an Associates Degree in Business Admin of some sort. Ain't cheap and I don't have enough put away to cover it. So I am thinking of getting student loans ($5,500 federal and the rest private) to cover her school. It ain't cheap at $21,000 / year. And she won't be full time so it might only be $5,500 / year. Just not sure what the best way to make sure she has skin in this game. I would love to get the loans in just her name and then if she keeps her grades up, I will pay them for her. If she fails, she gets sacked with the financial burden of the loans.

Any advice is welcome. Always something. I am surprised and happy but cautious.

Tom

[creditcardfree]

My husband went to ITT. It WAS expensive. Although, I think it was right for him and did lead to a good job following completion. I would go into the financial aid office (maybe with her) to understand your choices. I think you are right to try to put the loans on her, she should then be more motivated. It could really backfire and then you would be on the hook for the loans. I might not even tell her that you might pay anything. I would just help her make the best financial decision for her. One of those things to consider is if there are other programs that would be cheaper!

[disneysteve]

She is working and making it on her own (barely)

she has demonstrated she can make good decisions and also discovered that it's nigh on impossible to live off of $12 / hour. And that some higher education can help her make more money.

So she wants to start an online program @ ITT Tech for an Associates Degree in Business Admin of some sort.

It ain't cheap at $21,000 / year. And she won't be full time so it might only be $5,500 / year.

Kudos to her for what sounds like her growing up quite a bit over the past 6 months and starting to thnk like an adult, including starting to recognize the value of education. That said, however, I think what she may not yet appreciate is the value of the dollar. ITT may have a good program but it's only good if you can afford it and it sounds like she can't (and you can't).

My recomendation is to have a straight talk with her about options. Typically, I'm not the one to come on here recommending community college but this is one of the situations where I think that is absolutely the way to go, at least at first. Rather than spending $21,000/year for her to test out college and see if it's a good fit for her, far better to spend a fraction of that at your local community college. Our local one charges $107/credit which works out to about $2,600/year for a full course load of 12 credits each semester. That's a big difference from $21,000.

I do not think financing everything with loans is a responsible way to go for either of you. If college doesn't work out for her, the loans could bury her if she's barely making ends meet now. And even if college does work out and she gets a degree and a better job, she'll be saddled with loan payments for years so that the higher salary will largely be going to debt repayment and won't actually buy her a more comfortable life for quite a while.

Just some general comments: Avoid private loans at all costs. The terms can be horrendous and the interest rates can climb incredibly over time. Also keep in mind that in almost all cases, student loans are not bankruptable so if she does run into trouble, these loans won't ever go away.

[Weird Tolkienish Figure]

Done a lot of good work in the past year with everyone's help. Just have a mortgage left. Expenses cut to well below income. Saving a lot more. Managed to fully fund 401k and 2 IRA's. Funded an EF. Started a car and vacation fund. And started putting money into a college fund for my youngest daughter. All is progressing well.

But now my oldest daughter (19) who moved out on her own this past March on less than good terms has asked to start college. She is working and making it on her own (barely) but she has not asked me for a dime. This is remarkable considering where she was 9 months ago.

I only have $6k in the college fund and have a good plan to fully fund my youngest' college plans starting in 2016. But I never had anything set aside for the oldest daughter and never planned to. The oldest was never going to college on my nickel the way she was going. But she has demonstrated she can make good decisions and also discovered that it's nigh on impossible to live off of $12 / hour. And that some higher education can help her make more money.

So she wants to start an online program @ ITT Tech for an Associates Degree in Business Admin of some sort. Ain't cheap and I don't have enough put away to cover it. So I am thinking of getting student loans ($5,500 federal and the rest private) to cover her school. It ain't cheap at $21,000 / year. And she won't be full time so it might only be $5,500 / year. Just not sure what the best way to make sure she has skin in this game. I would love to get the loans in just her name and then if she keeps her grades up, I will pay them for her. If she fails, she gets sacked with the financial burden of the loans.

Any advice is welcome. Always something. I am surprised and happy but cautious.

Tom

Go to CC's for as long as possible. With the cost of college these days loans are inevitable. Make sure they are federal, not private.

[disneysteve]

With the cost of college these days loans are inevitable.

I have to disagree with this statement. Loans are not inevitable. A good student can get academic scholarships. Combine that with family savings and work and it is certainly possible to get through college debt-free especially if you choose the school wisely.

[bigdaddybus]

Tom, I just wanted to say that "I was your kid at one time" and my parents thought I was on the road to nowhere, and now my wife and I are in the top 5% of earners in the US. It just takes some of us longer than others to grow up and sometimes help. (my help was from the military)

Congrats on your household budgeting sucess as well. My wife and I made similar progress 2 years ago and the reduction in money induced stress was tremendous.

As far as your daughter is concerned I think you are on the right track with getting loans in her name and providing assistance at the level you are comfortable with. perhaps you could do something like for every sucessful sememster she completes (with loans) you will pay for the next semester. This splits the cost between you two and should keep her engaged.

I wish you both the best, in growing her career and mending your relationship

[corn18]

Thanks to all. I talked to my daughter and she gets it. Risking $24k to see if college suits her is not a wise investment. She thinks she found a night program at a local community college that costs $2,600 / year. She's checking to see if they have some course she can take and figure out if college is for her. I can afford $2,600. Life is good.

Tom

[disneysteve]

Thanks to all. I talked to my daughter and she gets it. Risking $24k to see if college suits her is not a wise investment. She thinks she found a night program at a local community college that costs $2,600 / year. She's checking to see if they have some course she can take and figure out if college is for her. I can afford $2,600. Life is good.

Tom

Very good decision. If she is well-suited to college, she can take care of some core curriculum requirements at the community college and later think about transferring to a full-service school to complete her degree.

Around here, our local community college is now partnered with one of the state colleges so that you can actually do all of yur coursework at community but get a degree from the state school. That's an even better deal. I think the college establishment is finally starting to realize that they have priced themselves out of the realm of possibility for a growing number of potential students so they are beginning to come up with creative ways to make college affordable.

[LivingAlmostLarge]

impressive that you and your daughter went the cheaper route. Good luck to her!

[Eagle]

Done a lot of good work in the past year with everyone's help. Just have a mortgage left. Expenses cut to well below income. Saving a lot more. Managed to fully fund 401k and 2 IRA's. Funded an EF. Started a car and vacation fund. And started putting money into a college fund for my youngest daughter. All is progressing well.

But now my oldest daughter (19) who moved out on her own this past March on less than good terms has asked to start college. She is working and making it on her own (barely) but she has not asked me for a dime. This is remarkable considering where she was 9 months ago.

I only have $6k in the college fund and have a good plan to fully fund my youngest' college plans starting in 2016. But I never had anything set aside for the oldest daughter and never planned to. The oldest was never going to college on my nickel the way she was going. But she has demonstrated she can make good decisions and also discovered that it's nigh on impossible to live off of $12 / hour. And that some higher education can help her make more money.

So she wants to start an online program @ ITT Tech for an Associates Degree in Business Admin of some sort. Ain't cheap and I don't have enough put away to cover it. So I am thinking of getting student loans ($5,500 federal and the rest private) to cover her school. It ain't cheap at $21,000 / year. And she won't be full time so it might only be $5,500 / year. Just not sure what the best way to make sure she has skin in this game. I would love to get the loans in just her name and then if she keeps her grades up, I will pay them for her. If she fails, she gets sacked with the financial burden of the loans.

Any advice is welcome. Always something. I am surprised and happy but cautious.

Tom

I read today where Starbucks is to cover the cost of an online 4 year degree through Arizona State University (49 degree programs available) for employees who work 20 hours or more a week. http://finance.yahoo.com/news/starbu...120804894.html

[corn18]

I notice a lot of new members come on and post many replies that add no value or make no sense whatsoever. Seems to be a regular theme on SA more than any other fora I am on. Just an observation.

[JoeP]

I notice a lot of new members come on and post many replies that add no value or make no sense whatsoever. Seems to be a regular theme on SA more than any other fora I am on. Just an observation.

Exactly why I proposed a vetting process before new members can post to the general forums; that suggestion went nowhere.

I'm glad to hear that your daughter is testing the waters with a less expensive option, and wish her and you the best.

[TheKayla]

I would not personally recommend ITT -- its very expensive for a moderate-reputation school. I would recommend she go to community college first. Then, shop around for programs that balance quality education and price.

1 - see if she can get a 2 year degree for a field she wants to get in
2 - if she needs a 4 year degree, have her go to community college first to get her gen ed's in more cheaply. There's no point in paying 21k a year for a basic 'review of high school' as I consider it

By going to a cheaper school first, even for just gen-eds, between the both of you, you should be able to avoid student loans all together. Avoid them as long as possible, it's dangerous to think taking out student loans is necessary. There are a ton of other options.

In fact my roommate is working in her chosen field without a full bachelor's degree. She started working at the bottom as an assistant, went to school at nights, paid as she went with very, very little debt. When she got her 2 year, she was able to move up in her career. Now she's been making money while working/gaining experience in her field the whole time. Doing something like this could also give your daughter of how far she could get without paying for a degree.

[chessie21]

loans

Don't get loans you have to pay back , get loans that are grants for you to keep. sign up for scholarships also.