7 of 13
Suze estimates that Cathy and Jamie will eventually need to take out $320,000 for both girls, but she runs the numbers based on paying for their eldest daughter, Alex, alone.

Together, the couple's monthly take-home income is about $6,500, and they have $6,300 in monthly expenses. So far, they've saved a total of $7,500 in college funds and have another $9,000 in an emergency fund.

Jamie says he intends to borrow the money through student loans and pay it back monthly over time. To borrow $160,000 for Alex, Suze says Jamie would likely get a PLUS loan through the government. At 8.25 percent over a 30-year term, Suze calculates a repayment of $1,275 each month. The interest they would pay over 30 years on that money is a whopping $300,000!

And that's only for one child. "So not only will Daddy and Mommy having to be paying every month on one child till they are 80, very shortly, they are going to be paying $2,500 to $2,600 a month for 30 years," Suze says. "They're bringing in as much as they have going out right now."

Keep Reading
PREVIOUS | NEXT
FROM: Suze Orman: Can You Afford College, a Wedding, a Divorce?
Published on March 04, 2009
Please note: This is general information and is not intended to be legal advice. You should consult with your own financial advisor before making any major financial decisions, including investments or changes to your portfolio, and a qualified legal professional before executing any legal documents or taking any legal action. Harpo Productions, Inc., OWN: Oprah Winfrey Network, Discovery Communications LLC and their affiliated companies and entities are not responsible for any losses, damages or claims that may result from your financial or legal decisions.

NEXT STORY

Next Story

Comment

LONG FORM
ONE WORD