First Person: I’d Never Take a Loan Out for Day Care

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I can't fathom living in a situation in which it made sense to take out a loan in order to send my child to day care. As a parent of two young adult sons, it scares me to think they could ever feel the social pressure to take out what some are calling a "government-subsidized student loan for toddlers." I'd be more than willing to watch my future grandchildren free of charge. According to a recent article by MoneyBox, New York City mayoral candidate Christine Quinn wants to offer loans up to $11,000 for parents with children ages 2 to 4. While it's true that early-childhood education is important, it's not about investing money as much as it's about investing time.

Setting up a debt trap

In my opinion, Quinn is setting up parents for financial hardships down the road. Moreover, she is sending a message that parents are too incompetent to educate and care for their own children. Many of the Millennials with children in day care already have student loan debt. They could contribute more to the lives of their children if they didn't have to worry about making student loan as well as child-care loan payments. Day care lending is troubling on so many levels. I hope Quinn's little "pilot" program never branches out beyond New York. I am encouraging my sons to avoid student loan debt of any kind.

Moving to another state

As a resident of Florida, I see a lot of New York license plates. I can understand why people would want to move out of New York to find a more affordable place to live. I recently helped a relative send his license plates back to the DMV in New York after moving to Florida. According to a CNN article, it can cost $2,300 a month to send a child to day care in Manhattan and $1,700 a month in Brooklyn. The solution isn't to take out loans, but to either move or be a stay-at-home parent with the confidence to raise a child. I never spent more than $2,300 a year on child care for my children. I was able to find reliable and caring stay-at-home moms who watched my children when I had work assignments.

Paying another tax

In essence, parents who don't run as quickly as possible away from this government money will be paying voluntary taxes to the government. As a student loan, it's likely these loans won't be dischargeable in bankruptcy. I recently heard a caller to the "Suze Orman Show" ask if she could afford to send her child to a preschool program in New York. Orman said she couldn't afford it. In the end, parents who fall for this loan trap will end up hurting their children when they can't afford to save for college or pay for other priorities.

I hope New Yorkers are wise enough to walk away from the life of an indentured servant. If New York comes after people who don't pay their parking tickets for around $100, how much likely will they come down hard on people who don't pay back their day care loans for 10 times as much? I'm staying as far away from New York as possible because the politicians there seem completely Machiavellian, or at least, out of touch.

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