Tommy: There's no such thing as a free lunch

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We’ve come a long way in a short period of time. It’s interesting to watch television shows or movies that were made in 2010 and realize that technology is advancing at an exponential rate. There is, however, one thing that has not changed throughout the history of mankind. There wasn’t then, ain’t now, and never will be any such thing as a free lunch.

It was interesting hour on Wednesday as we discussed the student loan situation that we’re facing. Students have rung up an astounding one and a half TRILLION dollars in student debt. Some are saying the only way a Democratic candidate will survive the primary process is if they address and offer some relief to those who aren’t happy about the monthly payments. The plan is to offer some type of student debt relief that Republicans won’t, thereby motivating the base to turn out and vote for the Democratic nominee. What’s getting lost here is there ain’t no such thing as a free lunch.

Part of being a parent is to get the kids ready to leave the nest. Any mom or dad should want their sons or daughters to survive and thrive in the real world. In order for that to happen, they need to be given the information they need. Somehow that message isn’t being conveyed to the offspring.

It is the responsibility of any parent to explain basic finances to their child. I think that education can begin as early as 6 or 7 years old. That way they understand that you have to pay back what you borrow; and before you borrow it, make sure you really want what it is you’re borrowing the money for. That’s how it works if you want to get an advance on your allowance, charge something on a credit card, buy a car, purchase a home or finance your way through college.

When it came to my kid twas in 8th grade I disclosed there was no Tucker trust fund. I explained that if she wanted the private college experience she would have to pay her way through with scholarships or borrow the money and pay it back after she graduated. An in-state public institution, on the other hand, would offer TOPS financial aid; and, as a result, the funds on hand would go further.  Graduation would include a diploma but no debt. She opted for the latter.

That may be because I had introduced her to an amortization table. I think more parents should do this. If you don’t know what that is, it’s a set of tables that shows how much a monthly note will be at different interest rates depending on how long you want to take to pay it off. I think that should be the first lesson of any college education. If you borrow x amount and the interest rate is y, it is going to take you z to pay it off. I don’t think that lesson is being taught. As a result college graduates, though educated, are surprised at how much their monthly payments turn out to be and for how long they have to make them.

Somebody should have told them. There ain’t no such thing as a free lunch.