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Sunday, April 6, 2014

Student Loans

Debt as of 06/09/2012:  $92,645.00

Debt as of 04/06/2014:  $29,926.25

Total debt paid down:  $62,718.75!!!!

Grace & Peace to You,

Whew!  It feels good to be in the twenty thousands, but not even close to what $0.00 is going to feel like.  Thank you everyone who reads this blog and has given us kind words of support along the way!

Today's post is more of a response to a family member of ours from Memphis.  I love these folks and affectionately refer to my in-laws who live in the far west of Tennessee as the “Memphis Mafia” a name taken from Elvis’ inner circle back in the day.  The question she posed was, now that we are quickly approaching $0.00, if given the chance to go back in the past would we borrow money again to pay for school?  So we will try to give our insight on the two dreaded words that affect most of America’s college graduates:  Student Loans!

If you don’t know already, most of our starting debt number was due to student loans.  It’s funny I’m always quick to tell people, “Yeah, we weren’t credit card crazy . . . I mean ours is mostly student loans,” like that somehow makes it OK.  I mean, like we’re better than someone else because our debt has a different name.  Yeah right!  One thing to keep in mind is that no matter what your starting point is you shouldn’t feel ashamed for why you're there.  No one is better than you and debt sucks no matter who you are or what it is.  You should only be ashamed if you have the knowledge to fix it, but don’t do anything about it.

Anyway, back to student loans.  Were our student loans worth it?  Since we were asked that question Emily and I we have tossing it back and forth amongst ourselves over dinners in the house this week.  The following points are what we’ve derived from those conversations:

1.  Borrowing (Student Loans) should be your last resort.  If you are a prospective college student you should literally run down every scholarship, Pell grant, work-study, summer job, etc. you can find, period.  You can pay and work your way through school.  It just takes a little effort.

2.  You don’t have to run out and go to college the first year after you graduate.  Are you ready to go to college?  Some people are and they should go.  Looking back on my days at the Alma mater, I don’t really think I was mature enough to handle college.  Now I’m not saying spend five years wasting time and life, but there is nothing wrong with working and saving for a year to get ready to go to college.  Maybe it takes two years.  Maybe take a couple classes at a time.  Heck, I had a friend who took a year off to work in some abroad program and learned to speak fluent German.  Do you think he regrets taking a year off before hitting higher education?  

If you’re not ready for this major life choice, then don’t enter into it...especially borrowing a ton of money to do it.  You don’t have to jump into the local state school just because “everyone else is doing it and it seems like the what I’m supposed to do.”  Have the confidence to say, “This may be the right choice for other people, but it’s not the right choice for me right now.”  It’s hard to have that kind of confidence at a young age, but I hope you can find earlier than we did.

3.  College is essential.  Now, there is plenty of research out there, as well as common knowledge, that say having a college degree will better prepare you to get a decent job in today’s world. An individual can succeed into today’s world without a college degree.  Some folks have taken that road and done very well, but it is often a much harder road to success.  Success for us is living and working on our own terms.  We’re not quite there yet and we went to college.

4.  Do you really need that degree from Cornell?  Look, lets be realistic. If you didn't earn a major academic or sports scholarship through high school or don't have the financial backing from home, then maybe you shouldn't go $200,000 into debt for an out of state degree you could get at a state school.  Now I'm not trying to crush anyone's dream, but if you didn't knock it out of the park in high school, are you really going to do a 180 and become a young scholar?  Those people are out there, but most of us will fall into our repeated patterns and this time it will cost us.  You need to take a serious look at the following questions:

               Where do you want to attend school and how much would it potentially cost?
               Is it for a specific degree program?
               Is that degree program offered somewhere closer for less?
               Is this degree going to lead to a job that will support you after school? (That’s a big one)
               Could you knock out the first two years at community college for less?
               Are you even ready to go to college?  I mean don't spend $10,000 dollars to go party and play video games for a year.  You could stay at home and accomplish both and save some money.
               Do you even have a plan?  
               And please don't pick your college based on the football team, basketball team, or marching band.  That last one might seem nerdy, but I know people who have done it!  Now if you're a music major and the school has a good music program (plus an awesome marching band) then go for it and get a scholarship!
5.  Lastly, sometimes loans are inevitable.  Again, this should always be a last resort.  The loans we took did help us help us attain the degrees and the jobs we have today.  To answer the question at the beginning of the post, I think we would both answer: Yes, we would have taken the loans again. However, that picture would look a lot different:

• We would not have taken more than we needed.  When we borrowed for our loans, we took way too much and spent recklessly.  It’s scary sometimes how easy it is to take money you don’t have and sink!
• We would have worked in the summers and through college to pay cash for as many things as possible.
• We would have been proactive on chasing down the free money that is available.  Not all scholarships and grants are based on grades!  Scrap for every dollar people.
• We would have attended a school or community college closer to home for 2 years to commute and save money on housing and basic courses that transfer if we needed too.  There is nothing wrong with knocking out basics or living at home right after high school.  You will have plenty of time to live in an apt. or on your own.

Keep paying and saving!

In Christ,
Bryant & Emily