I’m so in debt my teenage son is afraid of student loans


Dear Penny,

I am in a horrible spiral. We first got into debt when my husband and I agreed I should stay home to take care of our first baby. Without my income – and with our reckless spending habits – we have accumulated massive credit card debt.

In five years, we had three children. My husband had student debt and we took out payday loans to cover our living expenses. With child care costs so high, it didn’t make sense for me to work.

Eventually I realized I had to do something to help with this burden, so I got a Pell Grant to go to college. Stupidly, I took out the maximum amount of student loans to help with daily living expenses.

I thought I would earn enough with my degree to pay it all back and get us out of the very deep hole we were in. I was wrong. I defaulted on my student loans and couldn’t pay any debt. We struggle to pay payday loans every month, our rent is always late, our kids are going without everything they need – even lunch money – and we struggle to pay for gasoline. and the grocery store.

On top of all that, my husband had a heart attack last year, so we ran into astronomical medical debt.

Our oldest son is graduating from high school this year and he’s so traumatized by the struggle he sees us going through that he almost didn’t apply to college. He’s a brilliant student, but he’s afraid of going into debt. He knows we can’t help him with the fees, and with our “middle class” income, he won’t be eligible for financial assistance.

My heart is broken because of it. I thought about quitting teaching to get the retirement savings I have accumulated. I don’t know what else to do to make a dent in this mess.

I don’t even know where to start. To help!


Dear J.,

Your debt has consumed you. You probably thought you hit your lowest financial point years ago when you were a new mom; then you probably thought you were at a low again when you defaulted on your student loans. And now here you are with the added burden of medical debt and your son’s misconceptions about how investing in college could derail his future.

There are a lot of things you can’t change right now. But one area where you can make a major change right away is the way you and your son discuss his options for higher education.

Your family’s income is not the only factor determining the financial assistance your son is entitled to. Your family size, for example, will also be taken into account. Applying for federal student aid is essential if your son is to continue his studies at university, as it is the first step in determining the type of grants, loans and work-study programs that will be available. available to help cover the costs.

Once he receives offers of financial aid, he can really assess the affordability of the school. He may have to start at community college or some other less expensive option, but he shouldn’t rely on college just because of your family’s financial hardship.

Then it’s time for you to get some help figuring out options for your own finances. Enlisting the help of an impartial third party can help you make sense of your situation instead of spinning your wheels and feeling hopeless. A debt counselor in your area can review your credit report and provide you with free educational resources that can help you. They can also help you sign up for a debt management plan that will make managing your debt easier.

In extreme cases, a debt counselor may recommend that you consider filing for bankruptcy, which may pay off some of your debt. There is a lot of shame in doing this, but it could be the lifeline you need to find stability for your family.

And that might be the hardest part of your next financial step: letting go of the shame. More people than you can imagine have struggled for financial stability, let alone success. I’m not going to be flippant and say you’re in good company. But at least you have company.

You may be surprised at how understanding your peers are when you seek help and begin to get yourself out of debt.

Worried that your financial stress is having an impact on your family? Write to dear Penny at https://www.thepennyhoarder.com/dear-penny/

Lisa Rowan is a personal finance expert and senior writer at Penny Hoarder, and the voice behind Dear Penny. For more practical money advice, visit www.thepennyhoarder.com.


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