Personal Finance & Money Asked by smartButNotSavvy on December 8, 2020
I graduated in 2017 with a bunch of student debt that my parents held on my behalf (~$130k). My sibling went to the same university as me and my parents also took out debt to fund her education. However, the only needed to take out half as much ($65K) because the school gave more financial aid. The reason why my parents received more financial aid was strictly because their financial situation had deteriorated (partly because of the loan they took out for me). My sibling and I got the same degree.
My sibling (2 years younger) and I are now paying each of our loans off respectively, but it struck me recently that this might be unfair. By virtue of my sibling being 2 years younger, they’ll pay half as much for their education as me despite having the same education and family.
I pitched that we should pool our debt and pay it off together. Of course, because my sibling is two years younger, there’d be some structuring to do here so that it’d be fair, but this ended poorly. My sibling felt betrayed that I would ask for that and thought I was trying to scam them. Obviously, this solution benefits me at their expense but I genuinely believe it’s the fairest thing to do and I would do it if the situation was reversed.
Before considering more drastic options, I wanted to get this community’s thoughts:
I’m mindful that this isn’t a purely financial topic, so definitely let me know if there’s a better forum for this. Thank you.
In general your student loans and your sibling student loans are two separate things. You knew full well the cost and conditions of your education when you signed on the dotted line. Whether your sibiling got better terms or not, isn't particularly relevant.
Example: let's say you buy a car and then two years later your sibling buys the same car two years later but due to a massive sales event, they get it for $5000 less. Would you expect them to give you $2500 just because you paid more ? It's not "fair" but that's life.
However, there seems to be some entanglement between your two loans, that I don't fully understand. If your parents are subsidizing some of part of it, it's up to your parents how much they want to subsidize each child. You also appear to be a co-signed of your siblings loan, but it's unclear what exactly that means.
Overall you want to have these discussions BEFORE you make a decision. In essence you have created a contract and you currently want to re-negotiate this in hind-sight. That's guaranteed to ruffle feathers. For example: your sibling can claim "I would have never went to this college if I knew it was that expensive".
Answered by Hilmar on December 8, 2020
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