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Paying off your kid’s student loan

Posted July 31, 2022

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As a parent, you give up everything for your children. You sacrifice your time, energy, money, body, and priorities, all so that they can be happy, healthy, and prosperous. For eighteen years, you raise them under your roof, and finally, the time comes for them to spread their wings and fly— college.

Now, even though your child won’t be under your roof anymore, you still want to do everything you can to ensure they are set up for success and prepared for this next step in life. You buy everything they need and then some for their dorm. You weather the sweltering August heat of move-in day, and you purchase the most expensive meal plan to ensure they eat and remind them to call and to call often.

But one thing you may be tempted to do as your child leaves for college, but should think twice about, is to take out a loan for your child’s college tuition.

According to NerdWallet, the average student finishes college with nearly $30,000 in debt. In fact, 42.9 million people finish college with student loan debt; that’s one in every eight people in the United States (Source: NerdWallet).

In fact, over the last thirty years, tuition costs have risen from $4,160 to $10,740 at public four-year colleges and $19,360 to $38,070 at private nonprofit institutions (Source: Forbes). It’s no wonder that parents are looking for every opportunity to help their children when it comes to paying for college.

But here’s the thing— you can take out a loan for college, but no one will give you a loan for retirement.

We mean that while you may want to help your children pay for college, you must ensure you are taken care of first. While your child prepares for the next stage in life, you’re doing the same. The only thing is, your next stage, retirement, has even higher stakes.

Retirement gets closer every year, and you need to consider how your financial situation is looking for the golden years. Will you have your mortgage paid off? Are you prepared for medical bills as you get older? Have you accounted for the cost of living? Do you have aging parents you will need to take care of shortly?

Unfortunately, we can’t tell you exactly how much it will cost to retire, but we can work with you, review your unique situation and empower you to make the right decision for your family.

However, if you are fully meeting your retirement planning goals and have extra cash/income available, helping your kid with their student loans can be a great way to get them started on the right path. However, it should rarely come at the expense of your own goals and financial well being.

Everyone’s situation is different, and we are committed to working with our clients to understand all the facts, run the numbers, and help them make an informed decision about whether it is a wise financial decision to take out a loan to help pay for their children’s tuition.


Thayer Financial, L.L.C. (“Thayer Financial”) is a registered investment adviser offering advisory services in the States of North Carolina, Tennessee, Texas and in other jurisdictions where exempted. Registration does not imply a certain level of skill or training. This website’s presence on the Internet shall not be directly or indirectly interpreted as a solicitation of investment advisory services to persons of another jurisdiction unless otherwise permitted by statute. Follow-up or individualized responses to consumers in a particular state by Thayer Financial in the rendering of personalized investment advice for compensation shall not be made without our first complying with jurisdiction requirements or according to an applicable state exemption.

All written content on this site is for information purposes only. Opinions expressed herein are solely those of Thayer Financial, L.L.C., unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to other parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation.


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