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Who Should Take Out a Student Loan?

Student loans have become a normal part of many young people’s lives. But who should take on that debt? You as the parent or your student?

The average 2016 college graduate carries more than $37,000 in debt! $37,000!

This can be a massive burden for young people trying to get started in adulthood or on their own career path. It prompts many parents to take out student loans for their children. But is this the right decision?

Honestly, it is best that neither the student nor the parent borrows for education, but if it’s absolutely necessary and if you can keep them to a minimum, federal and private student loans can be helpful. Research them well and don’t sign any contracts without understanding all the small print.

Start by answering these questions:

How many semesters of loans will be needed? How many children need to be educated? Will borrowing affect your ability to tithe or to take care of future needs, like retirement?

Do you have an emergency fund, assets to cover the loan, life insurance, a retirement strategy in place and zero consumer debt?  If not, don’t borrow.

If you decide to have your child take out student loans in their name, discuss payoff plans and wise decision-making. Set them up for success in every way that you can. Be supportive, not crippling, when it comes to their financial future.

I recommended students never borrow more than they expect their annual starting salary out of college will be. Also, don’t borrow for anything other than school!  Books, food and groceries, and social activities don’t qualify as assets to borrow against.

And if you have the means and desire to pay for their college education, then do so with joy!  It’s reasonable to expect your student to carry some responsibility to appreciate your sacrifice in their commitment to study.

Remember, “The rich rules over the poor, and the borrower is the slave of the lender.”  Even when borrowing for education!

If you need more help or direction, call the Crown Helpline at 800-722-1976 or go online to