College seniors who graduated last year owed an average of $24,000 in student loans. That figure, as reported by CNNMoney.com, comes from The Project on Student Debt, which analyzed student loan debt at more than 1,000 public and private four-year schools.
Using some common assumptions, paying off $24,000 in student loan debt over 10 years would require a monthly payment of about $275. By the time the loan is paid off, interest charges will have tacked on another $9,000.
For parents of young kids, hopefully the prospect of having your kids start their working lives deeply in debt is a motivator to start saving for their college costs and to teach them to set aside a portion of their allowances or earnings for college. Need more motivation to save? Consider this: because of their heavy debt loads and the tough job market, a whopping 85 percent of last spring’s graduating seniors planned to move back home with their parents.
In a related note, Mainstreet.com recently ran an especially helpful article on helping your child qualify for as much college financial aid as possible.
If you have kids, are you planning to help them pay for college? If so, what’s your plan?