When the scholarship and grant money that Danielle Newman received to attend the University of Pittsburgh did not cover the full price tag of attending, the 18-year-old freshman used a student loan to cover the difference. Facing higher costs as an out-of-state student, she already assumes she will need student loans for the remainder of her undergraduate education.
“I borrowed $5,500 this year. I plan to borrow $6,500 next year and $7,500 the year after that,” said the rehabilitation science major from Newark, Del. “I will finish my undergraduate degree in three years, partly because it is so expensive.”
Another hard reality Ms. Newman has embraced is that she will likely need to move back into her parents’ home after she graduates, so she can make payments on her student loans while she gets started in the real world.
“I definitely believe that I will live with my parents for some period of time before I get my own place after graduation,” she said. “I haven’t talked to my parents about it because it’s so far down the road. I’m an only child. I think they will be OK with it.”
Saddled with historic amounts of student loan debt, the boomerang kid phenomenon — defined by college graduates who move out to attend higher education, but end up landing back on their parents’ doorsteps — has become the new normal.
According to a Harris Poll done on behalf of the New York-based American Institute of CPAs, more than one third of college students who enrolled in the fall of 2015 plan to live at home following graduation due to student loan debt. They also thought they might have to take a job outside their field of study.
On average, college students with loans thought they would be able to pay off loans in nine years after graduation. Only 18 percent said it would take more than 10 years. A quarter didn’t know how long it would take; and 6 percent of those surveyed said they had never given it any thought.
Carrie Coghill, CEO of Coghill Investment Strategies, Downtown, said the potential downside of young adults moving back in with their parents after college is that they could get stuck in a stage of arrested development.
“The natural tendency as a parent is to want to take care of your child regardless of how old they are,” she said. “As a parent, you should not revert to taking care of them as a child, such as cooking their meals, doing their laundry and paying their bills. That phase of life when they return home should be different than it was before they left.
Source: Pittsburgh Post-Gazette | Tim Grant