Dave Ramsey is a US based finance guru. He has a useful article on how to help your kids not to get in deeper than necessary with student loan debt. Student loans are funded and dealt with differently in New Zealand, compared to the US, but many of the points made are worth considering:
- Talk to your kids about money, including student loan debt. Don’t let them go in blind.
- Apply for as many scholarships as possible and consider working so that the amount of debt taken out can be minimised.
- If possible, live with family while you study, to keep costs down. You might be itching to start your adult life and have more freedom, but there can be a large financial cost. If that cost is funded through debt, you might still be paying it off in 20 years. Ask yourself: is the extra cost/debt really worth it?
- Don’t take on extra debt in the form of credit cards.
- Work hard so that you graduate as soon as possible.