The College Debt Trap

You can’t expect 18-year-olds to understand what they’re getting into by taking out loans.

When Jane Bennett Clark's story Digging Out of Student Debt appeared on Yahoo Finance, it generated an astounding 4,600 comments. Jane wrote the story in response to the dozens of questions she fields from readers, such as the one from a recent college grad who had amassed $140,000 in loans while majoring in psychology and history at New York University. "Where were her parents?" one of my colleagues asked indignantly.

Unfortunately, there's no magic wand that will make those loans disappear. But one simple solution is not to take on so much debt in the first place. And that's where parents come in. You can't expect 18-year-olds to understand what they're getting into by taking out loans. They need help from Mom and Dad to choose a college (and maybe even a major) that makes sense economically. When one of my young co-workers was offered a scholarship to grad school, her mother advised her to take the money even though the school wasn't her first choice. She's glad she did.

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Janet Bodnar

Janet Bodnar is editor-at-large of Kiplinger's Personal Finance, a position she assumed after retiring as editor of the magazine after eight years at the helm. She is a nationally recognized expert on the subjects of women and money, children's and family finances, and financial literacy. She is the author of two books, Money Smart Women and Raising Money Smart Kids. As editor-at-large, she writes two popular columns for Kiplinger, "Money Smart Women" and "Living in Retirement." Bodnar is a graduate of St. Bonaventure University and is a member of its Board of Trustees. She received her master's degree from Columbia University, where she was also a Knight-Bagehot Fellow in Business and Economics Journalism.