College game plan, Part 2: Student loan debt

"Back in the day, you had a lot of people going through school on the GI Bill or the Higher Ed act of 1965," Fudge says. "The way people paid for college was through 70 percent grants and 30 percent loans. But over the past 25 years, that's shifted to now 70 percent loans, 30 percent grants."

Families can also lose track of exactly how much debt they've taken on, and are sometimes shocked when the bill comes due.

"It sneaks up on people," adds Fudge. "They're not always aware of what they're borrowing year to year. You're not looking at what it means longterm."

There are big concerns nationally about this trend: Gabrielle Gurley writes in the winter issue of Commonwealth Magazine about student loan debt in our region.

Some observers say this is a near catastrophe for this generation, resulting in a delay in traditional life milestones like buying a home or getting married, or even moving out to live independently.

It's certainly scary stuff. But at the household level, if you've got a graduating senior, there are plenty of steps you can take to manage the debt.

"There's a lot of gloom and doom in the media about this," says ASA's public relations manager Allesandra Lanza, "but for every bad scenario, there's a solution. There might be some paperwork and you have to work through it. And the student has to be the pro-active one."

Some good resources include ASA website, which has a huge array of calculators, forms and guides that can help. The U.S. Dept. of Education also has resources for student borrowers.

Your senior needs to figure out exactly how much she owes, as well as the number and type of loan: federal or private. ASA offers an excellent Student Loan Survival Guide that includes a worksheet to list loans and their repayment schedules.

If your senior owes five figures, you may want to consider consolidation, says Fudge.

"It may not make sense to consolidate two $3,000 loans, but if they have seven or eight loans totalling $30,000, $40,000 or $50,000, then it may be in their interest to do it."

The ASA website has calculators that can help you determine the best repayment options for your situation.

Whatever route you take, it's a good idea to get a handle on your senior's debt now before he leaves school. You may actually find the situation isn't as bad as you think.

"People need to know that there really are options," says Lanza. "Whatever their situation is, if they can't find a job, they can postpone payment. If they need to stretch out their repayment terms, they can do that. If they need to tie it to income, there might be a plan. There are a lot of repayment options that are out there, and the sad thing is that people don't know about them."

If you missed Fudge's boston.com webinar on student loan debt, it's worth a look. Check it out here.

And if you missed my previous post, Helping your college senior develop a game plan, take a look. My students are telling me that their empty-nesting moms are reading the books I suggest here, so it looks like everyone can use some help once in awhile.