Dreams and Student Loan Debt

What do you want to be when you grow up?  Me?  I don’t know, but I’ll let you know when I do finally grow up….. (imagine a rim shot here).  But seriously, it’s a big question that our kids are thinking about early on in their lives.  As most of us adults know, that will probably change over time, perhaps even mid-college degree.

A poll put out by Fatherly and the New York Times reported the top ten careers that kids want to do.  At the top of the list were doctor and veterinarian.  Great professions.  Very noble work.  A LOT of student loan debt.  After just a quick search online, I found those in each of these careers could VERY easily end up with over $100,000 in student loan debt.

That’s a new house.

Now let me be clear.  I’m not against college degrees.  I’m not even against student loan debt….. if it is done intentionally and responsibly.

Doctors and veterinarians definitely have a good shot at making a very decent income.  In fact, studies tell us that those with college degrees do end up making more money on the average than those with some or no college education.

Graduate KidAnd then there are the outlier degrees that people earn.  Forbes put out a list of the 10 worst college majors based on employment rates and income levels.  Their list includes music, photography, anthropology, philosophy, and history.  These aren’t bad subjects.  Certainly the world is a better place because we do have people contributing to these fields.

Unfortunately, these degrees just don’t tend to pay the bills relative to other majors.

What’s my point here?

Well, I have two.

If you are looking at going to college, do some research about your desired career direction.  Even if you do go into one of those “10 worst degrees”, at least go in knowing what it is going to cost you and what impact that will have on your future lifestyle.  After all, student loans can take as long as 25 years to repay.  What would you like to do in the next 25-30 years and how would a student loan payment impact that?

If you are already in college or beyond, you’ve already got the loans.  At this point, are you aware of your payment options?  Did you know that federal student loans often qualify for repayment programs that could be as low as $0 per month?  If this is what you qualify for, you aren’t going delinquent because you aren’t paying.  That’s just the payment amount the government feels you can afford.  Know what options you have and keep your federal loans in federal programs rather than consolidating into a private loan.  Private loans don’t usually have the same payment options that the federal loans do.

I know I said I have two points, but here’s one more.  If you are headed for or already in college, consider ways to reduce your student loan amounts.  It may take time to find and apply for scholarships.  But if you get that scholarship, figure out how much you got back per hour of time you put into finding and applying.  It’s probably some pretty good income.

Also, consider your work schedule.  At the private university I attended, a friend made it through 4 years of classes with ZERO student loan debt.  He worked a full time-job during both the summer and school year.  He was busy.  He was also debt free after a 4 years of hard work.  4 years is a pretty short term investment compared to 25 years of student loan payments.

If you are struggling with upcoming or existing debt, the counselors at the Center for Financial Resources can help you out.  We can help you find out what loans you have, what your options are, and help you find the best course for your future.  You just need to call us at 605-330-2700 or go online to schedule an appointment.

Follow your dreams.  Just make sure your dreams are well-informed and not just pipe dreams.

 

written by Breck Miller
images courtesy freedigitalphotos.net

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