The Debt Trap of College Invest , HSA’s, and Student loans
It took me 3 different changes each for investing for our grandchildren’ future education prospects as well as our HSA (Health Saving Accounts). These saving vehicles were supposedly set up to help with future education and health expense funding with the idea that they would grow and also offer a tax advantage to the investor.—WRONG !
Funding out 6 grandchildren starting with a $1,000 birth investment and then adding smaller amounts at birthdays’ and holidays seemed like a no brainer! WRONG!!
Over the past 10 years we have pretty much ‘treaded’ water and, until I moved the fund, lost money to fees despite the interest which we all know is painfully low. Now, because our combined income is more than $150,000, we receive no tax benefit for the contributions to our grandchildren’s future education or our own health care future not to mention little or no income for the funds.
We helped our youngest, twin sons, 31, with some of their education expenses as well as their grandparents, who had invested money for their futures. At their completion of grad school and professional school respectively, they each moved into their working lives, fortunately with employment, but with $100.000.00.00 each in school loans to pay off. They are working at paying them down… OUCH! 6 percent! They may be able to renegotiate to 4 percent.
This is not a pretty picture for college grads who so often do not find gainful employment or for prospective young people seeking to live out their dreams
All 5 of our grown children (39-31 yrs old) were able to complete the education of their dreams in a timely manner and are enjoying paying their own bills and building their own families. This seems a much steeper uphill with fewer ways to plan and save for the future. Our single 31 yr old sons have shared that in their circle of peers that the future does not look very hopeful in terms of living as well as their parents or their own up-bringing. Debt and more debt and aging parents and growing families hang as a heavy cloud over their future..
There do not seem to be any magic fixes and just because we have learned to dig a “hole of debt’ and keep digging for what? A magic fix? Someone else to take care of. It seems to me that we are all in this together and our goal would be better served by asking what each of us can do, NOT what “magic government fix “ might enable us to NOT take responsibility.
When our kiddos were young we had guinea pigs along with a long zoo list of big and little dogs, cats, birds, fish and rodents that shared their growing up. It is the small rodents that come to mind recently. Running in their spinning wheel, the occupied adults beheaded the young guinea pigs who innocently lost their lives by wanting to join in the action. Are we all too ‘occupied’ with living out good lives to be aware that our spinning wheels are deadly to our children and grandchildren?