Parents Scale Back on Retirement and College Savings

RETIREMENT AND COLLEGE EDUCATION

I AGREE THAT IT IS A HARD SITUATION TO BE IN BECAUSE NOW I HAVE TO WORRY EVEN MORE ABOUT RETIREMENT BECAUSE I AM DIVORCED. I HAVE A ONE YEAR OLD GRANDSON AND I CAN NOT STRESS ENOUGH THAT MY SON WHOSE 30 YEARS OLD PUT ASIDE FOR HIS RETIREMENT AND MY GRANDSON'S COLLEGE EDUCATION BECAUSE YOU DEFINITELY NEED MORE THAN AN HIGH SCHOOL DIPLOMA. HERE I AM IN MY 50'S TRYING TO GO TO SCHOOL MYSELF AND SAVE FOR RETIREMENT AND IT IS HARD BECAUSE NOW I AM GOING TO HAVE TO GET LOANS. IT IS NEVER TOO YOUNG TO PLAN FOR RETIREMENT ESPECIALLY WITH SOCIAL SECURITY THE WAY IT IS.

KEYBRA RIDDICK of VA @ Oct 19, 2008 15:17:08 PM

When Lenders and Market Makers Get Together, Prices Rise

Just like lenders and real estate agents worked together to push up home prices so that the agents got higher commissions and the bank got more interest on the new lifetime debtor, so colleges and student lenders have worked together to make tuition rise because banks win with deeper and heavier college debt and the rich interest students pay for a lifetime and universities win because they can raise tuition as high as they like.

The problem in America is debt. Sellers of everything from homes to bachelor's degrees to cars and LCD TVs use credit as a means to get people to buy things they cannot afford. I knew a lady who had a vocational school for entry level hotel front counter workers and assistant managers and what not and she got certified for federally backed student loans (even private loans have federal backing against default) and she would pull homeless people off the street and charge them $15,000 tuition to put them through a hotel management/worker program for 12 months. She'd pay the "professor" $40,000 a year and all that they needed besides that was chairs. A room full of 25 students returned $375,000 less $40,000 for the teacher and a marginal sum for the room. You could pick up anyone no matter how desperate because banks will give student loans to quite a wide range of people since the federal government pays them back if the student defaults. But the student is hosed too because he can't bankruptcy the debt and the penalties and interest follow him for LIFE and the US government will garnish SSI, SSA, tax refunds, wages, anything they can get their hands on for the rest of your life.

Housing worked much the same way and still does with the Feds headed by the same hacks from Goldman Sachs (Paulson) and Carlyle Group guy who will head Fannie now (Carlyle is the one where Bush Sr. got to make big money from KBR making soup and putting port-a-potties in Iraq for $10 billion). The new Treasury move today will put an extra $200 billion into Fannie and Freddie backed by the federal government to encourage lending to people that normal banks worried about being repaid wouldn't lend to. They wouldn't lend because they'd be worried about whether the person could repay. Take away that worry and even if people shouldn't be buying houses or overpaying for them at least because prices are dropping and inventory is at records, there will be foolish buyers who will do it if someone will loan them the money to. If the federal government backs the debt, then buyers (and students are buyers of education) will overpay - that is the ones who are foolish to overpay will be able to borrow the money to do so when a normal market wouldn't allow it.

Sean of @ Sep 07, 2008 20:15:50 PM

Hey, you know..

..it sucks really bad to be poor and educated. Then to know that your parents are poor because of your education has to sting as well. Then to spend 12 years paying back any loans you made during the whole fiasco. "But I can do calculus!" Can you find a good job? "Ummm...education is..good?" Wrong response. You know, I went to college with an Omish guy who was set for $50,000 in debt that he was going to have for 4 years of college with a bachelors to show at the end for all of the trouble. I think colleges and their recruiters should make better finance(lower cost and more payment options) for students and parents just as important of a priority as profit. Jacob wouldn't have had to hock his plow if things were different. That situation helped inspire me to transfer to a State school.

of NC @ Sep 04, 2008 22:56:52 PM

College administrators have failed us!

The fact that parents are forced to make these types of decisions shows how much the cost of higher education has spiraled out of control. Colleges teach today basically the same things in the same way as was done in 1960 but an inflation adjusted cost comparison between 1960 and today shows the average tuition has risen 3 to 4 times faster than inflation. In-state tuition at most state universities now costs almost the same as inflation adjusted tuition to Harvard was in 1960. Alumni and state governments must demand a return to an economical college education. Details of the cost comparison between 1960 and today can be found at www.clearpictureonline.com/1960-Food-College-Income.html.

Roger Ansted of TX @ Sep 04, 2008 21:06:23 PM

Yes,I will scale back on retirement and college saving.

cluyee of MS @ Sep 04, 2008 02:47:52 AM