The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: M237 on November 09, 2015, 10:11:06 PM
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I saw this link on my friends FB status.
https://www.reddit.com/r/todayilearned/comments/3rw2nw/til_student_loans_have_passed_credit_cards_and/
It is under reddit's TIL (Today I Learned)
TIL-student loans have passed credit cards and auto loans to become the second biggest source of personal debt in the U.S., trailing only mortgages. The post is 2 days old and has 6k+ comments.
I'll try to summarize it as best as possible. They talk about a lot of different things
- They talk about the education system.
Over-priced tuition. Inflation does not account for the drastic increase in tuition. Professors don't even get paid that much. Administration takes the money or its spent on upkeep. (Some college campuses look SUPER nice) It's nearly impossible to go to college without getting a loan. A lot of degrees are not worth it. Education has been sold as the key to financial freedom and predatory lending was born to poach on those who bought into that dream. Some talked about jobs vs careers. It might be more financially sensible to not go to college. But some jobs are just crappy; over-worked, underpaid and disrespected. - They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford - They talk about other stuff
Young people are struggling to pay off student loans. Hardly anyone is focus on retirement. A whole generation is set up to fail. The generation doesn't even vote, not even at the local level.
There is a debt system that is making slaves out of us. The borrower is a slave to the lender.
I'm about 3/4 of the way through. Overall it has a strange vibe to it. A mix of anger, disappointment, sadness, and despair even.
I use to feel the same way. Back in undergrad I could feel the weight of the financial system bearing down on me. My parents helped with housing and I had to pay for everything else. Busting my butt working for minimum wage totally sucked. My parents told me about the Rat Race. I desperately wanted a way out. I didn't think my college degree would cut it. I thought there has to be some sort of secret. There was all of this talk about 'doing what you love', 'F 9-5, dont be a drone', 'entrepreneurship' and 'passive income'. My parents did the best they could with what they knew, yet I still felt like something was lacking. I just needed someone to show me a way!
Turns out I was lacking the mindset and a few key pointers. Thanks to MMM I found what I needed. (Well and also the wonders and possibility of real estate, but that's another story). In short I'm definitely grateful that I found MMM, his fellow financial freedom bloggers and this forum. Y'all are awesome
Changing someone's perspective is always hard. I'll let MMM and his blogs do that. Afterwards you still need the tools (financial education) and the personal desire to follow through with it. So to help out with the financial education I made a power point (shameless promotion here). I post it on an earlier thread and got a lot of feedback from you guys and friends. I haven't had a chance to update it yet but I will soon!
Other than this, what are your thoughts about the struggle and agonies of the non-Mustachians?
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Here’s my personal anecdote. I’m financially stable because of good education and some innate personality quirks. Yay me!
BUT I’m also one of the umpteen-million chubby American’s currently in existence. Even worse, the fat is in my belly. I’m perfectly aware that I have all the resources I need to be skinnier, and that people judge me for being visibly overweight, and that my life expectancy is shortened, and that my weight is free reign for perfect strangers to lecture me. Yet here I sit, overweight, because I repeatedly fail at emphasizing the long term goal of being lean over the short term pleasure of eating left over halloween candy for lunch.
When I think about people in financial difficulties I really try to remember that every life has it’s agonies, and we could all practice being less judgmental.
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Here’s my personal anecdote. I’m financially stable because of good education and some innate personality quirks. Yay me!
BUT I’m also one of the umpteen-million chubby American’s currently in existence. Even worse, the fat is in my belly. I’m perfectly aware that I have all the resources I need to be skinnier, and that people judge me for being visibly overweight, and that my life expectancy is shortened, and that my weight is free reign for perfect strangers to lecture me. Yet here I sit, overweight, because I repeatedly fail at emphasizing the long term goal of being lean over the short term pleasure of eating left over halloween candy for lunch.
When I think about people in financial difficulties I really try to remember that every life has it’s agonies, and we could all practice being less judgmental.
Very well put... We all struggle with something, but it is so satisfying when you beat your personal struggles. Good luck.
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Here’s my personal anecdote. I’m financially stable because of good education and some innate personality quirks. Yay me!
BUT I’m also one of the umpteen-million chubby American’s currently in existence. Even worse, the fat is in my belly. I’m perfectly aware that I have all the resources I need to be skinnier, and that people judge me for being visibly overweight, and that my life expectancy is shortened, and that my weight is free reign for perfect strangers to lecture me. Yet here I sit, overweight, because I repeatedly fail at emphasizing the long term goal of being lean over the short term pleasure of eating left over halloween candy for lunch.
When I think about people in financial difficulties I really try to remember that every life has it’s agonies, and we could all practice being less judgmental.
Poor processed food readily available, legal drugs, lifestyles built for convenience (cars, delivery, etc), and retail therapy (boosted with insane advertising) make it beyond challenging for people to avoid all of these vices. We are creatures based on habit and instinct. When those instincts are screwed with for profit, the onus may not necessarily fall on the individual. We need to take a hard look at the direction our global society is going, and decide collectively if this is really how we want to live. Immediate gratification vs long term health is really the issue at question.
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My kids both went to community college for their first 2 years and then lived at home and finished up at the local university. We paid for their entire education and my husband and I did not make a lot of money. It can be done. But, too many kids want to go away for college to the most expensive Universities. Unless their parents are willing to pay for it, it should be off the table.
Personally, I don't think kids should be allowed to take out huge student loans for college. Kids under 21 do not make the best decisions about things and then when they do wise up, (if they ever do) they are suddenly saddled with huge amounts of debt.
Parents are not very helpful either about steering their kids into fields that will pay decent money.
Miss Prim
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
Wow. I have never thought of it that way.
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- They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford
Housing in Boston is kind of insane. Still, my biggest annoyance with my rent is that I live a bit further out (not in one of the 'fancy' neighborhoods) and if it rent were lower my SR would go up. If I lived where I want to live...damn, rent would be high!
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
Not to mention that student loans are loans taken out by people with no proven ability to pay them back, no credit rating, no collateral... and they cannot be gotten rid of in a bankruptcy. And a student can pretty much take out unlimited loans, to the low-to-mid six figures. The conditions for lending are unlike any other type of loan.
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
Not to mention that student loans are loans taken out by people with no proven ability to pay them back, no credit rating, no collateral... and they cannot be gotten rid of in a bankruptcy. And a student can pretty much take out unlimited loans, to the low-to-mid six figures. The conditions for lending are unlike any other type of loan.
Also, how many 17 year olds know what their passions really are? I'm sure some do, but I didn't start figuring that out until I was 23-24 (26 now). When I was 17 I felt so much pressure to choose something to do for the rest of my life, and I had no idea what to pick. I also felt very pressured just to go to college and it didn't matter what I did as long as I went. Luckily I liked programming enough to pursue computer science. Other than comp sci I was thinking about doing French as a major. I could have easily fallen into the trap of getting a "passion" degree that I'd have trouble finding a job for (and turns out I'm not actually that passionate about French). It seems that college is sold as something that will make your dreams come true, and is a way to prey on a teenager's naivety. I'm not sure what the answer is, but I feel that some kids would be better served learning a trade if they're unsure of their passions. There's nothing wrong with finding and pursuing your passions later in life.
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College loans are such an awful trap. I see some of the good behind it - but mostly, it's an awful burden. And the worst part of it is - it has now become as acceptable in society as a crushing mortgage. Everyone has one so why worry about it? You see students taking on more and more and more debt...and I bet a huge part of it is because it is so acceptable. At that age, most people just follow "the norm" and figure that if it's normal, that means it is probably manageable.
So few kids sit down and really calculate how much their degree will cost, what type of pay they can expect, and just HOW they are going to pay it all off. I think it's much worse in the US than here in Canada. Yes, I know people in their 40s and 50s still paying off student loans...but I hear of much crazier loans in the US where college is exponentially more expensive.
I was very very blessed - my parents paid for my education. But even back then, I had a practical bent and knew I wasn't going to go to school for a fluff degree. I had REALLY wanted to teach - but in my country, teaching is a miserably paid non-profession. So instead I got my Bachelor of Commerce degree. I ended up staying in Canada and kind of wish I had gotten my teaching degree since it is paid much better here in Canada...but all in all, I am glad I didn't. The job prospects of teachers in my city is miserable. My close friend has been on the substitute list for 6-8 years now.
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My kids both went to community college for their first 2 years and then lived at home and finished up at the local university. We paid for their entire education and my husband and I did not make a lot of money. It can be done. But, too many kids want to go away for college to the most expensive Universities. Unless their parents are willing to pay for it, it should be off the table.
Miss Prim
Are we comfortable with the consequences of this stance as a society? Meaning that college degrees become limited to those whose parents saved for it?
My parents saved $0 for my college education, despite me clearly being college bound my entire life. Plus, since I grew up in a HCOL area and could not live with either of my parents, going to my local community college would have actually been far more expensive than the fancy out-of-state private university that I went to because the fancy place gave me HUGE scholarships. Even with those scholarships, and working during school, I could not have afforded college without some student loan. I would hate
Now the student loan system we have set up is just stupid - the feds give money to any school regardless of how terrible it is (think unaccredited for-profit schools), they aren't dis-chargeable in bankruptcy, and there is no limit on the amount you can borrow. The feds exert no pressure on the schools to keep tuition down.
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Unless their parents are willing to pay for it, it should be off the table.
Miss Prim
If that were the case, I would be back in my hometown right now shoveling pig shit for minimum wage. Not everyone had the same experiences that you and your children have had. Not everyone has parents that can pay for or are even the least bit knowledgeable about these things. Some of us were actively discouraged from even looking at college, let alone given any encouragement, sensible guidance, or let alone money. Grants, student loans, summer jobs, and college work study programs were a godsend to me and to millions of others.
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- They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford
Housing in Boston is kind of insane. Still, my biggest annoyance with my rent is that I live a bit further out (not in one of the 'fancy' neighborhoods) and if it rent were lower my SR would go up. If I lived where I want to live...damn, rent would be high!
Having moved here from NYC back in '06, I thought the prices were eminently reasonable! But I've also seen the value of the condo we bought in '07 skyrocket (25% or more), and hearing from other friends who rent, it does seem like it has gotten pretty pricey. And man, the pace of development here -- holy shit. Everywhere I look there are new buildings going up. The corollary to this is jobs are plentiful and salaries better than average.
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- They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford
Housing in Boston is kind of insane. Still, my biggest annoyance with my rent is that I live a bit further out (not in one of the 'fancy' neighborhoods) and if it rent were lower my SR would go up. If I lived where I want to live...damn, rent would be high!
Sure is! Roommates are a necessity if you want a high savings rate. I currently live with three friends, in part to reduce costs.
If you want to buy in Boston, even a simple 1 or 2 BR condo will start around $300,000. It's unbelievable!
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I have mixed feelings about the increasing amount of student loans people are carrying. My sister and I were both fortunate enough to have parents who encouraged us to think about how practical our degrees might be while we were applying for colleges. As long as we showed we had a plan and kept grades up, they were willing to help pay. I was lucky enough to find out that accounting interested me and was potentially lucrative early on, and had good professors who kept me interested through college. My sister opted for a "soft" degree in music, and had the work ethic and talent to have been a professional flutist if she wanted (still does, imo), but she wanted a little more job security and opted for an educational specialization instead of performance. She still plays in choirs (and on one occasion, a pretty kickass rock and roll band) on the side. Not everyone's passions are that simple to monetize and I think we've both had a fair bit of luck, so in an effort to not be a *completely* elitist ass, I try to sympathize. Ours are the only two cases where I know all the gooey details.
On the other hand, while I was in college I knew plenty of people who took the "passion" degree route and threw caution to the wind regarding student loans. These were people who either 1: had absolutely no idea how big or small their loans were, or 2: didn't care and had no idea how they were going to pay it off. Even before I started spilling the blood of starbucks cups on the MMM altar, I knew this was stupid. Over and over I found otherwise resonably intelligent people displaying reckless disregard for their own futures, which kind of kills the attempt to be sympathetic to some of these same people after they have their 'oh shit' moment.
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- They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford
Housing in Boston is kind of insane. Still, my biggest annoyance with my rent is that I live a bit further out (not in one of the 'fancy' neighborhoods) and if it rent were lower my SR would go up. If I lived where I want to live...damn, rent would be high!
Sure is! Roommates are a necessity if you want a high savings rate. I currently live with three friends, in part to reduce costs.
If you want to buy in Boston, even a simple 1 or 2 BR condo will start around $300,000. It's unbelievable!
Seattle is the west coast equivalent, I think. 2 bed 1 bath starter home is minimum $500k. It's rough.
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- They talk about real estate.
Housing in Boston is insane. All of the normal people are moving away. All the rich folks are buying up houses and all the poor folks have to rent. Eventually the rich will own everything and the poor will have nothing. House prices are too expensive for the average person to afford
Housing in Boston is kind of insane. Still, my biggest annoyance with my rent is that I live a bit further out (not in one of the 'fancy' neighborhoods) and if it rent were lower my SR would go up. If I lived where I want to live...damn, rent would be high!
Sure is! Roommates are a necessity if you want a high savings rate. I currently live with three friends, in part to reduce costs.
If you want to buy in Boston, even a simple 1 or 2 BR condo will start around $300,000. It's unbelievable!
Seattle is the west coast equivalent, I think. 2 bed 1 bath starter home is minimum $500k. It's rough.
It seems $300k is the entry point for any sized starter home in the Boston suburbs. $400k+ if you want good schools and a home that is not in need of substantive work.
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Just this morning a coworker came by and was talking about how they wanted to buy a house, but that it was hard to find a place he could afford. We make a very good amount of money for the area and live in a relatively low housing cost area, so I told him "You should pretty much be able to afford anything in town."
"Not with $500 a month in student loans." Ouch.
Granted, even with $500/mo. in student loans he should have no issues, but I didn't want to lecture him on how he's likely living outside his means.
I feel lucky that neither my wife nor I had student loans. She was able to get scholarships and part time jobs to cover it, and I had the GI Bill and a part time job. I can't imagine having $6-12,000 a month (if we both had loans equal to his) being siphoned out of our paychecks every year. It's not a good excuse though, because that really only amounts to slightly more than an annual IRA contribution.
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Just this morning a coworker came by and was talking about how they wanted to buy a house, but that it was hard to find a place he could afford. We make a very good amount of money for the area and live in a relatively low housing cost area, so I told him "You should pretty much be able to afford anything in town."
"Not with $500 a month in student loans." Ouch.
Granted, even with $500/mo. in student loans he should have no issues, but I didn't want to lecture him on how he's likely living outside his means.
I feel lucky that neither my wife nor I had student loans. She was able to get scholarships and part time jobs to cover it, and I had the GI Bill and a part time job. I can't imagine having $6-12,000 a month (if we both had loans equal to his) being siphoned out of our paychecks every year. It's not a good excuse though, because that really only amounts to slightly more than an annual IRA contribution.
Thankfully I, too, do not have student loans to pay back. Several of my friends have staggering amounts of college loans (to the tune of $1,000/month), and it is crippling. It's like signing up for a mortgage at age 18. Certainly not an impossible-to-surmount roadblock, but it makes even basic financial freedom/flexibility hard to achieve, nevermind FIRE.
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I had about $17k in student loans, which I paid off in a year. I also paid off the parent loans (~$30k) that my Mom took out on my behalf. Now $47k in student loans is by no means a meager amount; however, it's definitely a lot less than what I hear from other people. (Note: This amount would have been either nothing or less than $10k if I had opted to commute ~3 hours/day via public transportation. I don't regret living on/near campus, but I do regret not looking into renting a nearby apartment for much less than the college was charging.) When it came time to choose a grad school, I opted for the free one in LCOL area that was paying me a stipend. Overall, I thoroughly enjoyed my college experience, but have definitely learned from my past choices.
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I'm about 3/4 of the way through. Overall it has a strange vibe to it. A mix of anger, disappointment, sadness, and despair even.
I hear this so much these days. Is it because they spent their youth coddled and sheltered? "What's that you say? Life is hard? Yeah, no guff. Now put on your big girl panties and deal with it." You might want to watch some early 90s interviews with Nirvana fans and ask them if life was unicorns and rainbows. Or British 1970s kids who listened to the Sex Pistols and ask them how prospects for future and joy were. Some things don't change--now go write some good angry songs, sleep on your friend's floor, and drink lots of beer like the rest of us did.
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Seattle is the west coast equivalent, I think. 2 bed 1 bath starter home is minimum $500k. It's rough.
Yes, but the Seattle commuting scene is better. That same house 30 minutes from downtown Seattle is only $200k. Boston seems to have fewer outlying options.
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I'm about 3/4 of the way through. Overall it has a strange vibe to it. A mix of anger, disappointment, sadness, and despair even.
I hear this so much these days. Is it because they spent their youth coddled and sheltered? "What's that you say? Life is hard? Yeah, no guff. Now put on your big girl panties and deal with it." You might want to watch some early 90s interviews with Nirvana fans and ask them if life was unicorns and rainbows.
Yeah no doubt hardships have been in youths to many. For example I had to do mandatory(MUST DO!) military service not that I have something against guns, but it was not fun. I remember one classmate who forgot to come to military enlisting. Finland police went to his home and brutally by force took him to military enlisting. We are neighbors to Russia. You can opt for civil service i.e free worker but military service is shorter and I did military service and it ain't no fun camping in the woods thing.
That said even I recognize my army experience is NOTHING in hardship it did not cost me money or ruin my life.
The system in America is hard you do have less tax in America then Europe, but there is a problem.
Scholarslip: A documentary about the student debt crisis
https://www.youtube.com/watch?v=xFY-PgPA-Uk
Now these students do get my sympathy. I only wonder why not more students literally try to get a sugardaddy or sugarmom from MMM forums... I mean some of them are desperate.
Look I am not an angel in morals, but I do feel sympathy for this problem and I hope it gets better for students in America.
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I remember thinking with horror when I was college-age going to a community college for 2 years, then the "real" college. But for many people that is a better use of their time and money than a traditional 4 year college. It also ticks me off that colleges are spending on so many things that make them look better, but doesn't really improve the education or the college graduate's ability to get a job afterwards. Maybe someone needs to create a mustachian college, that dispenses with huge expensive buildings, landscaping, super expensive room and board plans, also has electives on plumbing, electricity, budgeting, home ec etc. Basically a college when kids get out they are assured to have at least some real world skills.
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At what point does the cost of student debt outweigh the benefits of a degree? Degree inflation has made a degree both mandatory and less valued at the same time. Considering most jobs don't really require a degree, and job growth has been in the low wage sector, being saddled with debt is a lot more worrisome now than before.
Perhaps we should just stop many to all student loans and let colleges lower tuition to what students can afford or go out of business. If you aren't smart enough to get a scholarship or a grant from the Bank of Mom and Dad, then college isn't for you.
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I'm about 3/4 of the way through. Overall it has a strange vibe to it. A mix of anger, disappointment, sadness, and despair even.
I hear this so much these days. Is it because they spent their youth coddled and sheltered? "What's that you say? Life is hard? Yeah, no guff. Now put on your big girl panties and deal with it." You might want to watch some early 90s interviews with Nirvana fans and ask them if life was unicorns and rainbows. Or British 1970s kids who listened to the Sex Pistols and ask them how prospects for future and joy were. Some things don't change--now go write some good angry songs, sleep on your friend's floor, and drink lots of beer like the rest of us did.
Great advice! Graduating into the recession of the early '90s, missing out on the stock market run of the late 20th century because I didn't start saving for retirement until I was out of grad school at almost 30...yeah, I have some gripes. But so does everybody else. It's like one of my sixth-grade teachers said when any of us started acting up: you put your pants on one leg at a time, just like everyone else.
Now drink that beer and quit whining.
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My kids both went to community college for their first 2 years and then lived at home and finished up at the local university. We paid for their entire education and my husband and I did not make a lot of money. It can be done. But, too many kids want to go away for college to the most expensive Universities. Unless their parents are willing to pay for it, it should be off the table.
Personally, I don't think kids should be allowed to take out huge student loans for college. Kids under 21 do not make the best decisions about things and then when they do wise up, (if they ever do) they are suddenly saddled with huge amounts of debt.
Parents are not very helpful either about steering their kids into fields that will pay decent money.
Miss Prim
I totally agree with Miss Prim. All three of my kids started out at community-type colleges and transferred to universities later. Daughter transferred to private university here in PA and because of top grades in community, immediately had her tuition halved. She had some grants as well and ultimately had a stipend to obtain her Ph.D. in science. Older son started out at community and transferred to Temple; he paid his own way by working his butt off at a car dealership full time days while attending full time nights. Hard work, but he did it and ultimately became an attorney. Younger son started out at a state commuter school and transferred to private university, where he also had tuition slashed due to top grades. He was fortunate to have a stepmother by then who paid his tuition. All three kids had some loans, but very small and manageable ones; law school loans were the worst for son #1, but he has paid huge amounts off already, as each time he won a case for his clients, he received a large amount of money, with which he has paid down his loans. Every one of them held paying jobs while they were students and still kept their grades up. I guess you can tell I am really proud of my kids, particularly since I only have an Associates' degree myself and my father did not even graduate from high school.
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As a teen who will enter the college system next year (albeit in Germany), I think one of the main issues I see in my generation is that people feel entitled/don't want to give up on the things they grew up with. Things like a clothes from a second hand shop, an old(read small) tv or a rustbucket car seem like a downgrade compared to what they have now/had as kids. I personally can't wait to go out on my own and become independent though :)
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Seattle is the west coast equivalent, I think. 2 bed 1 bath starter home is minimum $500k. It's rough.
Yes, but the Seattle commuting scene is better. That same house 30 minutes from downtown Seattle is only $200k. Boston seems to have fewer outlying options.
30 minutes or 30 miles?? LOL. Seattle is one of the worst commuting cities in every top 10 list I've ever seen! So time wise you have to quantify it with traffic times - sometimes 30 minutes won't get you out of downtown!
But yes, you are correct, 30 MILES from Seattle, you are golden! Certainly the density of the population is higher on the east cost in that area.
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30 minutes or 30 miles?? LOL. Seattle is one of the worst commuting cities in every top 10 list I've ever seen! So time wise you have to quantify it with traffic times - sometimes 30 minutes won't get you out of downtown!
But yes, you are correct, 30 MILES from Seattle, you are golden! Certainly the density of the population is higher on the east cost in that area.
I think the two are very related. Seattle commuting traffic is worse than average precisely because the gradient in real estate prices is steeper. People will put up with a pretty unpleasant commute to save a quarter million dollars on housing. Even MMM's anti-commuting blog post seems to favor the clown commute around here.
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Unless their parents are willing to pay for it, it should be off the table.
Miss Prim
If that were the case, I would be back in my hometown right now shoveling pig shit for minimum wage. Not everyone had the same experiences that you and your children have had. Not everyone has parents that can pay for or are even the least bit knowledgeable about these things. Some of us were actively discouraged from even looking at college, let alone given any encouragement, sensible guidance, or let alone money. Grants, student loans, summer jobs, and college work study programs were a godsend to me and to millions of others.
I have to say though, that Miss Prim has a point.
I borrowed money for college (some), but most of my education was paid for by my uncle. Uncle Sam, that is. Honestly ROTC and the military academies and the GI bill are a way (if not THE) way that many poor, rural kids go to college.
Most of the problem here was pointed out by someone else - that we let 17 year olds make $100,000 decisions. Really, there should be a "guideline" set out and taught in HS. And maybe limits, like borrowing for a mortgage (Your income/ debt ratio, etc. etc.)
I don't know the answer, but something like:
1. What is your major
2. What is your planned job
3. What is the typical starting salary of your job with your major from your chosen institution
4. What percentage of students graduating get a job in this field.
So, let's say you get an accounting degree from NC State. The average starting salary is $40k a year, and 70% of the students work in the field. That means $40k x 0.7 = $28k.
There, you can borrow $28k. Or $42k. (1.5x)
I know that personally, I didn't know what the hell I was doing signing loan papers. My mother worked at a bank and didnt' either. Nobody in my family had gone to college. I graduated with NO IDEA how much I had borrowed ($11k.) I'm just lucky that I was smart and cheap and conservative, and decided that 5 years in the Navy was a small price to pay for 3 years of tuition paid for at a top-10 engineering school. Damn lucky.
Many kids aren't practical (and they are young), and many parents don't know how to navigate the college funding thing either, because they didn't go through it themselves.
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My niece has three undergrad degrees. One is in art history, one is in English, and I forget what the third is. She works in retail. What a waste that was in terms of remuneration. Kids should have more guidance in choosing their majors. How many are coming out of college with degrees in social work and the like and wind up flipping burgers because their fields are saturated? Ridiculous. They should major in something that will provide them with a means to obtain work that will sustain them; if they are interested in art, it should be a minor for them. They are coming out of college with useless degrees and student loan debt of six figures.
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I honestly don't think anyone who graduated college pre-2008 really understand how bad college education has become. I graduated in 2009 on a free ride so I was fortunate in that regard. But the young people going to college today undoubtily have it worse and it's not their fault.
Tuition has skyrocketed in the last decade. These students have been pushed toward college since they were in grade school. They have been told they were going to college all their lives so it was ingrained in them. Things were different when their parents told them college was their only option; tuition was affordable and jobs were plentiful. Every year tuition has increased significantly since and there are fewer jobs available for recent grads and they pay even less. Schools lured students in with colorful ads boasting about their employment numbers and the "value" of their degrees. You can't entirely fault these young adults, the precedent of how ridiculous it was to pay sticker at a private college wasn't there when most of them enrolled. When people started to realize college had become ridiculously expensive, the colleges presented them with misleading data on the employment prospects of their grads.
I went to a state university for law school and paid sticker. I went at a time when information on the real value of a JD was just becaming mainstream so I chose a cheap school with legit great employment prospects. Even there, my tuition had gone up significantly every year. My first year was 17k, second year was 18.5k, and my final year was 20k. I took less credits for the second two years of law school as well. This year tuition was over 21k and I suspect the trend will continue. I worked throughout law school and still graduated with 50k in student loans. It was worth it for me but at this rate it won't be worth it for new students even at my tier 1 institution because he in-state-tuition is becoming insane. There are real problems with what is happening to our high education institutions and it's not just limited to private for-profit colleges.
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It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
18 year olds can star in a porn movie too getting gangbanged over and over again often done in CA but can't drive 2.5 hours north east to LV to play black jack. no body cares about these folks either. i keep having to remind myself as i watch that pretty thin blonde just out of high school.... it's art.
18 year olds drive tanks and blow shit up in foreign lands yet can't drink a beer at home.
14 years olds can have an abortion without parental consent yet can't see an R rated movie....probably can't have a tooth extracted without parental consent but the baby, no problem.
those are just off the top of my head.
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Another problem is that so many employers will not even consider an applicant unless they have that four-year degree. My husband has a certificate as a medical technologist, and the governing organization for his discipline is pushing hard to require degrees for certification in the future. Ditto in my original field: paralegal studies. I went to certificate programs, but the paralegal society is pushing to require bachelors' degrees. The trouble is those jobs don't pay enough money to justify spending so many thousands of dollars on education. Villanova has a paralegal program, but those graduates don't make more money than the paralegals who went to the community college's certificate programs unless they get hired by the elite firms.
I was promoted from within and although I do not have an accounting degree, I am the controller of the organization. I learned on the job and daresay I am doing fine. There are firms who will not consider a legal assistant who does not have a bachelor's degree.
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Another problem is that so many employers will not even consider an applicant unless they have that four-year degree. My husband has a certificate as a medical technologist, and the governing organization for his discipline is pushing hard to require degrees for certification in the future. Ditto in my original field: paralegal studies. I went to certificate programs, but the paralegal society is pushing to require bachelors' degrees. The trouble is those jobs don't pay enough money to justify spending so many thousands of dollars on education. Villanova has a paralegal program, but those graduates don't make more money than the paralegals who went to the community college's certificate programs unless they get hired by the elite firms.
I was promoted from within and although I do not have an accounting degree, I am the controller of the organization. I learned on the job and daresay I am doing fine. There are firms who will not consider a legal assistant who does not have a bachelor's degree.
and if you ever wanted to get a new job, you would have many fewer options. I work with many people without degrees, and some companies will not even consider you. One guy is mid-50's with 30 years of experience in facilities management, but only about 1/4 of companies would consider hiring him.
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I honestly don't think anyone who graduated college pre-2008 really understand how bad college education has become. I graduated in 2009 on a free ride so I was fortunate in that regard. But the young people going to college today undoubtily have it worse and it's not their fault.
Tuition has skyrocketed in the last decade.
I'd be interested in actual statistics.
Granted, I went to an expensive school. On a whim last year I looked up the tuition. I compared it to the tuition when I attended, and did a little excel magic on it. Tuition has gone up exactly 5% a year since 1988. But it was true back then too. (that's average per year). When I was there it went up by that amount or more, each year. From $12k to $13k to $14k to $15.25k (1988 to 1992).
I think the thing that really harms more recent graduates is the saturation aspect. I've hired many a new engineer who graduated post 2008. They are all doing just fine. But they have engineering degrees.
The percentage and flat numbers of graduates with "any degree" has gone up. So even though jobs like receptionists require a degree (when they didn't before), there is more competition. So there is "debt" without a higher paying job at the other end. Receptionists don't all of a sudden get paid more if they have a degree. Not in my industry.
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Great advice! Graduating into the recession of the early '90s...
Is it because we were such a small chunk of the population (not Boomers or Millennials) that people just don't remember how horrible it was for students and new grads from about '89-93? It's like that recession never happened or something. With that and Iraq War Part 1 underway, it felt like the end of the fucking world. Parents were very much not accepting and not okay with 20-something olds (mostly unemployed with student loans) moving back home to live. Young people communed together like rats--couch-surfing everywhere, pooling money for beer/smokes, making occasional trips to food banks... Recent grads lucky enough to find a job were all doing stuff like waitressing, hotel night clerk, dishwashing, all that fun stuff an unemployed teenager could do. And now I sound like a cranky old man saying, "Back in my day it was bad, blah, blah, blah..," But I'm tired of people saying, "You had it easy, blah, blah, blah..."
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
I know I'm quoting from way far back. But this has always been a sore spot for me and most people fail to recognize how young you are when you are signing up for loans. At that age (esp in middle class suburb america) you have barely made any decisions for yourself yet other than what elective class to take. You decide on the schools you are applying to your junior or very beginning of senior year. At the start of the decision process you're what 16? Most kids can only just get their first job at 16. There's not much of a concept of how much full-time salaries are. So you are 16 and pretty much agreeing to a school and making plans. Then you're 17 when you are signing loan docs, 16 when you are "making the choice" (really following whatever parents or counselors tell you to do and major disappointment if you back out of it).
I was 17 for the first semester of college. Worse than not being able to smoke cigarettes, drink alcohol, or gamble.... I couldn't even DRIVE AFTER 9PM!!!!!! and they let me (and acted like it was no big deal on top of that) take out 100k in loans (50k at 9% interest rate WTF?).
Luckily I did not get a completely useless degree. But I only went to college because that's what was supposed to be next. There was little to no thought about what job I was targeting or what my interests were. To be honest, I had no clue even what engineering was until my 2nd or 3rd year. The system fails because there is zero guidance.
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I just want to clarify some points here that I think are distorting the conversation. First of a 17 year old cannot takeout 100s of thousands of dollars in loans. As per the Federal Student Aid site dependent first year students are limited to $5,500 a year increasing until you are third year and beyond at $7,500 a year. After that then those become private loans that required a co-signer, ie parent, to get the 30-50k first year loan amounts everyone is quoting.
https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized
Second, everyone is quoting what I call the MSRP price of college this is the published tuition rate, there is also what the actual students pay for after all the financial aid and scholarships are applied. This has dramatically gone up as well as the cost of college to a point where some institutions like Harvard, Princeton, and Stanford completely wave the tuition if you make below a certain income.
So yes tuition is going up but so are the financial aid packages and scholarships. Seems like quite a few people on this forum received scholarships or some kind of tuition reduction based on merit. I say that even though there is a form of degree inflation, those that are capable will still be able to get a college education at reasonable prices, because guess what college compete for those students to keep up their rankings.
What is happening now that is new is the greater number of people being convinced that they need to go to college to have a future, without having any idea what to actually study or how much they will actually earn, i.e. for profit colleges or degrees in underwater basket weaving.
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While college is expensive and rising, I know a LOT of students who were using student loan money for far beyond just what's required. I know some that bought vehicles with that money, amongst many other things. I spent the hell out of some money through school. I ended up changing my major several times then leaving and going to a tech school. I left that with a total of 40k in student loans. Had I of been "smart" I would have skipped the other college, not needed a loan for the tech school, and finished 2 years earlier debt free.
Hindsight is always 20/20 of course and when I finished high school I obviously wasn't exactly sure what I wanted to do. My payments were 550/mo til I started knocking out some loans. I ended up paying them off after around 5 years or so.
While my loans pale in comparison to many, it is what it is. I took out the loans, I signed for them (parents co-signed for some) so I made some sacrifices and paid them back. That's life. I'm amazed at the amount of people who think they got some sort of raw-deal. I know it's an unpopular opinion here to hold anyone under 25 accountable for their futures, but I will again resort back to that opinion. Of course, there's the obvious occasional exceptions, but those are the outliers.
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Enjoyable reading material on this general subject: http://professorconfess.blogspot.com/
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9%?!
Sent from my SPH-L720 using Tapatalk
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Unless their parents are willing to pay for it, it should be off the table.
Miss Prim
If that were the case, I would be back in my hometown right now shoveling pig shit for minimum wage. Not everyone had the same experiences that you and your children have had. Not everyone has parents that can pay for or are even the least bit knowledgeable about these things. Some of us were actively discouraged from even looking at college, let alone given any encouragement, sensible guidance, or let alone money. Grants, student loans, summer jobs, and college work study programs were a godsend to me and to millions of others.
I have to say though, that Miss Prim has a point.
I borrowed money for college (some), but most of my education was paid for by my uncle. Uncle Sam, that is. Honestly ROTC and the military academies and the GI bill are a way (if not THE) way that many poor, rural kids go to college.
Most of the problem here was pointed out by someone else - that we let 17 year olds make $100,000 decisions. Really, there should be a "guideline" set out and taught in HS. And maybe limits, like borrowing for a mortgage (Your income/ debt ratio, etc. etc.)
I don't know the answer, but something like:
1. What is your major
2. What is your planned job
3. What is the typical starting salary of your job with your major from your chosen institution
4. What percentage of students graduating get a job in this field.
So, let's say you get an accounting degree from NC State. The average starting salary is $40k a year, and 70% of the students work in the field. That means $40k x 0.7 = $28k.
There, you can borrow $28k. Or $42k. (1.5x)
I know that personally, I didn't know what the hell I was doing signing loan papers. My mother worked at a bank and didnt' either. Nobody in my family had gone to college. I graduated with NO IDEA how much I had borrowed ($11k.) I'm just lucky that I was smart and cheap and conservative, and decided that 5 years in the Navy was a small price to pay for 3 years of tuition paid for at a top-10 engineering school. Damn lucky.
Many kids aren't practical (and they are young), and many parents don't know how to navigate the college funding thing either, because they didn't go through it themselves.
I didn't start college until I was 25. I chose a cheaper state university in my home state (tuition was @$2500/semester back then) because I was paying for it out of pocket. Excelling at that state university not only earned me a full academic scholarship there, but got me into a Top 15 law school (Georgetown), where many of my fellow students were Ivy Leaguers. In this day and age, it really is the way to go. As with anything in life, you get what you put into it.
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I honestly don't think anyone who graduated college pre-2008 really understand how bad college education has become. I graduated in 2009 on a free ride so I was fortunate in that regard. But the young people going to college today undoubtily have it worse and it's not their fault.
Tuition has skyrocketed in the last decade. These students have been pushed toward college since they were in grade school. They have been told they were going to college all their lives so it was ingrained in them. Things were different when their parents told them college was their only option; tuition was affordable and jobs were plentiful. Every year tuition has increased significantly since and there are fewer jobs available for recent grads and they pay even less. Schools lured students in with colorful ads boasting about their employment numbers and the "value" of their degrees. You can't entirely fault these young adults, the precedent of how ridiculous it was to pay sticker at a private college wasn't there when most of them enrolled. When people started to realize college had become ridiculously expensive, the colleges presented them with misleading data on the employment prospects of their grads.
I went to a state university for law school and paid sticker. I went at a time when information on the real value of a JD was just becaming mainstream so I chose a cheap school with legit great employment prospects. Even there, my tuition had gone up significantly every year. My first year was 17k, second year was 18.5k, and my final year was 20k. I took less credits for the second two years of law school as well. This year tuition was over 21k and I suspect the trend will continue. I worked throughout law school and still graduated with 50k in student loans. It was worth it for me but at this rate it won't be worth it for new students even at my tier 1 institution because he in-state-tuition is becoming insane. There are real problems with what is happening to our high education institutions and it's not just limited to private for-profit colleges.
I came out of Georgetown in 1997 with @$75,000 in student loans, and that was with generous grants of around $9k/year. Tuition back then was $21k my first year, and went up each year by a couple grand. Of course, the legal employment picture back then was quite a bit better than it has been for the past decade or so. Bottom line is I don't regret going to law school, even with the debt (still have $15k of it, but at 2.32%, I'm not in any hurry to pay it off, even though I could tomorrow if I wanted to).
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My kids both went to community college for their first 2 years and then lived at home and finished up at the local university. We paid for their entire education and my husband and I did not make a lot of money. It can be done. But, too many kids want to go away for college to the most expensive Universities. Unless their parents are willing to pay for it, it should be off the table.
Personally, I don't think kids should be allowed to take out huge student loans for college. Kids under 21 do not make the best decisions about things and then when they do wise up, (if they ever do) they are suddenly saddled with huge amounts of debt.
Parents are not very helpful either about steering their kids into fields that will pay decent money.
Miss Prim
I think some people misunderstood what I was trying to say. I was talking about kids who could go to a state university but WANT to go to a private college that cost 4 times what the state university would cost. That is what I meant by it should be off the table. I would never have paid for some of our expensive private colleges for my kids unless they had full scholarships or were willing to wait and save up money by working. By the way, they also held jobs while going to college as we made them pay for their books. I think it means more to students if they have something invested in their education.
What I didn't mean was that if parents aren't willing to pay for college at all or can't, that someone shouldn't go. In those cases, student loans, scholarships and working are the only options, but I think student loans should be kept to a minimum. Sorry if I offended anyone who had to struggle to get through college with no help from parents. That was not my intention.
Miss Prim
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"Back in my day it was bad, blah, blah, blah..," But I'm tired of people saying, "You had it easy, blah, blah, blah..."
Fine you had a tough youth. We believe you. However it is still worse today and you fail to see it.
The system in America is hard you do have less tax in America then Europe, but there is a problem with study fees.
Scholarslip: A documentary about the student debt crisis
https://www.youtube.com/watch?v=xFY-PgPA-Uk
Now these students do get my sympathy. I only wonder why not more students literally try to get a sugardaddy or sugarmom from MMM forums... I mean some of them are desperate.
Look I am not an angel in morals, but I do feel sympathy for this problem and I hope it gets better for students in America.
Miss Prim you sound like a nice and wise parent, but unfortunately some students do not have wealthy parents or get abandonden by parents.
The horror stories are those that get so big debt and they never manage to pay it off. Another typical horror story is that they get their degree, but for rest of their lives work at some fast food place or something else that has nothing to do with their studies.
Coldly said perhaps you should make prostitution legal it would help some students and I am from Europe with prostitution legal country.
Now that is not what I wish that students use desperately prostitution, but how to fix the root of problem that is difficult. It is not the governments fault and it is not the parents fault it is those greedy teaching places.
Question could USA convert to say typical Europe model? Yes in theory, but that would require lots of law changes and a big budget support from the government. The whole process would be very complicated and I am not expert enough to evaluate how that could possibly be done. On the other hand you have lower tax in USA and world is grey there is no perfect country.
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I honestly don't think anyone who graduated college pre-2008 really understand how bad college education has become. I graduated in 2009 on a free ride so I was fortunate in that regard. But the young people going to college today undoubtily have it worse and it's not their fault.
Tuition has skyrocketed in the last decade.
I'd be interested in actual statistics.
Granted, I went to an expensive school. On a whim last year I looked up the tuition. I compared it to the tuition when I attended, and did a little excel magic on it. Tuition has gone up exactly 5% a year since 1988. But it was true back then too. (that's average per year). When I was there it went up by that amount or more, each year. From $12k to $13k to $14k to $15.25k (1988 to 1992).
I graduated in college in 1985. My tuition was $1000 a year. If tuition had only been raised according to the rate of inflation, (I used the inflation calculator at dollartimes.com) tuition at that institution would now be $2229. Instead it is over $7000.
Went to graduate school for a few years, and finally finished in 1993. My total undergraduate and graduate school loans were $23000. According to the same inflation calculator, that amount in today's dollars is $38000.
I feel very lucky that I paid off my student loans in 4 years, and have been debt-free ever since. It would have been much harder if I had been paying today's inflated tuition/fees/administrative costs.
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I went to university and left with a loan a little under $40k, initially the time I paid $500/month for repayment (it decreased with time). It delayed my path to home ownership, investing etc. However it also allowed me a chance to break the cycle of poverty, being poor sucks more than paying off loans. I'm a fan of Canada's Student Loan program.
Some people buy lottery tickets, I bet my loan money on education. Its a shame not everyone's experience is positive, there always will be an element of personal responsibility for life's choices.
I remember despairing when I was 17 that I was screwed in life (relative to my classmates). Initially I was unaware of loans and lined up work doing manual labour after high school, I almost left early because there wasn't much point in finishing I thought. I skipped a few days of school to pick up work, I needed cash more than biology. I wasn't looking forward to 40 years of labour so I did finish high school, overall high school is pretty fun and work generally was not. When I got my loans it gave me an opportunity to succeed, it never guaranteed I would though. I realized I always had the labour job as a fall back, it was motivation to not fail.
Although loans are a burden what would the majority of peoples lives be like if they hadn't received those loans? How many doctors, engineers, teachers and other professionals would be doing manual labour because they never had the opportunity for University? Although the first few years after school are tough (low wages as a junior employee) how does that compare with lifelong expectations? One of my fears with the current loan crisis is it will cause exceptionally gifted students to not pursue advanced degrees as doctors etc., all this pessimism might have made me reconsider.
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Coldly said perhaps you should make prostitution legal it would help some students and I am from Europe with prostitution legal country.
Now that is not what I wish that students use desperately prostitution, but how to fix the root of problem that is difficult. It is not the governments fault and it is not the parents fault it is those greedy teaching places.
Landlord2015, I've seen a lot of non-sequitur posts from you lately. Every time I read something and think "What? How is that related to the topic?" it seems to be one of your posts. And for some reason you always bring up prostitution and how it is legal in your country (Finland?). Most of your post is very apposite but please think for a moment before your post about whether you are actually replying to the topic or just getting one of your hobby horses out (prostitution, rental income, taxes...).
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The student loan "problem" is a joke. The average is about 30k...that isn't really a life altering amount of money. Pick up a second job for a couple years and cut back some luxury items for a while and you can get that paid back no problem. If you are crushed by 30k in debt so bad you can't ever get out and you have a college degree...congrats, you obviously picked a less than worthless degree. I know way too many people that want to complain about their student loan payments but somehow manage to afford a new car, a 100+ dollar a month data plan for their 500 dollar smart phone, and have money for a fancy vacation every year, etc.
The handful of people I do know that got buried for an amount well over that 30k average all fell for the same basic traps. The first and most obvious was opting to go to a ridiculously expensive school. If you got buried for 100k+ because you had to live at a fancy private college you get no sympathy from me, because 100k was more than I paid for 2 degrees done commuting to a community college and state college. Sure I wasn't a financial wiz at 18, but I knew enough to know the difference in price between commuting to community/state college and living at a fancy college would work out to almost being enough to buy a house with after 4 years. They also borrowed more money than they actually needed, and used the difference to pay for cars and vacations. I know one person that borrowed and extra 8k one semester for a car, and now wants to cry endlessly about her 70k in student loans...its insane! The thing all these types of people have in common is if they didn't get buried in student loans, they'd have got buried by some other kind of loan because they obviously lack any financial common sense at all. They are the same types of people that end up in credit card debt, buying a house they really can't afford, taking 6 year loans out for cars and only care about the monthly payment even though they are paying for the car twice over, etc. If anything they should be ecstatic they are buried in student debt that is preventing them from taking on other higher interest forms of debt.
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Most of your post is very apposite but please think for a moment before your post about whether you are actually replying to the topic or just getting one of your hobby horses out (prostitution, rental income, taxes...).
Yes I do think before I post. However prostitution, rental income, taxes
are not hobby horses for the people who do it. I don't mean to be evil or try to insult you or other people.
It is about MONEY. Rental income is a hobby? What?! Landlord or Landlady is not a fun hobby.
Hobby is for example that I do sports and also play Magic The Gathering.
https://en.wikipedia.org/wiki/Magic:_The_Gathering
Magic the Gathering that is hobby true, but I have sold for 10k euro MTG cards this year 2015 so again it has to do with money.
Moving on...
What joke is this? Where is the info that 30 000$ is average student loan? Even if it would be true they might count those who do not take any loan.
I have heard about loans like 100 000$+ and that is very much money. Sure if you get that good or super job then you can pay if off, but not all get a good job.
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What joke is this? Where is the info that 30 000$ is average student loan? Even if it would be true they might count those who do not take any loan.
I have heard about loans like 100 000$+ and that is very much money. Sure if you get that good or super job then you can pay if off, but not all get a good job.
google it, its true
http://money.cnn.com/2013/12/04/pf/college/student-loan-debt/index.html
http://www.fool.com/investing/general/2015/01/24/the-average-american-owes-this-much-in-student-loa.aspx
http://www.huffingtonpost.com/2014/11/19/student-debt-map_n_6168396.html
There are tons of sources all giving relatively close figures depending how exactly they derive their data. People in the hole for 100,000+ are the extremes, and I'd be willing to bet most of the people 100,000+ in the hole don't complain a whole lot about it because they end up as doctors, lawyers, etc and paying it back isn't an issue. I have a relative that had 250k in student loans when she finished up, but she's a doctor now and making 200k+ a year so its not a big deal for her...its just the ones that end up 100k+ in the hole that got there because they went to a super expensive school and got a bachelors in a low paying field that want to cry.
Plus...THEY SHOULD COUNT THOSE THAT DON'T TAKE LOANS. Isn't that what an average is? You take the total amount of loan money, divide it by the total number of students enrolled. I busted my butt to pay my way through college...why should I not count towards the average, but if I had one semester I came up short and borrowed 1000 bucks...then I'd count? How would that make any sense.
Here is another pretty awesome source. The data is 2012 so its a couple years dated, but it has a table ranking your debt load by percentiles.
http://www.frugalfringe.com/numbers-crunching/compare-your-student-loan-debt-to-national-studies-whats-your-percentile/
If you have 100k or more in student loans, congrats, you compromise one of the 4.6%. If you have 30k or less are part of the 75%. Every time I've read an article about one of those poor souls buried in six figures of student loan debts its always a joke how many bad choices they made in life, generally a super expensive college and a degree in a low paying field among other things, when the reality is the majority of college grad are still finishing with an amount of student debt approximately equal to buying a new car or less...hardly a life altering amount of money if they are willing to make a few cuts to other areas of their life, and as a mustachian I'm sure you'd agree a lot of people waste a lot of money on extra things they really don't need so for the average person to trim their budget a bit its definitely possible.
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You do have facts that back up your information.
Thats said how about that take a Master Degree
say 6-7 years University.
I can tell you why the loans are not bigger. Because
really many parents sava money for their childrens education.
There are ways to make money of course work part time and study
but, those who do not have parents that pay for anything
are often in bad position regading how big the loan can grow.
I am saying why the loan is so little for many are that parents back them up
financially.
Here is one main budget worry for many parents in USA: How can I save enough money for the childrens studies?
You obviously are wealthy and I am not even near poor for sure. That
said how about those parents that have say many children
that want to study?
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I can tell you why the loans are not bigger. Because
really many parents sava money for their childrens education.
There are ways to make money of course work part time and study
but, those who do not have parents that pay for anything
are often in bad position regading how big the loan can grow.
I am saying why the loan is so little for many are that parents back them up
financially.
Here is one main budget worry for many parents in USA: How can I save enough money for the childrens studies?
I disagree. I just graduated 3 years ago. My last year of taking classes I could enroll full time at the local community college for less than 3k a semester. Classes at the closest state school were roughly 6k for a full time semester. Of course, that's commuting. You are talking 12k for an associates and 24k for the bachelors...or roughly 36k spread out over 4 years and you could have your bachelors. If you commute and work, and actually throw some money at school instead of wasting it on dumb stuff, its very possible to come in with less than 30k debt with no help from parents.(other than a free bedroom and dinner on occasion, which I suspect an overwhelming majority of parent's won't mind supplying when they see their kid working hard and trying to do well for himself)
Or just do what I did...I spread 2 degrees out over 10 years while working two part time jobs, and eventually one full time job averaging probably 30k during those years. I bought a condo instead of throwing money away at a dorm. Between writing off my tuition and mortgage interest I was getting decent tax returns those years, and at the end of 10 years I had equity in a home and was debt free...where as most the people who opted to go live somewhere on credit for 4 years were in much worse shape than I. There are plenty of ways do avoid student debt that don't involve mom and dad, its just that they generally don't involve living on campus either.
I'm not denying some people luck out and have parents that pay for a good chunk of their schooling but my point is if you view college as what it is, a path to a better career, and don't get caught up in the hype of the college experience and wanting to live on campus at a fancy college and party and not work for 4 years, its not hard to make it through with no, or well below the average debt without help form anyone.
You obviously are wealthy and I am not even near poor for sure. That
said how about those parents that have say many children that want to study?
I'm not wealthy, my parent's didn't pay for any of my college, they made too much for me to qualify for any sort of aid, and I'm not a minority or a single mother so I didn't qualify for any easy to grab grants. They told me when I was young, I better get scholarships if I want to go to college. I screwed around in highschool and didn't get any scholarships, so I had to work extra hard to make up for it later on. I had plenty of days where I was up at 3am to get ready for work and didn't get to bed until 11pm because I had to drive home after my night class got out at 10pm. At 28 I ended up with an associates and a bachelors fully paid for, and that was even taking a few semesters off to avoid total burn out or I could have done it faster. Refer to above numbers...36k / 10 = 3.6k per year. That's not exactly an impossible amount for someone to come up with.
In the end it was a trade off. It really sucked missing out on much of the "college experience." I missed lot's of parties and and fun, but in the long run it put me in a much better position financially for the sacrifices I made, and any one of the morons who dug themselves into massive debt could have chose a cheaper school and made some of those exact same sacrifices but they chose not to.
If people want to have many kids, and want them all to attend college, do you know what they should tell them? Exactly what my parent's told me, if you want to go to college, better get scholarships. Its not a parent's job to cough up a boat load of cash so their kid can go live on campus somewhere and not work for 4 years. The kids can take a non-traditional path like I did, or simply work nights and weekends and commute to minimize their debt load, or they always have the option of going in the military or getting into a trade...neither of those are bad options. The average pay of trades these days is higher than most college grads make anyhow...I know where I work the welders and carpenters are making more than the engineers. I also know plenty of electricians and plumbers, and most of them make more than the average nurse or teacher. Of course the work is a little more manual and the schedule might be more hectic, but its still a good living. The idea that everyone needs to go to college is simply ridiculous, especially with the amount of kids coming out with joke degrees. As a society we have a need for a certain amount of unskilled/uneducated labor, we don't really need people with degrees doing these jobs, it just serves no purpose. If I had a son that at 18 said he wanted to be a welder or a carpenter I'd high five him for being smart with the way things are these days, not push him to apply to 60k a year schools so he can go have the "college experience."
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SirFrugal I have to give congratulations for your personal success. Very nice that you have a degree student debt payed off and top of it a condo and the mortgage debt for the condo payed off.
I do know about frugal. In my country it does really NOT cost much to study but taxes are high though for an investment apartments interest you get full tax refund in my country Finland(Europe) but landlord tax is 30% but tax is calculated and you can deduct some running costs inlcuding water fee from income before they tax the gross income.
I know these forum is full of frugal posters. I have read about one dude that somehow(sounds like a fairytale) negotiated 0,1% interest with a bank.
Well here is my achievment. I started seriously saving for an apartment at 18 years age(during study time I did work even with physical labor work whatever to EARN money at least during summers when study places in Europe take a break) and paid of (though small apartment in capitol area) my first mortgage in less then 4 years! This despite me not having good or super salary that I read many have on these forums. I had finished my 4 year engineer studies and also done my military service which took less then 1 year before paying of the first mortgage loan.
Today I rent 3 apartments in the capitol area.
You wanna talk frugal with me? I have never owned a car despite me having a driving license, but cars and fuel is more expensive in my country while bus or metro is decent price.
I did waste much money on buying Magic The Gathering cards, but I was fortunate in the last decade+ the prices have gone up so I have earned thousands of euro due to this.
Sure I am not extreme frugal I do enjoy good Hollywood movies in the cinema pay for an expensive gym and make holidays and even those not every year holiday. My hotel or flights are usually not expensive(2 star hotel is good enough for me), but I can spend lots of money during my holiday sure I can have date with a lady in a nice restaurant as I did have in Kiev Ukraine.
About Ukraine and Kiev culture this music descibes it:
New Ukrainian Music Жаклин feat Тамерлан - Купи мне любовь
https://www.youtube.com/watch?v=V1qBesZA8kU&feature=player_embedded (https://www.youtube.com/watch?v=V1qBesZA8kU&feature=player_embedded)
Moral police should not go there lol the Ukraine mob is in Kiev, but they don't kill tourists unless you are an idiot and make trouble. A warning the police force in Kiev is not your friend avoid them if they show a street is blocked then you don't go there!
Ukraine is not my favorite country to visit I enjoy more south Europe beaches electronic music including vocal trance, house and other electronic music etc and maybe I will visit middle Europe Germany for 5 stars clubs if you get my meaning:
https://www.youtube.com/watch?v=K4hUias4kls (https://www.youtube.com/watch?v=K4hUias4kls)
I believe I have maken my point clear that I can use lots of money though I really tend not to drink much alcohol that is not my style, but yeah slightly booze, but never to drunk specially if in another country.
My point being SirFrugal I respect your achievment we are many good frugal posters here. That said these 3 example people struggle despite working and despite schoolarship they struggle:
Scholarslip: A documentary about the student debt crisis
https://www.youtube.com/watch?v=xFY-PgPA-Uk
You are absolutely right about that we don't need so many students and that physical labor is underestimated in income. However while I am talented at computers I really suck if I would try a car repair and my talent does not lie withing building houses despite me being a landlord.
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First off, congrats to all you hardworking people that came out of school with no loans. But PLEASE stop acting high and mighty because you had people guiding you in your youth.
Secondly, not all people who came out with crazy high in student loans are lazy/dumb people with stupid degrees, that spend all their money on vacations and fancy crap. So please stop spreading this bull. Yes, some people did that. But others did not and they still end up in the same position. I worked 2-3 jobs in the summer. Lived in an off campus apartment with poor heat and no car. Worked part time and later full time through school. I went on no vacations, ate boxed mac and cheese or ramen, no cable, no entertainment spending money (maybe a 12 pack of natty light on the weekends?), no fancy electronics, I think you get the point...
I graduated with around 80k in loans from undergraduate. I did compare tuition slightly at the time and the school started out not much higher than other colleges I applied to when considering aid. But let's see how this can easily stack up. Numbers are slightly falsified but should prove the point (tuition annual increase percentages are correct). Please don't nitpick the exact numbers this is just an example.
First year - Tuition is not that much more than other universities when considering financial aid. 12k in loans taken out. 40k tuition.
2nd year - SURPRISE tuition goes up 7%. Aid stays the same. Move off campus to shitty $350/month apartment with poor heat and open wiring. Work part time all year in school, no car to get jobs off campus. Work 2-3 jobs over the summer to save up money. Tuition increases to 42800. Aid stays the same. 14800 in loans taken out, 750 in interest accumulated.
3rd year - SURPRISE tuition goes up another 5%. Aid stays the same. Realize college is expensive but talk to admissions. None of the credits are transferable thanks to the "unique" amount of credits per course and alternative schedule in place of semesters. If you leave now, you have to start from the near beginning at another college..... Tuition increases to 45500, aid stays the same. 17350 in loans to take out + 3350 in interest accumulated on loans.
4th year - Almost there. Tuition increases 8% to 49000. Aid stays the same. 21000 in loans taken out plus 6250 interest. Everything else above remains the same. Work 40 hours in internship that you have to drive 1hr each way to.
Total Costs
Yr 1 - 12,750
Yr2 - 16,550
Yr3 - 20,715
Yr4 - 27,275
Total = 77,275!!!!
So yeah, a school that doesn't look so bad when you agree to go. Balloons out of control very quickly.... Yes, I went to an expensive engineering school. I did get a good job out of college. I even skipped graduation so I could start full time work within 1 week of completing my coursework. I did work jobs throughout school. I did not go on fancy pants vacations or buy the newest whatever. I was not 21 until halfway through senior year so I did not waste all my money at bars. Tuition increases and interest accumulated on loans accounted for almost 30k of my loans.
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<snip>
4th year - Almost there. Tuition increases 8% to 49000. Aid stays the same. 21000 in loans taken out plus 6250 interest. Everything else above remains the same. Work 40 hours in internship that you have to drive 1hr each way to.
<snip?
Holy shit! Tuition alone was $49K?? What were your entire expenses for that last year of school? By the time you add in books, rent, food, etc. it must have been insane. Congrats on doing it all while racking up just $77K in loans. Seriously. Well done. I'm sure your degree landed you a pretty lucrative job so I suspect you'll have the loans paid off asap.
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http://forum.mrmoneymustache.com/antimustachian-wall-of-shame-and-comedy/hard-to-feel-sorry-for-these-people/
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First off, congrats to all you hardworking people that came out of school with no loans. But PLEASE stop acting high and mighty because you had people guiding you in your youth.
Oh yeah me and SirFrugal are proud people to some degree. That said nether of us are millionaires(at least not yet) if you really wanna be envious on people there are tons of millionaires out there in the world.
I do feel sympathy toward those who have student or study loans.
SofaKing while your post is informative and good link to interesting stories thread I don't agree with you. Shameful? Shameful is if yor for example do hard crime example murder or rape.
True not all those decisions what they have done are wise and what is odd I think is those horrible interest rates that some pay for their loans. Example 7-9% loan interest rate?!
Please also stop saying this is YOUNG peoples problem.
Read this story(not mine I have no study debt and I am from Europe).
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I was fortunate enough to have parents who paid my tuition in undergrad. The deal was I would work to support myself and they would pay for the classes. I worked 40 hours a week as a server at Old Chicago and made it out debt-free. My degree was in Psychology and so I was anxious to get out into the world and help people and contribute to the community. I would stay up every night working on cover letters and resumes, researching open positions, and networking through family friends but even with a Bachelors degree I really struggled to find a job where I felt as though I was contributing to the community in a way that matched up with my gifts and skills. It felt like I had the same employment opportunities after my degree as I did before. I kept working as a server and filled my free time with unpaid internships in domestic violence shelters, youth programs, and religious organizations. After working with homeless youth at Urban Peak for several months I decided to earn my Master of Divinity and pursue ordination in The United Methodist denomination. Although I received a scholarship that eliminated half of my tuition costs, I still graduated with $75,000 in student loans. Then I married a fellow seminarian who had undergrad and graduate student loan debt. The combination of our student loan debt eleven years after graduating from seminary is over 250k. I am an ordained United Methodist Clergy working in Denver, Colorado and my husband serves at a church in Littleton, Colorado. We have a beautiful 7 year old daughter with special needs and a sweet dog named Tracey. While we don't make a lot, I do feel like we make enough if it wasn't for our student debt. A family friend had researched the Student Loan Forgiveness Program for us and for awhile we were on that track until a footnote was added to the legislation disqualifying us from participating due to our professions being religious in nature. I understand the motive behind the exclusion but I also feel saddened by it. As a United Methodist pastor I see my role and the role of my congregation doing so much good in the community without expectation or even mention of conversion. I have felt a lot of shame for the debt we carry and our inability to pay it back. Sometimes I cry because its so overwhelming and I can't get a hold of it. I think about changing careers because maybe in a corporate job I could make more. I know what I do matters more than the money I make but I also have a desire to be able to contribute and to pay back all my loans it's just not possible and really is hopeless. We will never own a home or pay off our loans but I am proud that we will make a difference in this world and in the lives of people who have had a tragedy or feel lost or unloved. We will feed the hungry and cloth the cold and listen to the lonely because we are Christians, not because they are or aren't. At the end of the day, I remind myself of the ways I do contribute to this world and I ask for grace in the midst of falling short on the expectation that we will ever be out from underneath all we borrowed to get us there.
"
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The combination of our student loan debt eleven years after graduating from seminary is over 250k.
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What is even more horrible is that due to religious work they were neglected the forgiveness. I would understand if neglected for some other reasons or simply denied, but saying since you have religion that is wrong. Another proof that Evil atheism and Satanism is growing though I don't mean atheists are satanists.
Look I am certainly not even near Saint myself(and I have done military service and would be willing to kill in case of war), but I do believe in God and Jesus. Evil in movies i.e for example Horror or Action or in music can be cool, but in real life not nice.
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Great advice! Graduating into the recession of the early '90s...
Is it because we were such a small chunk of the population (not Boomers or Millennials) that people just don't remember how horrible it was for students and new grads from about '89-93? It's like that recession never happened or something. With that and Iraq War Part 1 underway, it felt like the end of the fucking world. Parents were very much not accepting and not okay with 20-something olds (mostly unemployed with student loans) moving back home to live. Young people communed together like rats--couch-surfing everywhere, pooling money for beer/smokes, making occasional trips to food banks... Recent grads lucky enough to find a job were all doing stuff like waitressing, hotel night clerk, dishwashing, all that fun stuff an unemployed teenager could do. And now I sound like a cranky old man saying, "Back in my day it was bad, blah, blah, blah..," But I'm tired of people saying, "You had it easy, blah, blah, blah..."
I graduated high school in 93. That was the year both of my parents got layed off. It was hard for me as a teen to find a job because those McJobs that usually went to teens were being taken by seniors.
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I graduated a state university in 1997 with a $17k loan. I managed to pay for college via grants (parents were unemployed my first year), scholarship, work study and loans. It took me 5 years and living at home to pay off my student loans.
I chose the school based on my ability to pay back the loans. That is a crock that these 18 year old kids shouldn't be allowed to take out loans.
From my observation, the reasons why they are so in over their heads is:
Went to "designer universities"
Used their loan money for parties, cars, shopping sprees, Spring Break & etc., fancy apartments
Majored in studies that would gain jobs in low paying careers aka passion majors
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I graduated a state university in 1997 with a $17k loan. I managed to pay for college via grants (parents were unemployed my first year), scholarship, work study and loans. It took me 5 years and living at home to pay off my student loans.
I chose the school based on my ability to pay back the loans. That is a crock that these 18 year old kids shouldn't be allowed to take out loans.
From my observation, the reasons why they are so in over their heads is:
Went to "designer universities"
Used their loan money for parties, cars, shopping sprees, Spring Break & etc., fancy apartments
Majored in studies that would gain jobs in low paying careers aka passion majors
Thanks for sharing your experience. I graduated high school in 2002, and college in 2010 and again in 2012, and I can assure you that your observations are accurate. I watched people do those very things you say, which is why the thought of bailing out college loans absolutely disgusts me. Even post graduation, I've yet to stumble across someone who can't afford to pay back their student loans who doesn't have a smart phone with a data package, and the reality is if they shut it off they could save 100 bucks a month, and 100 bucks a month thrown at the principal of your student loans could shave years off the payback time, and that is just one small sacrifice they could make to get debt free. I also know plenty that want to have their own apartment even though a room mate could save a few hundred a month, and who go take out car loans soon as they graduate, because hey, they deserve it, right?
Somebody is going to have to pay for it...and I'd rather have it be the people who signed on the dotted line, who in many cases refuse to make any sacrifices at all to pay their debts, rather than it becoming a burden of the tax payers, which in many cases is people like you and I who made our sacrifices and paid our dues already.
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I graduated a state university in 1997 with a $17k loan. I managed to pay for college via grants (parents were unemployed my first year), scholarship, work study and loans. It took me 5 years and living at home to pay off my student loans.
I chose the school based on my ability to pay back the loans. That is a crock that these 18 year old kids shouldn't be allowed to take out loans.
From my observation, the reasons why they are so in over their heads is:
Went to "designer universities"
Used their loan money for parties, cars, shopping sprees, Spring Break & etc., fancy apartments
Majored in studies that would gain jobs in low paying careers aka passion majors
Thanks for sharing your experience. I graduated high school in 2002, and college in 2010 and again in 2012, and I can assure you that your observations are accurate. I watched people do those very things you say, which is why the thought of bailing out college loans absolutely disgusts me. Even post graduation, I've yet to stumble across someone who can't afford to pay back their student loans who doesn't have a smart phone with a data package, and the reality is if they shut it off they could save 100 bucks a month, and 100 bucks a month thrown at the principal of your student loans could shave years off the payback time, and that is just one small sacrifice they could make to get debt free. I also know plenty that want to have their own apartment even though a room mate could save a few hundred a month, and who go take out car loans soon as they graduate, because hey, they deserve it, right?
Somebody is going to have to pay for it...and I'd rather have it be the people who signed on the dotted line, who in many cases refuse to make any sacrifices at all to pay their debts, rather than it becoming a burden of the tax payers, which in many cases is people like you and I who made our sacrifices and paid our dues already.
+1
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First off, congrats to all you hardworking people that came out of school with no loans. But PLEASE stop acting high and mighty because you had people guiding you in your youth.
Secondly, not all people who came out with crazy high in student loans are lazy/dumb people with stupid degrees, that spend all their money on vacations and fancy crap. So please stop spreading this bull. Yes, some people did that. But others did not and they still end up in the same position. I worked 2-3 jobs in the summer. Lived in an off campus apartment with poor heat and no car. Worked part time and later full time through school. I went on no vacations, ate boxed mac and cheese or ramen, no cable, no entertainment spending money (maybe a 12 pack of natty light on the weekends?), no fancy electronics, I think you get the point...
I graduated with around 80k in loans from undergraduate. I did compare tuition slightly at the time and the school started out not much higher than other colleges I applied to when considering aid. But let's see how this can easily stack up. Numbers are slightly falsified but should prove the point (tuition annual increase percentages are correct). Please don't nitpick the exact numbers this is just an example.
First year - Tuition is not that much more than other universities when considering financial aid. 12k in loans taken out. 40k tuition.
2nd year - SURPRISE tuition goes up 7%. Aid stays the same. Move off campus to shitty $350/month apartment with poor heat and open wiring. Work part time all year in school, no car to get jobs off campus. Work 2-3 jobs over the summer to save up money. Tuition increases to 42800. Aid stays the same. 14800 in loans taken out, 750 in interest accumulated.
3rd year - SURPRISE tuition goes up another 5%. Aid stays the same. Realize college is expensive but talk to admissions. None of the credits are transferable thanks to the "unique" amount of credits per course and alternative schedule in place of semesters. If you leave now, you have to start from the near beginning at another college..... Tuition increases to 45500, aid stays the same. 17350 in loans to take out + 3350 in interest accumulated on loans.
4th year - Almost there. Tuition increases 8% to 49000. Aid stays the same. 21000 in loans taken out plus 6250 interest. Everything else above remains the same. Work 40 hours in internship that you have to drive 1hr each way to.
Total Costs
Yr 1 - 12,750
Yr2 - 16,550
Yr3 - 20,715
Yr4 - 27,275
Total = 77,275!!!!
So yeah, a school that doesn't look so bad when you agree to go. Balloons out of control very quickly.... Yes, I went to an expensive engineering school. I did get a good job out of college. I even skipped graduation so I could start full time work within 1 week of completing my coursework. I did work jobs throughout school. I did not go on fancy pants vacations or buy the newest whatever. I was not 21 until halfway through senior year so I did not waste all my money at bars. Tuition increases and interest accumulated on loans accounted for almost 30k of my loans.
Bro you still went to a school charging 40k a year for tuition alone. I'm not feeling bad for you when I commuted to a community college because it was costing me less than 1/10th of that, even at 18 I knew the different between 40k and 4k. State colleges here are around 1/4 of that. You could have done it a lot cheaper if you chose a different school...but grats on at least getting a marketable degree with good job prospects!
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My kids both went to community college for their first 2 years and then lived at home and finished up at the local university. We paid for their entire education and my husband and I did not make a lot of money. It can be done. But, too many kids want to go away for college to the most expensive Universities. Unless their parents are willing to pay for it, it should be off the table.
Personally, I don't think kids should be allowed to take out huge student loans for college. Kids under 21 do not make the best decisions about things and then when they do wise up, (if they ever do) they are suddenly saddled with huge amounts of debt.
Parents are not very helpful either about steering their kids into fields that will pay decent money.
Miss Prim
This is interesting because I whisper this to my kids while they sleep. My husband says "no way, they need to go away for college". (Because we did.) But you know, we both were on ROTC scholarships.
Anyway, at this point we can pay cash for wherever our kids want to go. That doesn't mean I'd rather steer them towards in-state schools, vs. Cornell, for example.
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Great advice! Graduating into the recession of the early '90s...
Is it because we were such a small chunk of the population (not Boomers or Millennials) that people just don't remember how horrible it was for students and new grads from about '89-93? It's like that recession never happened or something. With that and Iraq War Part 1 underway, it felt like the end of the fucking world. Parents were very much not accepting and not okay with 20-something olds (mostly unemployed with student loans) moving back home to live. Young people communed together like rats--couch-surfing everywhere, pooling money for beer/smokes, making occasional trips to food banks... Recent grads lucky enough to find a job were all doing stuff like waitressing, hotel night clerk, dishwashing, all that fun stuff an unemployed teenager could do. And now I sound like a cranky old man saying, "Back in my day it was bad, blah, blah, blah..," But I'm tired of people saying, "You had it easy, blah, blah, blah..."
Yes! So I graduated in 1992 and went into the Navy. In '92, in my area (Chemical engineering), people were just fine on the job front.
But one of my sorority sisters majored in math and graduated in '91. She spent a year temping. We ended up rooming together in DC, but it took her more than a year to get a full time, non-temp job. And by then she was competing with new grads.
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This is interesting because I whisper this to my kids while they sleep. My husband says "no way, they need to go away for college". (Because we did.) But you know, we both were on ROTC scholarships.
Anyway, at this point we can pay cash for wherever our kids want to go. That doesn't mean I'd rather steer them towards in-state schools, vs. Cornell, for example.
I had a friend who had parent's that will pretty loaded...I'd be surprised if they were worth less than 5 million by 60. When we graduated high school his parent's told him "We saved xxx dollars for you to go to college. You can go to whatever school you want. If there is anything left when you finish your bachelors degree it is yours to keep."
He chose to commute to a state school and pocket the remainder. I thought they were insane for doing that at the time, but looking back at it now I realize it was actually pure brilliance. What better way to have your kid not want to go to an over priced college and giving him a head start in life than to basically give him incentive to go to a more affordable college and make him think it was his idea.
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Choosing a fancy school can be part vanity and the crowd of friends and girlfriends..
Have I ever done a vanity thing? Buying in year 2014 an apartment built in 2014 that is my vanity treat. Tired of saying my old apartment needs that repair.
Being landlord is party vanity but... here as I see it in my country since you can not get huge study debts and good social benefits if you are a renter and on't own any real estate or have big savings or stock or other investment those are
LOWER MIDDLE CLASS in my country.
LOWER class is very rare in my country, but yeah a drug addict that uses all the money to drugs and can thus even risk of not eating enough food is lower class in my country.
In my mind to be upper class in my country you need to be millionaire as assets-liabilities > 1000 000 euro.
What class are the 1% in USA? Lets not go there those are the unrealistic goal to achieve for the forummembers.
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Ok posting on topic...
These documentary is slightly old:
The College Conspiracy Full Documentary
https://www.youtube.com/watch?v=DAV17Li1pkM (https://www.youtube.com/watch?v=DAV17Li1pkM)
but if today tuition can cost 40k+
Stop saying you can not go to private school. This is a problem in USA though you still have low tax.
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This is interesting because I whisper this to my kids while they sleep. My husband says "no way, they need to go away for college". (Because we did.) But you know, we both were on ROTC scholarships.
Anyway, at this point we can pay cash for wherever our kids want to go. That doesn't mean I'd rather steer them towards in-state schools, vs. Cornell, for example.
I had a friend who had parent's that will pretty loaded...I'd be surprised if they were worth less than 5 million by 60. When we graduated high school his parent's told him "We saved xxx dollars for you to go to college. You can go to whatever school you want. If there is anything left when you finish your bachelors degree it is yours to keep."
He chose to commute to a state school and pocket the remainder. I thought they were insane for doing that at the time, but looking back at it now I realize it was actually pure brilliance. What better way to have your kid not want to go to an over priced college and giving him a head start in life than to basically give him incentive to go to a more affordable college and make him think it was his idea.
Some of my husband's family friends did the same. They both chose a state school (in a different state, but one that allowed you to get in-state tuition after a year).
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
That IS a good way to look at it.
If that were the case, I would be back in my hometown right now shoveling pig shit for minimum wage. Not everyone had the same experiences that you and your children have had. Not everyone has parents that can pay for or are even the least bit knowledgeable about these things. Some of us were actively discouraged from even looking at college, let alone given any encouragement, sensible guidance, or let alone money. Grants, student loans, summer jobs, and college work study programs were a godsend to me and to millions of others.
And I'd be your co-worker. Your co-shoveler. However, I didn't borrow. Being uncertain that tomorrow would be better than today /being uncertain that my ability to pay would be better tomorrow, I was always afraid (rightfully so) of borrowing. I didn't finish in four years, I worked more than was healthy, and I lived in dangerous places, but I made it through college in spite of -- as you say -- being actively discouraged from higher education.
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I just want to clarify some points here that I think are distorting the conversation. First of a 17 year old cannot takeout 100s of thousands of dollars in loans. As per the Federal Student Aid site dependent first year students are limited to $5,500 a year increasing until you are third year and beyond at $7,500 a year. After that then those become private loans that required a co-signer, ie parent, to get the 30-50k first year loan amounts everyone is quoting.
https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized
That's assuming one's parents can get PLUS loans. Not all parents can, nor does every student fall into the 'dependent' student category. The borrowing limits for 'independent' students are higher. Factor in capitalized interest on unsubsidised loans while the student is in school, and an 'independent' 4-year undergrad student who borrows the subsidized and unsubsidised max can graduate with almost $50k of debt. And should our hypothetical graduate have to use his deferment or forbearance options, interest continues to capitalize, not just on his subsidized loans, but on his unsubsidised loans now as well.
And as you said, that's just the federal loans.
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It's no wonder that student loan debt is out of control. We're asking people to make the biggest financial decision of their lives at the age of 17! Of course they're going to screw it up.
It boggles the mind that you have to be 21 to play a $5 hand of blackjack in Vegas, but a 17 year old can strap on $100,000 of student loan debt and nobody seems to care.
That IS a good way to look at it.
If that were the case, I would be back in my hometown right now shoveling pig shit for minimum wage. Not everyone had the same experiences that you and your children have had. Not everyone has parents that can pay for or are even the least bit knowledgeable about these things. Some of us were actively discouraged from even looking at college, let alone given any encouragement, sensible guidance, or let alone money. Grants, student loans, summer jobs, and college work study programs were a godsend to me and to millions of others.
And I'd be your co-worker. Your co-shoveler. However, I didn't borrow. Being uncertain that tomorrow would be better than today /being uncertain that my ability to pay would be better tomorrow, I was always afraid (rightfully so) of borrowing. I didn't finish in four years, I worked more than was healthy, and I lived in dangerous places, but I made it through college in spite of -- as you say -- being actively discouraged from higher education.
Shovering pig shit? I don't do that bad work but it is a bitter smile that I have!
IT career SUCKS in Finland. I am engineer in IT(data-communication) and I work part time and it ain't IT!
I am in Marketing&Sales with a merciless cruel boss. My boss usually fires new recruits in less then 2 weeks!
My wage? It is ok and not minimum salary and I need the money... it is more then that doing enough part time work exactly 26 weeks of minimum 18+ hours works does reboot your good social unemployment benefit unless you drop to low unemployment benefit which is HORRIBLE.
Fortunately for me whole year 2016 I will not drop to that state and if I reboot before that the countdown starts from 0. Wonderful system if you manage to get at least part time work!
The system in Finland works smartly having part time work is 100 times better then no work!
Oh if you count landlording I have 2 part time workplaces.
I am doing fine though this is my 18th/26 week and it would not matter if I would get fired I would take another job in 2016 and then the first week in that job would be 19/26.
Oddly I seem to have a talent for marketing&sales.
You can joke all you want, but I don't smile when I mention my work and my merciless boss.
Funny you mentioned PIGS... my mentor JEDI MASTER an expert teacher for entreprenurs said to me I have 4 options:
A. Move abroad where you can find realistically good IT workplace.
B. Become an entreprenur! I did start an entreprenur course on Tuesday this week which is held 2 evenings/week. I know personally the teacher from before.
C. Continue what I do... do part time work and buy more investment apartments i.e rental income!
D. Do become a PIG have so much passive income that you never need to do work... this term used my JEDI MASTER entrepreneur teacher since he consider it the lazy way. He did not insult with it more meant as teasing and yeah only a minority considers this group as pigs.
D option is realistic for me in future, but not yet. I want very high lifestyle and not some frugal life!
D PIG here has no limit when it comes to booze or hookers i.e the Roman orgie every weekend way IF that is the pigs wishes ,but it is subjective what expenisve wish people have. The PIG is not some frugal or environmentalist that a minority of forum members seem to be about.
Being frugal is ok while trying become wealthy. However in PIG state that time should be over and in the past!
Let me explain a PIG female might buy that expensive jewelery costing 20k-50k. I am not meaing hording jewelery like a millionaire that wants to spend big time, but crystal clear wealthy for sure.
What might I buy as PIG? To many times sex mentioned right?
Well a Ferrari is darn cool car for sure! That said problem is a new Ferrari is huge cost 240 000-330 000$.
Well I am a gamer but lately I haver used frugally and old computer.
I would buy top end Intel SKYLAKE CPU and excellent NVIDIA graphic card and 16 GB RAM if becoming pig today!
The list goes on I don't mean to buy every wish. but at last some wishes though that Ferrari is super expensive.
On the other hand I have seen a Ferrari on the motorway and it was darn fast you can not compare that to a normal car!
Perhaps that is why I don't own a car despite having driving license. Since I like to drive really fast and I am not fond of mediocre cars.
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This is interesting because I whisper this to my kids while they sleep. My husband says "no way, they need to go away for college". (Because we did.) But you know, we both were on ROTC scholarships.
Anyway, at this point we can pay cash for wherever our kids want to go. That doesn't mean I'd rather steer them towards in-state schools, vs. Cornell, for example.
I had a friend who had parent's that will pretty loaded...I'd be surprised if they were worth less than 5 million by 60. When we graduated high school his parent's told him "We saved xxx dollars for you to go to college. You can go to whatever school you want. If there is anything left when you finish your bachelors degree it is yours to keep."
He chose to commute to a state school and pocket the remainder. I thought they were insane for doing that at the time, but looking back at it now I realize it was actually pure brilliance. What better way to have your kid not want to go to an over priced college and giving him a head start in life than to basically give him incentive to go to a more affordable college and make him think it was his idea.
Some of my husband's family friends did the same. They both chose a state school (in a different state, but one that allowed you to get in-state tuition after a year).
Smart families. Much smarter than, say, the ones around here who pressured their kids to accept a 3/4 or full-tuition scholarship to a local university in exchange for a new car.
Starting in the mid-late '90s, some states flush with revenue began offering very generous merit-based scholarships to any in-state high school graduate with a GPA of 3.5, give or take. Great idea on the surface, but plenty of parents undermined any future mustachianism in their offspring by dangling those car keys. Locals referred to it as the "BMW scholarship."
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As parents, DH and I always told our kids that we'd pay for one of the two state universities or the equivalent amount. As the kids approached high school, we made sure to let them know that they could go out of state but only if they closed the gap between the actual cost and what we were willing to pay with merit money, not loans.
We've been really lucky- both of our kids are high achievers. The oldest has taken 7 college classes for a total of 45 transferable credits (quarter) as well as a bunch of dual enrollment credits that may or may not transfer. He's a senior this year - straight A student and has taken more math in high school then dh and I had to take to get our engineering degrees. He's also done two summer research internships. It's paid off so far - one university that he's targeted for his intended major has offered him a four year full tuition scholarship, regardless of what major he ends up in. That's at least $120k total for four years that we don't pay but really it's just a $60k savings for us.
There's no way he should start at a community college. He can go away for four years for about $10k/year. (He's also in the running for a full ride from that university, so our actual costs could end up being a few plane tickets back and forth.)
I think this is the first year where our state high school graduates can attend community college for two years virtually free. No way am I going to send my kid there, because he already has cleared quite a few starter classes. It isn't worth it because I'd likely have to shell out the full cost of a state school for the last two years- and that's roughly $40k right there.
I may be buying him an MMM-approved car with the savings upon graduation from college. Seems somewhat fair. We still keep a big portion of $ that we intended to spend.