Okay, Mr. Smartytrousers, is that 10% of the original article, or my summary?
Part 5: Problematic parental student loans.
“[B]orrowers of student loans age 60 and older [are] the fastest-growing age group for college debt,” but they do not demand attention like their children because they are ashamed. They did well enough until they took on debt for their children.
“At one point, she said, the Internal Revenue Service seized a $2.43 tax refund.”
“In one extreme case, student debt, and the constant creditor calls, were mentioned in a suicide note by the stepfather of a young law school graduate. The guilt has been crushing for the graduate.”
That seems to be the story of a then-recent law school graduate, who owed $200,000 in student loans, and his mother co-signed for $100,000 more. Right now he is paying $1,200 a month, but that does not even cover all of the interest. He has not found a good job in his field.
Some Parents, Shouldering Student Loans, Fall on Tough Times - NYTimes.com
Part 6: Borrowing to build attractions on college campuses.
“A decade-long spending binge to build academic buildings, dormitories and recreational facilities — some of them inordinately lavish to attract students — has left colleges and universities saddled with large amounts of debt. Oftentimes, students are stuck picking up the bill.”
They list a great many ways that universities are spending money to make school more attractive, but very little of it goes towards actual education. “While Harvard is the wealthiest university in the country, it also has $6 billion in debt, the most of any private college, the data compiled by Moody’s shows.” “Harvard borrowed $1.5 billion to pay its bills rather than selling off assets at a sharp discount. Its interest expense more than doubled from fiscal 2008 to fiscal 2011, to nearly $300 million.
“Ohio University, […] has proposed spending $2.6 billion on construction projects in the next 20 years, half of it paid for by debt”
“Outstanding debt at the 224 public universities rated by Moody’s [increased 130%] in inflation-adjusted dollars in [twelve years]. At the 281 private universities rated by Moody’s, debt increased [107.5%], in that period.”
$63 million in debt has left Mount St. Mary’s University, a small Roman Catholic college in Maryland, with thin financial resources and junk-rated credit, according to a Moody’s rating in March. `We borrowed a lot of money, but we had no choice,” said Thomas H. Powell, the university’s president, […] `I wasn’t going to watch the buildings fall down.’”
“Daniel M. Fogel, who resigned last year as president of the University of Vermont, said that given the lack of state support, many public colleges and universities had to borrow money just to remain adequate. He said that when he arrived at the university in 2002, some of the laboratories were inferior to those at many high schools.”
“David K. Creamer, vice president for finance and business services at Miami University, said the importance of college rankings had pressured administrators to spend more and more. In some rankings, the effect of spending is direct because institutions with `the best dorms’ or `the best athletic facilities’ are singled out. The effect on other rankings is indirect: better facilities attract better students, and that ultimately raises rankings, Mr. Creamer said `[If] you become more efficient, your ratings will […] probably go down.”
Your tuition should go down, though, while schools that improve their rankings probably need to charge more.
“At Ramapo, President Mercer said he planned to focus on marketing the college’s academic reputation, rather than its new buildings. Students, he said, seem less interested in `bells and whistles’ now that the costs of college — and the potential debt — have become painfully clear.”
Colleges? Debt Falls on Students After Construction Binges - NYTimes.com
Part 7: Working your way through college
“As of 2010, some 17 percent of full-time undergraduates of traditional age worked 20 to 34 hours a week, according to the National Center for Education Statistics. About 6 percent worked 35 hours or more.”
“My folks tried everything to keep me from joining the Army,” [Steve Boedefeld] says. “They told me that I could go to school wherever I wanted and that they would pay for it. But I was pretty much dead-set that I could do it on my own. Their parents didn’t float their bill, so why should I be different?
“[He] enlisted in 2006 and finished his service in 2010, after three tours of duty in Iraq and one in Afghanistan, each lasting three to six months. The discipline that allowed him to endure Ranger training and survive combat has carried over to his financial life. As a soldier in a war zone away from his wife, Jennifer, he earned as much as $5,000 a month, much of it tax-free thanks to longstanding rules governing combat pay. They put away $10,000 to $15,000 annually. `One of my friends calls me an economy killer,’ he said.
“The Boedefelds arrived in Boone with enough money for a down payment on a fixer-upper. They moved there because Appalachian State offered a degree in renewable energy that interested Mr. Boedefeld, now 25. He joined the North Carolina National Guard to get in-state tuition rates, and his service enables him to buy reasonably priced health insurance for his wife and two sons.
With his National Guard service, his $2,000 a month or so in G.I. Bill benefits and the $10 an hour he makes working 15 to 20 hours a week for an electrician, the family is debt-free, save for their mortgage.”
“We definitely live on what we can grow in the garden and what I can hunt for.”
“Then there are the comments about [another student’s] banged-up Toyota with nearly 134,000 miles on it.”
I bought both of my current cars with more miles than that!
College Costs, Battled a Paycheck at a Time - The New York Times