Just because you can, doesn’t mean you should.
This can be a very emotional topic or situation. It has to do with cosigning on another person’s loan.
Never cosign on a loan for a child, other family member, or friend. Love them. Encourage them in their goals, but never cosign on a loan for a family member or friend.
No one means for this to happen, but cosigning on another’s loan can alter and potentially damage your relationship with that person as well as put your financial health at risk.
If you have the funds to give and want to help, do so.
But, never-ever cosign on another’s loan.
Even if you love them.
Especially if you love them.
Simple, right?
It’s hard.
Try to keep in mind that if your signature is needed for a person to take out a loan, this means that the bank or lending institution does not currently consider them to be a viable candidate for the loan. In essence, the loan is being written to you, off of your guarantee and credit history, but the money is not going to you but to someone else.
If that other person cannot or does not repay the loan, even if everyone involved started off with the best of intentions, the loan will then be your debt to repay.
This often happens with parents or grandparents signing loans for a child’s education.
What to do, instead?
Parents, the runway is long.
You have eighteen years.
Save for your child’s education.
The no cosigning rule does not mean that parents do not have a responsibility to help pay for a child’s college education or technical training. Parents, save what you are able to, regularly, from baby’s first steps until baby is walking across the stage to receive a college diploma. Parents, save from baby’s first coo until you see your baby launched into the world with a certificate or with the technical skills to support themselves in the profession of their choice.
Mother believes in you - you can do this.
You don’t have to save a k’billion dollars. Calm the fuss down and look into opening a 529 plan. Save what you are able to, each and every month - make it a habit, and you will be surprised at how your child’s educational savings will grow and grow over the years.
Compounding magic —- if you save from when your child is a baby, you might find that for every dollar you withdraw to pay for their education or training, 30% of the money is from the money you squirreled away (saved), and 70% is from the investment gains you received on those savings.
You saved some money. Over time, it grew. It got big and beautiful.
Money magic in action.
Practically, saving for a child’s education can at first look like ten dollars a week put into a 529 plan, and prioritizing increasing the amount as the family is able to and as the child grows. Babies come with great joy as well as new expenses; try and plan for at least a modest amount to be saved away for their future, each month, from their birth. Friends and family might feel good about gifting to a child’s 529 fund over the years. This is Mother’s favorite gift to give a child. Families can think about camping and staycations two out of three or four out of five years with the savings going into an educational fund. Once a child starts kindergarten or first grade, seriously look at putting up to half of any savings from no longer needed or lessened daycare expenses towards future educational costs.
Do something. Have a plan. See what makes sense for your family. You can do this, imperfectly and looking like a bit of a mess some years, better, others. With a plan and steady habits, personal finance dreams do come true.
Anyone faced with taking out a loan to finish up a college degree? Pause. Consider taking a year off, working and saving, and then going back to school. This is instead of being weighed down, possibly for decades, with a solo loan or having a parent cosign on an educational loan.
It’s important to get back into the educational swing of things once enough money is saved up to complete school. College costs a lot, but the most expensive college education is the one that a person starts and then does not finish.
Know a student thinking about taking out college loans? Encourage the student to look into attending a school that’s within their family’s budget. Try starting at a local community college and pay as you go. If possible, a young person can live at home for a year or two to economize and work towards their educational goal. Some schools have generous grant programs that significantly bring down the cost of education. Unlike loans, a grant is a type of financial assistance that doesn’t need to be paid back.
Better yet, parents, prioritize and save from the get-go.
With a child, even modest amounts regularly saved add up to positive and life-changing options that stem from a fully paid college degree or trade school education.
Cosigning on loans for college, cars, or other types of credit calls for a kind but firm, “no.”
You will probably feel uncomfortable and they will most likely feel disappointed. Doing the right thing can sometimes make for sadness.
It will be okay.
Set a boundary.
It will be okay.
The sun will come up in the morning.
The stars will continue to shine at night.
You are still loved.
You have permission to say, “no” to cosigning on another’s loan.
Mother is not a financial advisor. Mother is sharing knowledge with you that she has learned over many years. Mother knows that you deserve a place at the table of healthy personal finances.
Caring for your finances, that’s so wholesome.
:-)
Now for a recipe to add to your home economics knowledge.
Calling all ancient grains!
Nutty.
Chewy.
Hearty.
Farro
Farro is a type of hulled wheat that you can cook on the stovetop and keep on hand in your refrigerator to toss into soups, salads, or as a side with your meals.
Farro is a healthy building block to use in creating satisfying and tasty meals.
With farro, you get protein to help your body build and repair muscles and bones. There’s magnesium to aid in regulating muscle and nerve function, your blood sugar levels, as well as moderating blood pressure. Zinc is found in farro, which supports your immune system. Farro is also high in fiber, which is good for your gut health. A healthy gut supports physical health, mental health, and helps to regulate your sleep. Farro contains a variety of B vitamins, helping with red blood cell formation as well as working with other nutrients in order to effectively release energy from the foods we eat. B vitamins help to regulate your mood and reduce anxiety. Farro is a nutritional superfood.
Farro is also super easy to prepare.
1 cup farro, rinsed.
3 cups water
Bring farro and water to a boil in a saucepan on your stovetop. There’s no need to add salt to the water. Let the water and farro boil for 1 minute, turn the heat down to a medium-low simmer, cook uncovered for 10 minutes, and check to see if the grains are cooked.
Many recipes will indicate that you should cook farro for 30 minutes. Cook for 30 minutes if you want to make super mushy farro. Go ahead, for a mushy mess, follow the instructions on the back of the Bob’s Red Mill bag and cook the hell out of your farro.
If you want a chewy farro with a bit of bite, test it at 10 minutes, and if not tender enough, check it every 2 minutes, thereafter. I’ve never cooked farro for over 15 minutes.
Once cooked, drain off any excess liquid, go ahead and use, or cool and refrigerate the farro to be eaten over the next four days.
You matter.
You deserve to have the building blocks for healthy meals on hand.
Mother Loves you.
You are doing a good job.
As always,
Love from Mother
Apple blossoms are today’s treat for the honeybees and will eventually be applesauce, a welcome staple for next fall through winter. (Photo credit Hidetaka Inoue)