Grads with more debt less happy

[quilter]

http://money.cnn.com/2014/05/06/pf/college/student-debt-well-being/index.html?iid=EL

Wow, you really had to stretch to come up with this conclusion. No kidding. Sometimes these articles (like the cut down on your daily fancy coffees to save money articles) must really think we are all idiots. I wonder how much the survey cost? 

[CarDude]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

[jasman18]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

How do you figure?

[lisahi]

http://money.cnn.com/2014/05/06/pf/college/student-debt-well-being/index.html?iid=EL

Wow, you really had to stretch to come up with this conclusion. No kidding. Sometimes these articles (like the cut down on your daily fancy coffees to save money articles) must really think we are all idiots. I wonder how much the survey cost?

I have a lot of debt (law school, yay!), and I can't say I'm unhappy.  That said, I would have an extra few hundred dollars per month (at least) to stick in my stache if I didn't have the debt.  I could have started maxing out my TSP account much earlier if I didn't have the debt. Let's just say I'm kicking myself for not going to my home state law school that basically offered me a free ride.  Instead I went to the more prestigious law school that was still a state school, but one that cost a fortune.  I probably would have wound up in the same job either way.

[odput]

/snip
I probably would have wound up in the same job either way.

As I get a little more experience (I'm 28 now) I'm finding more and more that, at least in my line of work, people care more about what you have done professionally and less about where you went to school.  It seems like the Ivy League pedigree is mostly for landing your first job. 

Maybe it's different in the cultures the Ivies play into, business, law, finance and such, but in the manufacturing world, nobody seems to give a shit.

And not once during an interview was I ever asked what my GPA was

[simonsez]

/snip
I probably would have wound up in the same job either way.

As I get a little more experience (I'm 28 now) I'm finding more and more that, at least in my line of work, people care more about what you have done professionally and less about where you went to school.  It seems like the Ivy League pedigree is mostly for landing your first job. 

Maybe it's different in the cultures the Ivies play into, business, law, finance and such, but in the manufacturing world, nobody seems to give a shit.

And not once during an interview was I ever asked what my GPA was

Totally, been at my first career type job for over 3 years now and I updated my resume for the first time since just this week.  It's amazing how the focus shifts from my education on my old one (where I had to put minor GPA! to fill up space) to my work experience on the new one (which doesn't list any GPA's as the space was too scarce to let that nonsense fill it up).

Not that I would change too much about my choices at the end of undergrad or for grad school (and debt accompanying that) but I agree after your foot is in a door, it doesn't matter. 

[nawhite]

http://money.cnn.com/2014/05/06/pf/college/student-debt-well-being/index.html?iid=EL

Wow, you really had to stretch to come up with this conclusion. No kidding. Sometimes these articles (like the cut down on your daily fancy coffees to save money articles) must really think we are all idiots. I wonder how much the survey cost?

I have a lot of debt (law school, yay!), and I can't say I'm unhappy.  That said, I would have an extra few hundred dollars per month (at least) to stick in my stache if I didn't have the debt.  I could have started maxing out my TSP account much earlier if I didn't have the debt. Let's just say I'm kicking myself for not going to my home state law school that basically offered me a free ride.  Instead I went to the more prestigious law school that was still a state school, but one that cost a fortune.  I probably would have wound up in the same job either way.

Our family's student loan debt is the biggest (pretty much only) source of unhappiness we have. Without them, our net worth would be over $200k now (assuming lifestyle inflation hadn't hit us) and we would both be working jobs we love (have both gotten multiple offers, just can't afford to leave higher paying jobs to kill the debt). Both of us feel like the lives we want to live have been put on hold for 5 years.

My school definitely opened up some awesome paying opportunities that wouldn't have been available to me at a less prestigious school, but when my working career (thanks to mustachianism) is only going to be 10 years long, the loans make the prestigious school much less worthwhile. If I were going to keep working for 45 years, then it definitely would have been a good investment. As is, not really. 

[CarDude]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

How do you figure?

Eventually people are either going to stop going to college, stop buying houses, or stop paying their loans. Its one thing to try to pay off loans right now when the average student with them is graduating with 27k worth, 1/4th of all recent graduates are unemployed, and the median new home costs around 182k...however, as college prices keep going up, there'll become a point where people aren't going to even try to pay off 100k loans and buy homes in the same lifetime, because that $10/hr post-college job won't make that possible. Something in the low wage, high expense economy is going to have to give.

[shotgunwilly]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

How do you figure?

Eventually people are either going to stop going to college, stop buying houses, or stop paying their loans. Its one thing to try to pay off loans right now when the average student with them is graduating with 27k worth, 1/4th of all recent graduates are unemployed, and the median new home costs around 182k...however, as college prices keep going up, there'll become a point where people aren't going to even try to pay off 100k loans and buy homes in the same lifetime, because that $10/hr post-college job won't make that possible. Something in the low wage, high expense economy is going to have to give.

I actually see a point in the future where the trend reverses and alot of people do not go to college, once people awaken to the fact that alot of these college degrees aren't worth the money and college isn't "required" for you to be successful or make alot of money.  I think we're already starting the reverse to where skilled trades (and people that are actually willing to sweat) will be paid more than positions which traditionally required higher education. (excluding doctor, lawyer, etc) I could be wrong.

[jasman18]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

How do you figure?

Eventually people are either going to stop going to college, stop buying houses, or stop paying their loans. Its one thing to try to pay off loans right now when the average student with them is graduating with 27k worth, 1/4th of all recent graduates are unemployed, and the median new home costs around 182k...however, as college prices keep going up, there'll become a point where people aren't going to even try to pay off 100k loans and buy homes in the same lifetime, because that $10/hr post-college job won't make that possible. Something in the low wage, high expense economy is going to have to give.

Cant really be a "bubble" then. Its not a private market and the debt is guaranteed by the government.
Almost all the loans are backed by the government. It's not likely all the people will stop paying.
Laws are not going to suddenly change allowing people to discharge student loans in bankruptcy.

[skunkfunk]

Yeah, the debt bubble is going to pop someday. Just a matter of time.

How do you figure?

Eventually people are either going to stop going to college, stop buying houses, or stop paying their loans. Its one thing to try to pay off loans right now when the average student with them is graduating with 27k worth, 1/4th of all recent graduates are unemployed, and the median new home costs around 182k...however, as college prices keep going up, there'll become a point where people aren't going to even try to pay off 100k loans and buy homes in the same lifetime, because that $10/hr post-college job won't make that possible. Something in the low wage, high expense economy is going to have to give.

Cant really be a "bubble" then. Its not a private market and the debt is guaranteed by the government.
Almost all the loans are backed by the government. It's not likely all the people will stop paying.
Laws are not going to suddenly change allowing people to discharge student loans in bankruptcy.

http://www.businessweek.com/articles/2014-05-06/you-can-get-student-loans-forgiven-in-bankruptcy-but-its-far-from-easy#r=hpt-ls

[jasman18]

http://www.businessweek.com/articles/2014-05-06/you-can-get-student-loans-forgiven-in-bankruptcy-but-its-far-from-easy#r=hpt-ls

so .1% of people have been able to fully discharge loans. I bet the spendthrifts have hope.

[CarDude]

Not everyone has to stop paying for things to change; enough simply have to either stop paying, stop attending, or stop spending in other expected areas (e.g., housing, general consumerism) to convince the government that the loans are choking the economy, and all of a sudden, you'll start hearing talk of 'forgiveness' and 'amnesty' and whatnot. Housing attainment has already started dropping among the sub-30 crowd, simply because they lack the money to pursue even 5% (or less!) down payments. Historically, adults with student loans were more likely to pursue home ownership, but that's flipped in recent years, and that's just one of many signs that the student loan issue is going to become an inconvenience the government can't ignore.

[EngineerMum]

I think here in Australia it's already starting to become obvious that you're better off to do a skilled trade (plumbing/ electrician etc) than go to uni, when a good professional wage is $100 - $200k and a tradie can earn that as soon as they finish their apprenticeship and start their own business. Hey, I know someone who earns 6 figures as a lawn mower man! Whereas an end of career teacher, in the private system (paid more) taking on head of department role (paid more) is just barely pushing $100k. And many non-vocational degrees lead to risky jobs in the public service that are unlikely to reach $100k even by career end. Our company has some roles for environmental scientists that are paid WAY less than that, and people are clamouring to take them - that's with a 4 year degree and doing 45 hours min per week, mostly in the field (so away from home most week nights). Why would you accept the opportunity cost of forgoing 4 + years of income, paying upwards of $25k for the privilege (our uni costs less - at least for the moment - than yours, but there are practically NO scholarships, and community / state college does not exist) for a lower wage? Something has got to give.

[darkadams00]

When I was paying off my student loans, I walked several blocks to the main office here in town. I asked the "advisor" how to pay ahead on my principal since I wanted to be free and clear in a few months. She said she had worked there for almost a year and never had anyone to ask her that question. She knew every legal way to defer payments because those were the questions she answered daily. I ended up getting the information from her manager. So either the "regular customers" are just paying the minimums on time or deferring until later. Either option is fine if the numbers work, but I was just surprised that paying ahead seemed to be so uncommon.

With one in college and one starting this fall, this is a topic that comes up often. Other than a nephew who finished his BS and MS with $4K in loans and children of friends who were prepared to pay in full, every kid among my friends' families has easily surpassed the $30K mark in loans before finishing undergrad. Even kids whose parents offered to pay up to half of the expenses! It seems the kids just compared notes with their friends, found out their friends were carrying a full load of debt, and loaded up with the other half to buy unnecessaries since it was all just Monopoly money anyway. They all planned to get great-paying jobs at the end of the line, right?

I don't think this trend is going to change unless restrictions are put on the funds, or the middle-class parents' expectation of a college-educated child declines. The first option would likely require government intervention and the second would require social change. Those are not short term objectives.

[capital]

It seems like the Ivy League pedigree is mostly for landing your first job. 

Maybe it's different in the cultures the Ivies play into, business, law, finance and such, but in the manufacturing world, nobody seems to give a shit.

The actual Ivies (other than Cornell and maybe Columbia) have enormous endowments and offer a ton of financial aid for people from lower-income families (meaning sub-$100k in the Ivy context). It's the less-well-endowed private schools that really get people caught in the debt trap.