News: Family Income and College, An Interactive Chart from NY Times.


This is a fun exercise that asks you to guess “how likely is it that children who grow up in very poor families go to college? How about children who grow up in very rich families?” Draw your guess on this interactive chart.

My result was:

  • You drew a more accurate picture of reality than about 56 percent of people who have tried so far.

How did you do? Did you find the results surprising or what you expected?


Punch Students In The Face?

Punch Debt In the Face had an interesting post about student loan forgiveness. There seems to be three main camps on this issue.

  1. Graduated without Debt = You do not support loan forgiveness.
  2. Graduated with debt within the last 7-10 years =  You probably support student loan forgiveness.  Due to increasing tuition, this group, on average, graduated with higher student loan amounts than in the past.
  3. Graduated with debt and paid it off =  You are totally against loan forgiveness.  After all, if you scrimped and sacrificed to pay off your debt, it’s not fair that other people get it written off.

I’m one of those people who graduated without debt.  Much of it had to do with hard work but A LOT had to do with luck and circumstances, too.

Part of me has a hard time supporting any sort of loan forgiveness program. It just isn’t fair to those who worked hard to pay off their debt.

Another part of me feels that predatory lending practices and skyrocketing tuition are also to blame for the huge student loan crisis.  For this reason, I’m glad that recent reforms are addressing those issues. Under the current policy, federal student loan borrowers do have a number of income-driven repayment options available. Of course there are eligibility requirements such as income, length of payment and type of job.

gradsSome opponents argue that loan forgiveness programs make it too easy for people to pay back very little of their loan.  I have mixed feelings on this one.  I feel empathy for people who are burdened by loans and don’t have a lucrative career to show for it.   I also believe that there is an unfair loss of opportunity for many lower-income students who cannot afford graduate-level education due to bachelor degree debts.  In short, I feel it is important to have loan forgiveness options. However, I would more comfortable if loan forgiveness was based on paying back a certain percentage of the loan (at debt2least 55%) instead of the number of payments unless there are special circumstances like very low income, disability or select occupation (such as teachers, social workers, and others in low-paying fields that are valuable to society).

Some people also want financial education to be required for students and parents before they sign for loans.  I agree that lack of education about the terms of loans is a huge problem and loan-speak should also be simplified.  I am not sure that financial education would be enough to stop bad decisions but if this knowledge could make more students take smaller loans, that would still be worth it.

There should also be equal focus, if not more, on the reasons for inflation-busting tuition increases.  I don’t know if this is something that the federal government alone can solve this.

Another issue that troubles me is the mixed messages we send to young people.  They are encouraged to study a variety of subjects up until high school.  Then when it’s time to go to college, it suddenly becomes all about making money (and it shouldn’t be).  We all know that philosophy degrees, as an example, do not lead to a lucrative career.  Why offer majors in philosophy, literature or the arts if the main purpose of college is to get good jobs?  I think colleges should be viewed as more than a pathway to a career.  It’s also about teaching critical learning skills which are so important in creating an educated society.

As I said, I did not graduate with debt so I’m no means an expert in this issue. It would be interesting to hear opinions from both sides.

News: Government Grants For Middle Class Students (California)

A while ago, I highlighted home-buying programs that are open to middle-class households. Another little-known secret is that the state of California also offers grants to middle-class households making up to $150,000 a year.   This is conveniently known as the California Middle Class scholarship.

According to a 2014 Los Angeles Times article:

“University of California and California State University students from families with annual incomes of $80,000 to $150,000 are eligible, and they initially were required to file federal financial aid application forms by early March. Students could receive as much as $1,710 this school year at UC and $768 at Cal State.”

It may be too late to meet the current deadline, but I would check out their website or call them at 1-888-224-7268 for information. At the very least, bookmark this for the next round!

This is one in a sporadic series of tips/ideas to help you stay middle-class (HTSMC).  Whether you consider yourself on the lower- or higher-end of the spectrum, you can probably find some useful tips to help you stay there and find save more for retirement even as wages stay stagnant.