The Dilemma

I’ve stated before how I despise student loan debt and how I believe that it could be what ignites the next financial crisis. That’s not completely the point today, but sort of. 

We do need to remember that according to NAR, the millennial generation is our number one home buying segment (close to 35%). And we need to remember that the main factor slowing down our number one home buying segment is student loan debt (~55% of those millennials who said they delayed their purchase because of debts cited student loan debt as the number one obstacle). So I still feel very strongly about the importance of helping young adults avoid student loan debt or at least minimize it. But at the same time, I understand that to have access to an upwardly mobile career, most need an education beyond high school as well.
 

I had a heartbreaking conversation with a friend of mine this week, whose excitement the week before from learning that her daughter had been accepted to the college of her choice, was now deflated with the knowledge that there would be no financial assistance provided for the cost at that school. She and her husband have no college savings and no option other than borrowing the money if their daughter is going to the school of choice. I encouraged her to do everything she could to keep from having her daughter go down the road most popularly traveled and take on debt to pay for the education. I told her that if she felt she and her husband had an obligation to pay for her daughter’s education, then the decision would be up to them as it related to borrowing the money.  I still don’t like that idea, but told her that in my opinion, it would be better for them to borrow the money than putting that debt burden on her daughter – particularly if they felt an obligation to pay for her education.
 

Unfortunately, this scenario plays out a lot more regularly than it should.  But does it have to come down to a choice of either skipping/delaying college or moving forward by adding debt?  Shouldn’t there be a better way?  I have some thoughts on that and will share next time.  Have a great week!!