Student loan debt

Last week Washington Post columnist Danielle Douglas-Gabriel published an article detailing the Biden administration's efforts to crack down on student loan servicers for failing to send timely billing statements, inaccurately reporting borrowers to credit agencies, and sending collection agents to homes of borrowers who are awaiting processing on applications to income-based repayment plans. Secretary of Education Miguel Cardona said in a statement Friday, “When unacceptable errors are uncovered, servicers should expect to be held accountable and borrowers should count on this administration to hold them harmless.”

I am sympathetic to the plight of student loan borrowers and have my own tales of woe to tell. But that's a story for another day.

When I advise clients on choosing colleges where they will apply, and when I am offering financial strategy to families more broadly, I always encourage students to minimize their student loan debt, especially for undergraduate education. If it's possible to take out no student loan debt at all, so much the better.

There are several ways to do this, and my advice varies according to each student's unique goals and each family's unique financial situation. For one student, the best option might be to attend a major state university to get an affordable, foundational, in-state undergraduate education and then take on some limited student loan debt to pay for a graduate degree. For another student—for example, an elite student-athlete from a middle-income family—the best and most affordable option might be an elite private college that will offer a generous need-based financial aid package covering not only the student's tuition, but also additional expenses such as room, board, and books.

Merit-based scholarships, participation in honors programs, private scholarships and grants, and paid internships are all ways to help offset the cost of higher education. Depending on the student's career goals, not attending college at all and instead enrolling in a trade school or certificate program might be the best course of action.

I'm here to help! Use the contact form on my website to schedule your free consultation today!