Though most aren’t even old enough to vote, prospective college students are learning a harsh political lesson. Thanks to a plethora of states struggling with mounting budget deficits, many public colleges and universities are boosting tuition rates. Luckily, Junior and little Sally will have the option to take out a student loan to cover those rising costs. Let’s examine why that’s not such a terrible situation for your children.
Rather than filling out numerous credit card applications just for the sake of getting a free t-shirt, which will likely ruin their credit, your children will begin building the foundation for solid credit. They’ll gain the ability to manage their expenses, be aware of what things cost, and learn to pay off loans. Learning these lessons through a low cost loan will prove invaluable to your children as they progress through life and take on additional financial responsibility.
A huge benefit of student loans is the associated terms. Borrowers do not need to start paying off the loan until they complete school and get their first job. Additionally, the rates for student loans are typically much lower than other types of loans.
While your children won’t want to hear about it, taking out a student loan to pay for school will help them build character. Their college experience will be much more rewarding if they are responsible for paying their own way, as opposed to having it handed it to them courtesy of the bank of mom and dad. Your children will be more inclined to work harder and get better grades if they know they’re on the hook for the bill.
Other than the obvious advantage of being able to attend college without having the cash up front, these additional benefits should eliminate any hesitancy regarding obtaining a student loan.