Much has been made of the fact that today’s college students are more indebted than ever. But the tide is turning, with more of the college-financing burden shifting to parents—something being encouraged by private lenders and colleges. As a result, now it isn’t just that young people are starting their careers under the weight of a heavy debt load; many parents are ending their careers under such weight, which may be even more problematic.

When a PLUS is a negative

Over the last 25 years, an increasing portion of federally subsidized education loans has shifted to parents. Whereas parents made up just 4% of all federal education loan borrowers in the 1989-1990 academic year, they accounted for 20% in the 2011-2012 academic year—the most recent year for which data are available, according to an article in MarketWatch.

The average balance for these so-called PLUS loans grew from $15,323 to $40,154 in that time. Perhaps not surprisingly, in 2013, 17% of PLUS loans held by borrowers age 65-74 were in default. In that situation, the government has the power to garnish a portion of Social Security benefits to get paid.

Private lenders getting in on the action

Private lenders are jumping on the loan-to-the-parents bandwagon. According to a Wall Street Journal article, several universities approached private lenders, asking them to make education loans available to parents who were looking for more financing options.

Unlike federal loans to parents, private lenders do not charge an upfront fee (the government charges nearly 4.3% to cover the costs to originate and guarantee the loans), and for creditworthy borrowers, private loans may charge a lower interest rate.

Schools apparently like it when parents do the borrowing, in part, because such loans are not included in a scorecard in which the U.S. Education Department discloses universities’ median student debt at graduation, a statistic some families use as a gauge of a school’s affordability.

Difficult choices

Paying for college has become a complicated puzzle, which is made all the more challenging because of parents’ desires to see their kids succeed. But it’s clear that a heavy debt load is not a good option for students or parents.

What to do instead?

Make a commitment in faith not to borrow for college. Start there and then work on the details.

As difficult as this option may be to entertain, consider: should your child even go to college?

Consider having your child take a gap year after high school to earn money for college while better discerning what to study. As the New York Times reported, just 19% of students at public universities graduate in four years. Many students simply don’t know what they want to study, so they change majors a time or two, lengthening the time they spend in school and driving up the cost.

Consider having your child go to community college for two years while living at home and then transferring to a four-year school that you’ve predetermined will accept the community college credits.

Choose a state school instead of a private school. In a study cited in the book “Debt-Free U," students who qualified for a prestigious school but decided to go to an affordable state school instead typically ended up doing just as well in their career as the ones who went to more prestigious schools.

Have your child work part-time while in school and full-time during the summer.

Parents of younger kids, start saving in a 529 college savings plan and/or Coverdell Education Savings Account as early as possible.

If someone has to take out a loan, let it be your child. Then show him or her how much that will cost on a monthly basis upon graduation and make sure they understand what the implications are (probably living with roommates, perhaps not having a car, etc.). A recent study showed most students do not understand what they’ve gotten themselves into with their school loans.

Bottom line? Do not sacrifice your later life financial security for the sake of your kids’ college education.

What are your thoughts on this topic?