Author Topic: Waah! It's impossible to ever pay off student loan debt! (Article)  (Read 8103 times)

WhiteTrashCash

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https://truththeory.com/2019/08/14/these-alarming-posts-shows-how-bad-the-student-debt-system-is-affecting-people-lives/?fbclid=IwAR0_CuwNqKg1DsB8KAV1NpqJPeY4JzGGzbC8ETkzuMl1ugNaSkQPL8wKH2Q

"Please, rich people, step in and save me from having to repay money I willingly borrowed so I could finance the training for my career! It's impossible to ever repay $30,000. This debt will follow me until my dying days!"

Meanwhile, I have personally paid off $41,000 of the $74,000 of student loans I borrowed to finance my education and I'm on track to have it paid off entirely within the next three years.

"Everybody says 'don't buy avocado toast' and 'don't drink Starbucks', but that makes absolutely no difference in paying off debt!"

Yeah, you have to make your own avocado toast, make your own coffee, pack your own lunch, make your own dinners instead of paying for takeout delivery apps, ride a bicycle or walk instead of drive, get movies and books from the library instead of buying them, get clothes at the thrift shop instead of new from fashion boutiques, clean your own house instead of hiring a service, etc. etc. etc.

"It's all the Boomers' fault. Nobody ever had to do anything before our generation. Everyone just had $100,000 jobs handed to them when they graduated from high school and the world was a Utopia before the Boomers came along and burned the nation to the ground before urinating on the ashes."

Actually, a lot of people didn't have the opportunity for education back during the Boomer generation and a lot of people suffered for it, which is why LBJ's Great Society programs were enacted. The Boomers caught the worst of it when all the big industries were shipped overseas between the 1970 and 1990s and they were hit square in the face in their retirement years by the Great Recession (which you probably don't remember because that happened back in 2008-2009 before Snapchat existed.)

"You need to pay my student loan debt for me! I can't possibly be expected to pay my own bills."

No, shut up.

Not There Yet

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #1 on: August 15, 2019, 10:56:03 PM »
Quote
"It's all the Boomers' fault. Nobody ever had to do anything before our generation. Everyone just had $100,000 jobs handed to them when they graduated from high school and the world was a Utopia before the Boomers came along and burned the nation to the ground before urinating on the ashes."

THANK YOU!  As a Boomer who came of age during the era of "stagflation" (double-digit inflation, double-digit unemployment), I appreciate someone who realizes we didn't have everything handed to us.  I didn't have any student debt, but I completed my lower-division classes at a community college and completed my degree at a state university.  I also went to night school while working full-time during the day, lived in crappy apartments and drove a crappy Plymouth Horizon that I used to glue back together with three-minute epoxy.  I'm retired now, but I never made $100,000 a year - not even close.

CarolinaGirl

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #2 on: August 16, 2019, 06:22:41 AM »
I’ve also been seeing more comments lately about how the Boomers were a horrible generation.  Just blows my mind...  I couldn’t be more proud of ALL 4 of my grandparents and how they hustled and busted their asses for everything they achieved in life.  Best role models ever!

Travis

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #3 on: August 16, 2019, 07:02:13 AM »
Please tell me whatever it was I just read doesn't count as journalism. It's just a collection of unverified memes and Twitter rants.

FIRE47

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #4 on: August 16, 2019, 07:04:06 AM »
I was with you until the Snapchat comment - settle down grandpa.

The truth is somewhere in the middle - things are different now but really not that bad compared to most generations in human history. Just worse than the last couple by the few measures relating to student loans. 30k in debt isn’t a life sentence but it sure is worse than none.

fattest_foot

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #5 on: August 16, 2019, 08:03:36 AM »
THANK YOU!  As a Boomer who came of age during the era of "stagflation" (double-digit inflation, double-digit unemployment), I appreciate someone who realizes we didn't have everything handed to us.  I didn't have any student debt, but I completed my lower-division classes at a community college and completed my degree at a state university.  I also went to night school while working full-time during the day, lived in crappy apartments and drove a crappy Plymouth Horizon that I used to glue back together with three-minute epoxy.  I'm retired now, but I never made $100,000 a year - not even close.

This is a story I notice a lot of people with very large student loans don't have. They didn't work a single day in college and they also went straight to a 4 year university (which apparently they couldn't afford).

It's hard for me to have empathy when someone doesn't even try.

There are certainly people that were taken advantage of by the system, and definitely those who got loans for good reasons, but I think they're the minority.

Not There Yet

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #6 on: August 16, 2019, 08:13:07 AM »
I actually got into a (pointless) argument with someone on Facebook about this.  He was complaining about having to go into debt to go to college.  I suggested going to community college and transferring to a state school, as well as working during college to reduce the amount of debt he'd have to take on.  The response was, "Well, I have to go into debt anyway, so I might as well enjoy the college experience".  There it is.  It's not about preparing for a profession.  It's about maximizing the "experience". 

The article isn't as bad as the headline - https://nypost.com/2017/11/18/you-can-count-on-getting-squat-when-your-parents-die/

How are boomers screwing their kids?  By having the audacity to live long enough to spend their retirement savings, thus "cheating" their millennial kids out of their inheritance.
« Last Edit: August 16, 2019, 08:21:50 AM by Not There Yet »

Just Joe

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #7 on: August 16, 2019, 08:14:51 AM »
"Please, rich people, step in and save me from having to repay money I willingly borrowed so I could finance the training for my career! It's impossible to ever repay $30,000. This debt will follow me until my dying days!"

Meanwhile some of them are paying down one or even two expensive vehicle notes, taking vacations, etc. Some of them. I recognize that there are people who are genuinely struggling without the frivolous spending. We need to separate the two those conversationally.

DW had $45K worth of student loans for an advanced degree to advance her career. We paid it down in about three years by being frugal in ways commonly discussed here in the forums - and while paying on a mortgage and childcare expenses.

lookingforadelorean

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #8 on: August 16, 2019, 08:16:18 AM »
I think anyone can cherry pick anecdotal evidence to support their side of the argument. But when you consider the overall economic picture, it’s easy to see why current students feel disadvantaged. Also from that article:

Since 1987 when adjusting for inflation, the % increase in:

➡️ Tuition costs at public universities : 183%
➡️ Tuition costs at private universities: 142%
➡️ Minimum wage: 20%
➡️ Early career salaries: 3%

Let’s not forget that many (most?) boomers got jobs with pensions. Hell, my grandmother went back to work at a Kraft factory slicing cheese after she raised her six children. She got a pension with that job AND it included lifetime medical benefits! How many people of any generation have that kind of compensation now?

Not There Yet

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #9 on: August 16, 2019, 08:42:08 AM »
That type of "corporate socialism" ending in the 1980's.  Unless they worked in government or stayed with the same employers for their entire careers (and those employers had pension plans), boomers are not that likely to have pensions of any consequence.  Medical retirement benefits are rarer still.  If millennials want to blame someone for the student loan crisis, the retirement crisis and the healthcare crisis, they should blame the "greatest generation".  The laws and policies that set these problems in motion began with the Reagan administration. 

fattest_foot

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #10 on: August 16, 2019, 08:48:54 AM »
Let’s not forget that many (most?) boomers got jobs with pensions. Hell, my grandmother went back to work at a Kraft factory slicing cheese after she raised her six children. She got a pension with that job AND it included lifetime medical benefits! How many people of any generation have that kind of compensation now?

Pensions never went above 50% of the population. I think the high was only around 40% of people were ever eligible for one.

They were also only ever a thing for about 2 generations (maybe 3). Prior to that, retirement as a concept wasn't really a thing outside the aristocracy.

Not There Yet

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #11 on: August 16, 2019, 09:17:05 AM »
Quote
Didn't most people make a big deal about the inheritances they were getting back in the 80's and 90's?

I don't know anyone who inherited anything in the 80's and 90's.  As for myself, the inheritance from my greatest generation parents is in a trust that goes to the millennial grandchildren, skipping my (boomer) generation.

lookingforadelorean

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #12 on: August 16, 2019, 09:27:02 AM »
My point in bringing up pensions was to provide an example of how the overall economic picture has changed for millennials. I’m not blaming lack of pensions for their student debt, but I do think it could be considered one of the contributing factors when it comes to millennials or Gen Z (or even Gen X) having a harder time reaching the financial stability of previous generations. They can pull themselves up by the bootstraps, but they’re still walking into a completely different landscape.

https://money.cnn.com/retirement/guide/pensions_basics.moneymag/index7.htm

“The percentage of workers in the private sector whose only retirement account is a defined benefit pension plan is now 4%, down from 60% in the early 1980s. About 14% of companies offer a combination of both types.”

dcheesi

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #13 on: August 16, 2019, 09:51:40 AM »
Part of the problem is that enough things change between generations that the roadmap kids are brought up with is no longer reliable. To some degree Millenials got blindsided by the student loan issue, in large part because their own parents were encouraging a mindset that made sense for their own generation, without fully considering the changing educational landscape.

By contrast, my gf's daughters are just starting college, and by all accounts they and their generation are far savvier about college costs and the value of different degrees. It seems they've learned from the example of the Millenials. But I worry that they'll inevitably get caught out by some other socioeconomic change, one that's already underway but that we've so far failed to identify.

partdopy

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #14 on: August 16, 2019, 10:25:10 AM »
I think anyone can cherry pick anecdotal evidence to support their side of the argument. But when you consider the overall economic picture, it’s easy to see why current students feel disadvantaged. Also from that article:

Since 1987 when adjusting for inflation, the % increase in:

➡️ Tuition costs at public universities : 183%
➡️ Tuition costs at private universities: 142%
➡️ Minimum wage: 20%
➡️ Early career salaries: 3%

Let’s not forget that many (most?) boomers got jobs with pensions. Hell, my grandmother went back to work at a Kraft factory slicing cheese after she raised her six children. She got a pension with that job AND it included lifetime medical benefits! How many people of any generation have that kind of compensation now?

Your numbers simply show a market propped up by a vast increase in customers and easy financing, in many cases for degrees that shouldn't be gotten at all.

Is the University responsible for telling a student their degree is not likely to be worthwhile, or to persuade them not to take a loan?  No, the student is responsible to research these things.

If people were not able to get loans with any type of tax payer guarantee, and instead forced to self fund or get private loans, there wouldn't be such a huge increase in tuition or number of students.  Students would have to pick degrees that the financier thought would be able to pay back the loan amount, and show aptitude in that area indicative of the ability to actually excel.

FIRE47

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #15 on: August 16, 2019, 12:02:03 PM »
I think anyone can cherry pick anecdotal evidence to support their side of the argument. But when you consider the overall economic picture, it’s easy to see why current students feel disadvantaged. Also from that article:

Since 1987 when adjusting for inflation, the % increase in:

➡️ Tuition costs at public universities : 183%
➡️ Tuition costs at private universities: 142%
➡️ Minimum wage: 20%
➡️ Early career salaries: 3%

Let’s not forget that many (most?) boomers got jobs with pensions. Hell, my grandmother went back to work at a Kraft factory slicing cheese after she raised her six children. She got a pension with that job AND it included lifetime medical benefits! How many people of any generation have that kind of compensation now?

Your numbers simply show a market propped up by a vast increase in customers and easy financing, in many cases for degrees that shouldn't be gotten at all.

Is the University responsible for telling a student their degree is not likely to be worthwhile, or to persuade them not to take a loan?  No, the student is responsible to research these things.

If people were not able to get loans with any type of tax payer guarantee, and instead forced to self fund or get private loans, there wouldn't be such a huge increase in tuition or number of students.  Students would have to pick degrees that the financier thought would be able to pay back the loan amount, and show aptitude in that area indicative of the ability to actually excel.

Now what though? Even the kid taking something “worthwhile” is facing the increased costs. You think the institutions would survive if the rug was suddenly pulled out?

Wrenchturner

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #16 on: August 16, 2019, 01:24:51 PM »
In addition to tuition inflation, I'd also lay this problem at the feet of the yawning delta of responsibility between high school and post sec.  You go from virtually no responsibility, and worrying about next week's coursework, to having your future in your hands and easy access to piles of your own future earnings.  So it's not surprising many students leave post sec feeling ripped off. 

Better financial education should occur earlier, and I believe this is the responsibility of the parents.  (Public education already dispenses far more knowledge than gets recieved).

mm1970

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #17 on: August 16, 2019, 02:17:55 PM »
Have I ever been so happy to be Gen X?  Keep ignoring us.

The truth is somewhere in the middle, naturally.

Also, anecdotes:

4 of my boomer siblings are retired.  Two with pensions, two without.

My boomer FIL and 3 of his siblings are retired all with pensions (that's 4 out of 6).  Other 2 sibs not retired, but they won't have pensions.
My boomer BIL is retired with a pension.

My dad retired with a very small pension ($100 a month?)  He lived on <$900/month social security.

Of the four remaining not-retired kids in my family - three of us will not have pensions (including me) and one will (the prison guard).
« Last Edit: August 16, 2019, 02:21:09 PM by mm1970 »

kite

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #18 on: August 16, 2019, 02:21:35 PM »
I think anyone can cherry pick anecdotal evidence to support their side of the argument. But when you consider the overall economic picture, it’s easy to see why current students feel disadvantaged. Also from that article:

Since 1987 when adjusting for inflation, the % increase in:

➡️ Tuition costs at public universities : 183%
➡️ Tuition costs at private universities: 142%
➡️ Minimum wage: 20%
➡️ Early career salaries: 3%

Let’s not forget that many (most?) boomers got jobs with pensions. Hell, my grandmother went back to work at a Kraft factory slicing cheese after she raised her six children. She got a pension with that job AND it included lifetime medical benefits! How many people of any generation have that kind of compensation now?

There was never a golden era when most people had fat pensions; it's always been less than half of all jobs. Forty years ago, only 38% of jobs had defined benefit plans.  Today, it's half that number -- largely public sector unions.  The payouts from defined benefit plans are not as generous as it would seem, with median private pensions paying around $9K/year. 

Community College tuition rates have not increased at those rates.  And 17 states offer free tuition to community college students.  If families just said no to paying the inflated prices at state and private universities, the schools would have to lower the price.  But the availability of limitless amounts of loans has obfuscated the costs that families agree to pay. 

YttriumNitrate

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #19 on: August 16, 2019, 02:37:26 PM »
In case anyone anyone missed it, the twitterer who posted
Quote
I graduated from law school 6 years ago with $250,000 of student loan debt. But after years of hard work and tens of thousands of dollars of payments, I can officially say that I now owe $315,000.Hooray!
also writes a blog called Optimize Your Life. (optimizeyourlife.co) He's a public sector attorney on track for PSLF. (http://www.optimizeyourlife.co/bonus-the-student-loan-tweet-responses).

The author of the article probably should have spent a few minutes checking their sources.

WhiteTrashCash

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #20 on: August 17, 2019, 07:41:24 PM »
I was with you until the Snapchat comment - settle down grandpa.

The truth is somewhere in the middle - things are different now but really not that bad compared to most generations in human history. Just worse than the last couple by the few measures relating to student loans. 30k in debt isn’t a life sentence but it sure is worse than none.

One of my wife's interns tried to submit their paperwork at work by Snapchat, she told them that it was unacceptable and they would have to submit it in a permanent way by e-mail and they cried to her supervisor about it. Like a baby. The intern was smacked down by the boss for their wimpy ways as well. No sympathy.

Probably about 99.99% of all of these so-called important lifestyle apps are complete bullshit and add nothing to anybody's lives. Meanwhile, all the hipster Silicon Valley angel investors pour their money into this nonsense. Remember when someone paid $1 million for an app that only sent the word "yo". It's almost as bad as back in 2000 when half the superbowl commercials were for fake ibusinesses that didn't actually sell any products.

Paul der Krake

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #21 on: August 18, 2019, 12:45:44 AM »
One of my wife's interns tried to submit their paperwork at work by Snapchat, she told them that it was unacceptable and they would have to submit it in a permanent way by e-mail and they cried to her supervisor about it. Like a baby. The intern was smacked down by the boss for their wimpy ways as well. No sympathy.
The only takeaway here is that your wife's company hires low-quality interns. Good students have multiple internship offers from desirable companies and pick the best.
« Last Edit: August 18, 2019, 12:48:10 AM by Paul der Krake »

FIRE47

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #22 on: August 18, 2019, 05:55:58 AM »
I was with you until the Snapchat comment - settle down grandpa.

The truth is somewhere in the middle - things are different now but really not that bad compared to most generations in human history. Just worse than the last couple by the few measures relating to student loans. 30k in debt isn’t a life sentence but it sure is worse than none.

One of my wife's interns tried to submit their paperwork at work by Snapchat, she told them that it was unacceptable and they would have to submit it in a permanent way by e-mail and they cried to her supervisor about it. Like a baby. The intern was smacked down by the boss for their wimpy ways as well. No sympathy.

Probably about 99.99% of all of these so-called important lifestyle apps are complete bullshit and add nothing to anybody's lives. Meanwhile, all the hipster Silicon Valley angel investors pour their money into this nonsense. Remember when someone paid $1 million for an app that only sent the word "yo". It's almost as bad as back in 2000 when half the superbowl commercials were for fake ibusinesses that didn't actually sell any products.

I don't really care to argue the merits of snapchat or one seemingly very foolish person at your wife's work, that wasn't the point of my comment. I just don't like broad generalizations of an entire generation.

I don't buy into any if those apps either, and I'm not sure on the merits of any of these products or how healthy they are for young people but if people buy/download and use them I guess there is someone exercising their capitalist right.






WhiteTrashCash

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #23 on: August 18, 2019, 08:05:15 AM »
I was with you until the Snapchat comment - settle down grandpa.

The truth is somewhere in the middle - things are different now but really not that bad compared to most generations in human history. Just worse than the last couple by the few measures relating to student loans. 30k in debt isn’t a life sentence but it sure is worse than none.

One of my wife's interns tried to submit their paperwork at work by Snapchat, she told them that it was unacceptable and they would have to submit it in a permanent way by e-mail and they cried to her supervisor about it. Like a baby. The intern was smacked down by the boss for their wimpy ways as well. No sympathy.

Probably about 99.99% of all of these so-called important lifestyle apps are complete bullshit and add nothing to anybody's lives. Meanwhile, all the hipster Silicon Valley angel investors pour their money into this nonsense. Remember when someone paid $1 million for an app that only sent the word "yo". It's almost as bad as back in 2000 when half the superbowl commercials were for fake ibusinesses that didn't actually sell any products.

I don't really care to argue the merits of snapchat or one seemingly very foolish person at your wife's work, that wasn't the point of my comment. I just don't like broad generalizations of an entire generation.

I don't buy into any if those apps either, and I'm not sure on the merits of any of these products or how healthy they are for young people but if people buy/download and use them I guess there is someone exercising their capitalist right.

Yes, their capitalist right to be a dumbass and I'm exercising my 1st amendment right to mock them for being a dumbass. Rights for everybody! Hooray!

Just Joe

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #24 on: August 20, 2019, 05:04:58 PM »
So is email actually harder to use than Snapchat plus going through the trouble to make yourself look like a fool to your supervisor by crying and complaining about following directions? This is on the same level as a 9 year old being told to pick up their shoes and put them in the closet.

Wrenchturner

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #25 on: August 20, 2019, 06:17:38 PM »
So is email actually harder to use than Snapchat plus going through the trouble to make yourself look like a fool to your supervisor by crying and complaining about following directions? This is on the same level as a 9 year old being told to pick up their shoes and put them in the closet.
It should be no wonder that student loans are a problem.  Adult children that grew up in an insular, risk-free environment are at a great disadvantage when the training wheels are forced off.

Goldielocks

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #26 on: August 21, 2019, 12:06:22 PM »
@WhiteTrashCash  --  You seem like a very "eyes wide open" sort of guy, at least about the realities of finances and debt.

How were you able to accumulate $74k in student loans?   I know that your family was unlikely to be co-signers and this exceeds the federal limits, doesn't it?

Can you break it down?   I just helped my daughter apply for her first (government) student loan, and I can't figure out how students with no income / credit manage to borrow more.

therethere

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #27 on: August 21, 2019, 12:15:01 PM »
There's private student loans to cover the rest. I took out nearly 40k in private student loans on top of federal loans. So did my DH. At least when I went to school it was really easy to get however much money you wanted. Parents are used as cosigners. I made it a high priority to refinance them and remove them as cosigners once I had a salaried job.

WhiteTrashCash

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #28 on: August 21, 2019, 02:07:03 PM »
@WhiteTrashCash  --  You seem like a very "eyes wide open" sort of guy, at least about the realities of finances and debt.

How were you able to accumulate $74k in student loans?   I know that your family was unlikely to be co-signers and this exceeds the federal limits, doesn't it?

Can you break it down?   I just helped my daughter apply for her first (government) student loan, and I can't figure out how students with no income / credit manage to borrow more.

I had to take out both subsidized and unsubsidized loans for both my undergraduate and graduate programs. The price tag was actually much higher than $74,000 for the four years of undergrad and two years of grad school I completed, but I was able to pay for some of the amount with a work study program. (I worked in the campus library.) Obviously, I received no help from Parent Loans and my parents refused to co-sign any loans for me. I also had a couple of small private scholarships. The additional certification program I completed a few years ago to retrain for new skills added nothing to the debt because it was covered entirely by a private professional scholarship.

The price tag did increase over time due to the unsubsidized loans, which unfortunately increased the overall repayment amount because I was unable to pay the interest on them while I was in school.

Overall, though, it was completely worth the debt because now my life is pretty good. Before, there was absolutely no hope. Thank God for student loans.

mathlete

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #29 on: August 21, 2019, 02:23:23 PM »
How are boomers screwing their kids?

In the context of this topic? By deprioritizing funding for public higher ed as the job market gets more and more competitive, and instead, asking them to navigate financial waters that they're ill equipped to handle if they want a degree and a shot at competing in that job market.

Is this all the doing of those evil "boomers"? No, certainly not. But the social media posts in the OP are a backlash at the seemingly endless incredulity over why millennials aren't moving out/buying houses/making me grandbabies.

economista

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #30 on: August 21, 2019, 03:47:50 PM »
@WhiteTrashCash  --  You seem like a very "eyes wide open" sort of guy, at least about the realities of finances and debt.

How were you able to accumulate $74k in student loans?   I know that your family was unlikely to be co-signers and this exceeds the federal limits, doesn't it?

Can you break it down?   I just helped my daughter apply for her first (government) student loan, and I can't figure out how students with no income / credit manage to borrow more.

One way to get higher federal loans is to have your parents apply for the parent plus loan and then get denied for it based upon their credit rating. This raises the amount of unsubsidized loans you qualify for by $4000 per year (or at least it was $4000 per year when I wrote my thesis in 2014). Also, the total amount than can be borrowed per year increases year after year, and there isn't a limit for graduate school. I had only federal loans and when I graduated from undergrad I was right around $80,000. Then I went to grad school. However, if I had to do it all again I would, and I would do it all the same way. I consider my education to be worth much more than that and without it I wouldn't have the job I have today.

On a different topic: Something else no one ever seems to consider when this topic comes up is that if you apply credit requirements to borrowers or stop allowing student loans (that one comes up a lot) then you are saying low income students don't have an equal right to higher education and that is fundamentally wrong in my point of view. I come from an extremely low income family that lived below the poverty level. Without student loans I never would've been able to attend college at all. Living at home through school was not an option for me, and I worked 40+ hours a week just to pay rent and living expenses - paying tuition never would've been possible. However, but the government providing loans to me and allowing me to go to college, I now make drastically more than I would've without a college degree and therefore I pay way more in taxes than I every would have. I truly believe higher education should be free (college and tech/trade schools) and yes it would cost taxpayer money, but when the graduates make more money they pay more taxes, which is the part of the equation that always gets ignored by naysayers.

Goldielocks

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #31 on: August 21, 2019, 04:28:17 PM »
@WhiteTrashCash  --  You seem like a very "eyes wide open" sort of guy, at least about the realities of finances and debt.

How were you able to accumulate $74k in student loans?   I know that your family was unlikely to be co-signers and this exceeds the federal limits, doesn't it?

Can you break it down?   I just helped my daughter apply for her first (government) student loan, and I can't figure out how students with no income / credit manage to borrow more.

I had to take out both subsidized and unsubsidized loans for both my undergraduate and graduate programs. The price tag was actually much higher than $74,000 for the four years of undergrad and two years of grad school I completed, but I was able to pay for some of the amount with a work study program. (I worked in the campus library.) Obviously, I received no help from Parent Loans and my parents refused to co-sign any loans for me. I also had a couple of small private scholarships. The additional certification program I completed a few years ago to retrain for new skills added nothing to the debt because it was covered entirely by a private professional scholarship.

The price tag did increase over time due to the unsubsidized loans, which unfortunately increased the overall repayment amount because I was unable to pay the interest on them while I was in school.

Overall, though, it was completely worth the debt because now my life is pretty good. Before, there was absolutely no hope. Thank God for student loans.
Thanks!  That makes sense -- incurred the extra debt based on a thoughtful choice re: Debt vs. Masters...

When you were in your final year of undergrad and making that decision -- do you think that your fellow students around you were equally qualified to understand the consequences of more student loan debt?


Goldielocks

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #32 on: August 21, 2019, 04:39:35 PM »
@WhiteTrashCash  --  You seem like a very "eyes wide open" sort of guy, at least about the realities of finances and debt.

How were you able to accumulate $74k in student loans?   I know that your family was unlikely to be co-signers and this exceeds the federal limits, doesn't it?

Can you break it down?   I just helped my daughter apply for her first (government) student loan, and I can't figure out how students with no income / credit manage to borrow more.

I had only federal loans and when I graduated from undergrad I was right around $80,000.
Yikes!  I just looked up and the current max for federal loans for an undergrad is $57.5k, $45k over the first 4 years, (where parents do not qualify for PLUS loans or the student is independent)....  Did the rules (max) change or how did you get to $80k?

Quote
On a different topic: Something else no one ever seems to consider when this topic comes up is that if you apply credit requirements to borrowers or stop allowing student loans (that one comes up a lot) then you are saying low income students don't have an equal right to higher education and that is fundamentally wrong in my point of view. I come from an extremely low income family that lived below the poverty level. Without student loans I never would've been able to attend college at all. Living at home through school was not an option for me, and I worked 40+ hours a week just to pay rent and living expenses - paying tuition never would've been possible. However, but the government providing loans to me and allowing me to go to college, I now make drastically more than I would've without a college degree and therefore I pay way more in taxes than I every would have. I truly believe higher education should be free (college and tech/trade schools) and yes it would cost taxpayer money, but when the graduates make more money they pay more taxes, which is the part of the equation that always gets ignored by naysayers.

You have a point here, but there is a LOT of scholarship money and subsidy available for students in this position.  There is the option to work for a couple of years, taking part time community college first, to keep the total loan amount down. 

As you indicate, your work barely covered your living expenses...which is totally fair. So wouldn't $12,500/yr in loans cover most in-state tuition costs for an undergrad?   Especially if you qualify for subsidies based on low family income like you say, for the more expensive schools...  ?  I am not saying it is perfect, but I think it is possible to find a way in the current set up.

I will cop to a bias - I am not neutral -- I do believe that many school degrees are too expensive for the return that a person gets, and are actually a luxury item.  And yep, that means that universal access to a more expensive degree is not in my core set of beliefs.   I do think that everyone should have access to fund an undergrad degree.... but that may be one taken at an average college, e.g. $10k/yr tuition or less.

https://trends.collegeboard.org/college-pricing/figures-tables/2018-19-state-tuition-and-fees-public-four-year-institutions-state-and-five-year-percentage
(Be happy if you are not on the East Coast!)
   
« Last Edit: August 21, 2019, 04:52:53 PM by Goldielocks »

economista

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #33 on: August 21, 2019, 05:57:33 PM »
@Goldielocks - I was mistaken - when I went back and looked I had $80k after grad school, but then when the interest on the unsubsidized loans was added in I ended up over $100k - in my mind I kept thinking $80k undergrad and $100k grad school. Although the compounded interest on the maximum that could be taken out probably would’ve put me close to $80k with undergrad alone.

This is such a complicated topic and not all students fall into the general “mold” or statistics. I have my own experience, the experiences of those I know, and the extensive research I have done while in grad school and since then (I studied income inequality, social mobility, and access to higher education). Also - I’m typing this on my iPad so please ignore any typos or formatting issues - it’s hard to preview and edit on here.

In my case I graduated from high school with a 4.0 and the highest ACT score my school had seen in several years. I know that is the case because the guidance counselor called me into his office to go over my scores and told me that was the case. In our school VERY few students went on to college and the teachers were all pushing students to go to a local vocational/tech school or community college. I mentioned to the guidance counselor that I was thinking about doing community college for 2 years then transferring to the state school and he told me that I would be bored out of my mind at the community college and that I was the type of person who needed to be challenged, so he encouraged me to go to the state school right away. That is what I did and for the first semester I lived at home but then my dad took a better job far away and I was on my own to figure out housing and how to live on my own.

At the state school I got the maximum scholarships but the only “free rides” were for athletes. It was a HUGE school where I didn’t get to personally know my professors and the classes were really easy for me. I also worked full time 48 hours a week at a local factory where the overtime was mandatory. At this large state school it usually took students 5-6 years to graduate because it was damn near impossible to get into the classes you needed in the semesters you needed to take them. Due to not getting my classes I needed to be in, I took 2 senior level classes at the beginning of my sophomore year and those classes changed my life. Both professors, separately and unbeknownst to each other, called me into the offices toward the end of the semester and I thought I was in trouble - no other professors had even known I existed before now. In both cases I had written the best term paper of the class so they looked me up, saw that I was an incoming sophomore, and were impressed. They talked to me and found out that I had a 4.0 while working over 40 hours a week and they both gave me the same piece of advice - I needed to get out of that school and go to a more rigorous school where I would be challenged more. One of the professors told me that I was holding myself back by being at that school and that I had to promise him I would investigate other schools.

I wanted to move to Colorado so I investigated schools in Colorado and I decided that I wanted to go to the best program for economics I could get into, and I didn’t care if it was a public or private school, I just wanted to go to the most rigorous, best school I could possibly get into. I ended up at a private school where the tuition was over $50k per year, excluding room and board. They only offered need based scholarships and I received their maximum need-based scholarship, but it was only $35k per year. This school had enrollment levels drastically lower than the state school I had attended, and my ACT score was closer to their average than the state school, where it had been 10-15 points higher. I was challenged. I got 2 Bs and a C my first quarter  mostly from switching to the rigors of a quarter system when I was used to semesters. I also got to know my professors in a way that I never had before. Our classes were much smaller and I truly believe I got a fuller, deeper education because of it.

I chose to stay at that school for grad school and I got a TA position which covered 75% of my tuition and provided me with a stipend. It was luxurious. I was constantly challenged and I’ve never worked so hard in my life. I continued to work outside of the TA position, but I flourished under the hard work. I received the award for the top graduate student in the economics department and I was featured in the university’s magazine as their “student spotlight” for my research. At one point I had a minor panic attack about finding a good job and continuing to pay for school and living expenses and the professor I was talking to told me not to worry. He said that I had impressed him beyond any student before and that for the rest of my life I never needed to worry about having a good job. He would pull any strings necessary and call in any favors possible to make sure I was always employed. I still keep in touch with all of my professors from the economics department. If I had stayed at the state school, I definitely don’t think that would be the case.

So yes, I could’ve done all of this a lot cheaper. I could’ve gone to the community college and passed my classes easily, possibly without loans. I could’ve stayed at the state school and hopefully graduated in 4 years with less loans, but I doubt I would’ve had anyone encouraging me to go to grad school and become an economist. I definitely wouldn’t have made the connections that I have, or have the job that I have today.

On another note, there is one thing I regret - while doing my graduate research I learned about “high-achieving low-income students” which is a category I would’ve fit in. I learned that these students get free tuition at nearly every Ivy League school, and if I had applied to Harvard, Yale, Princeton, etc I would’ve almost certainly got in with a full ride. No one had ever told me that. It was never mentioned to me by my guidance counselor and it’s not something I learned about on my own. My mom didn’t even graduate from high school and I was totally on my own when it came to going to college. I paid for my application fee, I filled out my applications, and I filled out my own FAFSA (after begging my parents for their tax returns every damn year with them arguing about how they didn’t understand why I needed them since I was an adult). Going to college wasn’t even a discussion with them, they never talked to me about any of it, they never asked me questions about it.

economista

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #34 on: August 21, 2019, 06:10:17 PM »
... I cut off the end of my thought....

I was entirely on my own to figure out the college process, how to apply, how to pay for it, etc. I am extremely lucky that I have a high IQ and I am a very self-motivated, high-achieving person. I am outside the average in many ways so I completely understand that while I figured it all out and did it on my own, a lot of other people struggle and wouldn’t be as successful at it as I am. I also have a job where I can make my loan payments and I’m ok, but that doesn’t mean that I don’t have compassion for the people who have a harder time with it. I have degrees in economics and math and a master’s degree in economics. I could work on Wall Street if I wanted to or for a big financial firm and work a ridiculous number of hours for an extremely high salary, and I could pay off my loans in a few years. Instead I chose to have a better work life balance so I work for the federal government  and I made a LOT less than I could in the financial sector. I am enrolled in public service loan forgiveness and an income-based payment plan where I pay $1000 per month on my loans and in another 4 years the balance will be forgiven. I do NOT feel like I am stealing from the tax payers or not upholding my promise to pay back the loans. I am providing benefit to the taxpayers by being a high performer at my agency and working hard at my job. I also make enough money to buy a house, pay $1000 per month on my loans, and allow my husband to be a stay at home dad while still saving. That would not be the case without the education I received.

Goldielocks

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #35 on: August 22, 2019, 01:25:30 AM »
^^ Thanks for the update!  I understand what you are saying, especially about the high school student not always getting all the info they need or people support to make fully informed decisions.   


I was especially interested in the question about the total loans after undergrad, simply because my daughter is starting 3rd year, and there are no other loans that she can get without a co-signer beyond the federal  / govt ones.   That means that she does not have a lot of choices on where to study and if I had not presaved for her, she would have had to work for a couple of years if she wanted (or had to ) live away from home.

FWIW, I absolutely believe in the right of a 22 year old to make decisions that are a big mistake....  BUT 20 and unders should have a  little help from adults close to them to navigate.

Aside :I think we made opposite choices at similar branching points -- e.g., I was very focused on being able to graduate without loans and into a career that paid well after 4 years...   This made me choose a local undergrad where I could get a better scholarship and not the one I really wanted, and a program that could be done in 4 years because it was all "track" based (preset cohort schedules) as I had heard nightmares about getting courses for other degrees, which sucks!!.   Although I had worked up to 32hr/wk in high school, I chose not to work at university in order to graduate faster., taking 7 courses a term, with labs.  I was asked by my professor to join his funded research as a Master's student, (only a couple of competitive openings a year)  and declined, only choosing to get a masters 6 years after graduating.. one that I could work while completing, and choosing cheaper and easier version over prestigious school.....  I chose the super long stressful work hours to make bigger dollars early, and then burnt out and now am mostly FIRED.    Yet all valid intelligent choices for both of us, we are now both on MMM and both enjoying our current lives.

Scandium

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #36 on: August 22, 2019, 08:06:05 AM »
I know the US education system has issues, but I don't quite understand this so-called "student loan crisis". I'll have to dig it back up, but I believe the median student loan balance on graduation is something like $25-30k? That simply does not sound like a lot to me, when calculations from e.g. the Economist says college degree (vs HS only) earns you a million dollars more over a career! That's an amazing deal, great ROI! So if a career is 40 years, that means you make $25,000 more per year than you would not having a college degree, you should be able to pay it off in a few years. Or at least it should not be a "crisis".. If you only get a "high school salary" from a college education that costs thousands why would anyone do it? The market should shut that down. Either the price would be lowered, or nobody would study there. I don't understand how that could continue.

I wasn't very smart in high school, but knew to have some sense of the earnings potential of the jobs I looked at. I didn't do the best choices and did what I wanted and took out more loans than most, at least twice that median, and my parents helped out, but with a MSc in Civil engineering I got a starting salary of almost $70k (and that was over 10 years ago now). Loans weren't really an issue.

So; if you have to borrow $50k+ to earn $25k; don't do it. If you have to borrow $150k to become a lawyer making $200k+ within a few years; well then you'll be ok and I don't really feel sorry for you. This should all sort itself out.

mathlete

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #37 on: August 22, 2019, 09:00:16 AM »
I know the US education system has issues, but I don't quite understand this so-called "student loan crisis". I'll have to dig it back up, but I believe the median student loan balance on graduation is something like $25-30k? That simply does not sound like a lot to me, when calculations from e.g. the Economist says college degree (vs HS only) earns you a million dollars more over a career! That's an amazing deal, great ROI! So if a career is 40 years, that means you make $25,000 more per year than you would not having a college degree, you should be able to pay it off in a few years. Or at least it should not be a "crisis".. If you only get a "high school salary" from a college education that costs thousands why would anyone do it? The market should shut that down. Either the price would be lowered, or nobody would study there. I don't understand how that could continue.

I wasn't very smart in high school, but knew to have some sense of the earnings potential of the jobs I looked at. I didn't do the best choices and did what I wanted and took out more loans than most, at least twice that median, and my parents helped out, but with a MSc in Civil engineering I got a starting salary of almost $70k (and that was over 10 years ago now). Loans weren't really an issue.

So; if you have to borrow $50k+ to earn $25k; don't do it. If you have to borrow $150k to become a lawyer making $200k+ within a few years; well then you'll be ok and I don't really feel sorry for you. This should all sort itself out.

No one makes the decision to borrow money thinking this will be what happens. Replace a college degree with starting a business.

"Why would anyone borrow money to start a business that didn't make money?"

Well if you knew that ahead of time, of course, don't borrow the money. But there's uncertainty in everything. And we provide ways for people to navigate around being crushed by business debt, because it's a good think to make capital available for people who want to start businesses. Sometimes, it doesn't work, and people (business owners, investors, lenders) lose money. But you don't want it to be so punitive that nobody starts businesses unless they're already rich.

It's the same thing with education. Sometimes you study something you think will be worthwhile, but it doesn't pan out and you end up underemployed. Is servicing $25K of student loan debt on a less than stellar salary the worst thing in the world? No, but it's probably a drag on the economy. It would be better if those people were buying homes or having kids instead of servicing debt and pushing family plans off to the future.

WhiteTrashCash

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #38 on: August 22, 2019, 09:08:41 AM »
I know the US education system has issues, but I don't quite understand this so-called "student loan crisis". I'll have to dig it back up, but I believe the median student loan balance on graduation is something like $25-30k? That simply does not sound like a lot to me, when calculations from e.g. the Economist says college degree (vs HS only) earns you a million dollars more over a career! That's an amazing deal, great ROI! So if a career is 40 years, that means you make $25,000 more per year than you would not having a college degree, you should be able to pay it off in a few years. Or at least it should not be a "crisis".. If you only get a "high school salary" from a college education that costs thousands why would anyone do it? The market should shut that down. Either the price would be lowered, or nobody would study there. I don't understand how that could continue.

I wasn't very smart in high school, but knew to have some sense of the earnings potential of the jobs I looked at. I didn't do the best choices and did what I wanted and took out more loans than most, at least twice that median, and my parents helped out, but with a MSc in Civil engineering I got a starting salary of almost $70k (and that was over 10 years ago now). Loans weren't really an issue.

So; if you have to borrow $50k+ to earn $25k; don't do it. If you have to borrow $150k to become a lawyer making $200k+ within a few years; well then you'll be ok and I don't really feel sorry for you. This should all sort itself out.

The people crying about $30,000 in student loans don't have any issue with paying $35,000 to buy a brand new car. Just don't buy the car and pay your student loans. Problem solved.

TheGrimSqueaker

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #39 on: August 22, 2019, 09:36:29 AM »
I know the US education system has issues, but I don't quite understand this so-called "student loan crisis". I'll have to dig it back up, but I believe the median student loan balance on graduation is something like $25-30k? That simply does not sound like a lot to me, when calculations from e.g. the Economist says college degree (vs HS only) earns you a million dollars more over a career! That's an amazing deal, great ROI! So if a career is 40 years, that means you make $25,000 more per year than you would not having a college degree, you should be able to pay it off in a few years. Or at least it should not be a "crisis".. If you only get a "high school salary" from a college education that costs thousands why would anyone do it? The market should shut that down. Either the price would be lowered, or nobody would study there. I don't understand how that could continue.

I wasn't very smart in high school, but knew to have some sense of the earnings potential of the jobs I looked at. I didn't do the best choices and did what I wanted and took out more loans than most, at least twice that median, and my parents helped out, but with a MSc in Civil engineering I got a starting salary of almost $70k (and that was over 10 years ago now). Loans weren't really an issue.

So; if you have to borrow $50k+ to earn $25k; don't do it. If you have to borrow $150k to become a lawyer making $200k+ within a few years; well then you'll be ok and I don't really feel sorry for you. This should all sort itself out.

This is one thing borrowers do need to be told: the loans do have to be repaid. Society does need writers, dancers, and experts in early childhood education however very few can earn a living income in those fields. Sometimes the market is either very competitive and littered with people who are trying or failing... and sometimes the profession is female-dominated and therefore highly regulated or else the pay is extremely low. Therefore, the only time a person should consider an education targeted at those professions is if their family is wealthy enough to pay for it, or if they are "trust fund babies", or if they can swing it out of cash flow with scholarships, or if they are logistically prepared for the difficulties of starting out in life saddled with major debt, or if they are willing to make a living in an area that doesn't involve the profession they're training for. The first three "ifs" generally don't involve taking out student loans in the first place.

Scandium

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #40 on: August 22, 2019, 10:01:27 AM »
No one makes the decision to borrow money thinking this will be what happens. Replace a college degree with starting a business.

"Why would anyone borrow money to start a business that didn't make money?"

Well if you knew that ahead of time, of course, don't borrow the money. But there's uncertainty in everything. And we provide ways for people to navigate around being crushed by business debt, because it's a good think to make capital available for people who want to start businesses. Sometimes, it doesn't work, and people (business owners, investors, lenders) lose money. But you don't want it to be so punitive that nobody starts businesses unless they're already rich.

It's the same thing with education. Sometimes you study something you think will be worthwhile, but it doesn't pan out and you end up underemployed. Is servicing $25K of student loan debt on a less than stellar salary the worst thing in the world? No, but it's probably a drag on the economy. It would be better if those people were buying homes or having kids instead of servicing debt and pushing family plans off to the future.

I don't buy this analogy. Starting a new business is much more uncertain then a college/career. There is plenty of data on earnings of different fields, locations, based on experience level etc etc. I get a salary study from my industry organization every year. How many people with a certain education work in their field, vs say barista, is also published. This data is out there for anyone to look at. And anyone considering college should, why would you not?!

Yes there can be outliers or special events that throw this off, but one can have a pretty good idea what one will earn with job X in location Y. This is not a mystery.

Just Joe

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #41 on: August 26, 2019, 04:19:44 PM »
Honestly, the big problem is that you hear the most about exceptional cases in the media (ex., $150,000 for a Masters in English!) which distracts from the real problem of rent being too high and and salaries being stagnate for the past two decades.

I often wonder about these articles. Are they just trying to generate clicks or are they making smoke and mirrors to hide what you detailed - stagnate salaries.

Travis

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #42 on: August 26, 2019, 06:19:00 PM »
Honestly, the big problem is that you hear the most about exceptional cases in the media (ex., $150,000 for a Masters in English!) which distracts from the real problem of rent being too high and and salaries being stagnate for the past two decades.

I often wonder about these articles. Are they just trying to generate clicks or are they making smoke and mirrors to hide what you detailed - stagnate salaries.

When you focus on the unique case of a six-figure debt for a Bachelor's degree you can focus your ire on the university and the bank.  The author can also frame the discussion to make it look like that case is the norm.  Expanding the discussion to wages and housing means you have to blame whole industries, local and state governments, and business owners large and small.  Nobody wants to read an article that says they might be part of the problem.

Goldielocks

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #43 on: August 27, 2019, 01:53:08 AM »
Statistics2015 reported here that for the 50% of graduating students with student loans, the average loan value was around $25k, and that the majority paid off their student loans within 3 years.  (Yay!  That high interest incentive to pay off is working, I am thinking). 

Student loans for undergrad are harder to get here than in the USA, which may account for the fact that only 50% of students have them.   Or that more people live at home for a year or two if they can.

 The average price for room and board and basic living and tuition for undergrad is assumed to be around $23k per year.   The USA in-state is only about $5k higher.... so the costs are not completely divergent.

I have seen quite a few news reports on the mega student loans, and often the individual just ignored the loan for too long (because they could not pay,  often valid reasons, and they did nothing, and maybe should have started IBR or something).   This is certainly human nature when we are overwhelmed.  Anyway, loans balloon to 3x their original values fairly quickly this way.   Plus of course the out of state extreme tuition pricing and hamstring-cutting blow for people who do not graduate at all.

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #44 on: August 27, 2019, 06:19:58 AM »
I think if you are smart enough to get into university you ought to be smart enough to do a cost/benefit evaluation regarding student loans. Isn't that what the whole "critical thinking" thing is all about?

Travis

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #45 on: August 27, 2019, 06:54:28 AM »
I think if you are smart enough to get into university you ought to be smart enough to do a cost/benefit evaluation regarding student loans. Isn't that what the whole "critical thinking" thing is all about?

I think you may have an incorrect view of what it takes to qualify for four-year degree programs in the United States.

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #46 on: August 27, 2019, 08:06:21 AM »
I know the US education system has issues, but I don't quite understand this so-called "student loan crisis". I'll have to dig it back up, but I believe the median student loan balance on graduation is something like $25-30k? That simply does not sound like a lot to me, when calculations from e.g. the Economist says college degree (vs HS only) earns you a million dollars more over a career! That's an amazing deal, great ROI! So if a career is 40 years, that means you make $25,000 more per year than you would not having a college degree, you should be able to pay it off in a few years. Or at least it should not be a "crisis".. If you only get a "high school salary" from a college education that costs thousands why would anyone do it? The market should shut that down. Either the price would be lowered, or nobody would study there. I don't understand how that could continue.
The median is $17k and $25k for holders of a bachelors degree. Graduate degrees are $45k, but that also includes medical students and lawyers, which have always been expensive degrees to get (source). Those really aren't unreasonable amounts and $25k over ten years is $287.70/month which is manageable, but the average pay between 25 and 34 is  $41,951/year which likely means that graduates right out of school are only making around $35k - 40k, depending upon where they live. Figure they have a take-home pay of 70% of that an you are talking $2,041.67/month to live off of if you make $35k. That's very doable for most people on this site (assume COLA as needed).

However, this is really about student loans plus rent - the average rent in the United States is $1,405/month and the median for a 1br/1ba is typically more than 30% of the gross pay (median rents). So really most early graduates in bigger cities are living with roommates, but even then, lets assume the responsible budget-er - 30% of the gross is going to rent ($875/mo), $287.70 to student loans, about 6% for groceries (~$150/mo, no dining out!), ~$150 for utilities (electric, gas, water, etc.), ~$50 for telecommunications (cellphone and internet), and we are already at ~$1500/mo budget without any retirement savings (likely ~5% to get a 401(k) match), or rainy day savings, let along "fun money" since most people are going to want to do some "fun things" in their mid-twenties. At that point the $2,041.67/mo is gone and that student loan payment ate up about 14% of the net take-home pay. So really the "student loan crisis" for most students is the squeeze due to high rents, lower incomes, and the payment meaning that major milestones (e.g., getting married, living without roommates, having kids, saving for a house, etc.) are being put off until their income starts to go up more. Which means that you stare setting people in their early to mid thirties that are just starting to catch up with where people in their mid to late twenties were back in the 1970's through early 1990's.

Honestly, the big problem is that you hear the most about exceptional cases in the media (ex., $150,000 for a Masters in English!) which distracts from the real problem of rent being too high and and salaries being stagnate for the past two decades.

So you quote the average rent as being $1405, but in your very next link the median national rent is listed as $959 for a 1 BR and $1,190 for a 2 BR (the average clearly should not apply for new graduates, and even the median is stretching it). So assuming these people have a roommate in a 2BR, and all of your other assumptions hold (including 401k savings), you now have at least $600 per month in fun money, or well over a quarter of take-home pay. So really, I'm struggling to understand where the difficulty lies here for the majority of people who simply have not yet learned how to budget.

Davnasty

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #47 on: August 27, 2019, 08:34:39 AM »
I think if you are smart enough to get into university you ought to be smart enough to do a cost/benefit evaluation regarding student loans. Isn't that what the whole "critical thinking" thing is all about?

I think you may have an incorrect view of what it takes to qualify for four-year degree programs in the United States.

Not to mention intelligence in one area doesn't equate to understanding everything.

Even if it was that simple, these aren't just 18 year olds taking in all the information in an unbiased format and making a decision, they're 18 year olds being told by their parents, advisors, teachers, and the media that college = good choice. Then there's all the adults telling you that college was the best experience of their life, wish they could go back. No idea how many times I heard that one.

So the decision comes down to:

a) Do what all the adults are telling me is a good life decision, live on a campus full of attractive people my own age, be able to walk everywhere, play pickup sports on a whim, get drunk on the weekends in a place where it's not frowned upon and relatively safe to do so, have all kinds of cultural events nearby, easy access to various clubs and groups, etc.
OR
b) Get a 40 hour/week entry level job working with mostly older people and continue living with parents or pay my own rent.

Obviously this doesn't cover all the realities but this is probably an accurate representation of the choice for a lot of high school graduates.

Bloop Bloop

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #48 on: August 27, 2019, 04:46:25 PM »
In which case it can't be blamed on the universities, but rather represents a collective failure of the students, their parents, their peers, their teachers, etc.

If you're 18 and you're privileged enough to go to university, you need to take some responsibility for signing on the dotted line.

WhiteTrashCash

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Re: Waah! It's impossible to ever pay off student loan debt! (Article)
« Reply #49 on: August 27, 2019, 06:16:53 PM »
In which case it can't be blamed on the universities, but rather represents a collective failure of the students, their parents, their peers, their teachers, etc.

If you're 18 and you're privileged enough to go to university, you need to take some responsibility for signing on the dotted line.

I read something a while ago where they said that the American public has now decided that people aren't adults until they are 26. Reality is that people are adults when they turn 18 and are legally responsible for themselves. Maybe we should stop babying young people so much and let them handle their own stuff. They'll make some mistakes along the way, but then they can learn the valuable life lessons that everyone learns when they fix their errors.

If they take out $150,000 in student loans and they don't end up as a doctor, then they are just stupid and there is no helping that.