Author Topic: The student loan bubble  (Read 831 times)

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Offline Phoenix87x

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The student loan bubble
« on: August 06, 2017, 11:16:08 AM »
So I recently just graduated and am finally working full time and am about to finally move out on my own. Very luckily, my job makes it doable to make payments on my student loans + living costs like rent and bills and what not.

But running the numbers in preparation has been very sobering on how much life costs, even when you are single with no kids.

All I can think about is "wow, if my job wasn't 6 figures, I would be screwed". And hearing more and more about recent grads ending up working at Target or Applebees or whatever, I have to to wonder, what will the endgame be when people are sitting on 50K + in student loans and no way to pay for either the loans or a mortgage/rent. 

Thoughts?
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Offline KevShmev

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Re: The student loan bubble
« Reply #1 on: August 06, 2017, 11:56:31 AM »
My thought is I will be paying my student loans off till I am dead and buried.  :censored  At this point, I just write the check for $170 every month, mail it, and don't stress it.  It is what it is.

Offline Ben_Jamin

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Re: The student loan bubble
« Reply #2 on: August 06, 2017, 12:06:14 PM »
It is frustrating how They tell you go to school and be something. Yet, if you do it puts you in a worse position unless the job is high paying and those aren't always available. It puts people off from going thinking they'll just be better off not having that degree and working their way up.

Its just a really messed up system that I don't understand.
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Offline Adami

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Re: The student loan bubble
« Reply #3 on: August 06, 2017, 12:09:47 PM »
And more and more, a lot of fields require higher education in order to succeed.

I was very very fortunate to have inherited money and put myself through college and two MA programs without debt.

Now, to be a psychologist, you need a doctorate (in America at least), and by the time I graduate with it, I'll have over 120,000 dollars in debt. Psychology is not a high paying job either unless you get really lucky or take years to build up something.

It feels like the message is to not go to school and instead learn a trade to be a laborer of sorts so that the people who can afford school can be your boss.
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Offline eric42434224

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Re: The student loan bubble
« Reply #4 on: August 06, 2017, 12:49:15 PM »
I will be making my FINAL student loan payment this Oct.   :metal
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Offline Adami

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Re: The student loan bubble
« Reply #5 on: August 06, 2017, 01:05:30 PM »
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Offline Cool Chris

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Re: The student loan bubble
« Reply #6 on: August 06, 2017, 02:15:22 PM »
And more and more, a lot of fields require higher education in order to succeed.

We should clarify the difference between fields requiring a college degree, and employers insisting on seeing one on a resume. Lots of people are in jobs that they could perform at a high level without their degree, if their resume would have passed the initial screening process. Employers are just in a position to be more discerning on who they hire.
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Offline SystematicThought

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Re: The student loan bubble
« Reply #7 on: August 06, 2017, 03:01:56 PM »
I graduated in May 2016 and have quite a bit of debt to repay. I've worked at my family's grocery store for years, so have a decent amount of savings that I can use for car payments, gas and food. Luckily my parents are cool with me staying at home for now and don't charge me rent or anything. I still work at my parent's grocery store but that gets me about $3000 a month, and most of it goes to student loans. People have a heart attack when I mention how much debt I have, but at the rate I'm going, it'll be paid off in about 4 years. Of course, that's if everything goes to plan
« Last Edit: August 06, 2017, 03:07:46 PM by SystematicThought »
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Offline pogoowner

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Re: The student loan bubble
« Reply #8 on: August 06, 2017, 06:33:57 PM »
It's tough. I'm sitting on a good amount of debt and I didn't even finish my degree. That's my own fault, and I accept it. I just wish I had heard more when I was growing up about alternatives to 4-year colleges. But I got very good grades in high school, so it was always assumed that I would go. It's really rough for those people whose parents make just enough money to basically deny them financial aid, but who aren't in a financial position to really help their children with school.

Offline SystematicThought

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Re: The student loan bubble
« Reply #9 on: August 06, 2017, 10:42:02 PM »
I think that's the part that really sucks. Yeah, my parents make more than a lot of others do, but we don't have money laying around to go to a $40,000 university. I always hated filling out FAFSA every year because I knew I wasn't going to get anything.
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Online portnoy311

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Re: The student loan bubble
« Reply #10 on: August 07, 2017, 12:39:12 AM »
The other thing is how much worse prices have gotten compared to previous generations. I have many relatives who were able to put themselves through college at universities like Cornell and U of Michigan, by working normal unskilled labor positions. Now that won't even let you pay for a semester, much less put a roof over your head and feed yourself. It genuinely has gotten worse, astronomocally worse for the younger generation.

Offline TheOutlawXanadu

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Re: The student loan bubble
« Reply #11 on: August 07, 2017, 06:28:51 AM »
Another issue with student loans is that prospective college students aren't educated well enough on how the loans work, how ridiculous they can get, and on strategies to reduce debt. That's not to say that all the responsibility falls on one's high school - kids need to take the time to research for themselves - but I would have loved a day-long workshop on the subject when I was a senior in high school. It certainly wouldn't have hurt.
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Offline Stadler

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Re: The student loan bubble
« Reply #12 on: August 07, 2017, 08:51:00 AM »
It is frustrating how They tell you go to school and be something. Yet, if you do it puts you in a worse position unless the job is high paying and those aren't always available. It puts people off from going thinking they'll just be better off not having that degree and working their way up.

Its just a really messed up system that I don't understand.


The real problem is thinking there is a "They" that is telling you ANYTHING (and you listening to it).   You have to make the decision that is right for you.  My son - a success in every sense of the word, as far as I am concerned - decided he wanted to work on cars.  College is not the best route for that, so he went to a trade school, then after working for a couple years, joined the Army to work on helicopters.  With that, he will be as prepared for any job in his trade, as I am for a job in the legal field.  Moreso, perhaps.

What we've really done is get confused between what we NEED and what is NICE TO HAVE.  We've been brainwashed that our "passions!" are important or that are all you need.  I have zero sympathy for someone that racks up $200k in student loans to learn basket weaving and is baffled that the world isn't beating down their door for baskets.

I don't mean this to be a screed; I do have tremendous sympathy for someone who has put in the effort and the plan just hasn't materialized.  I get that, and it sucks.   But we have to break ourselves of this notion that we are not responsible for our decisions, or that we are just one vote away from having all our problems taken away.   The student loan "bubble" is in a lot of ways the same as the "credit card bubble" and the "housing bubble", and for the same reasons.   Who's fault is it that you chose the $500k house instead of the $250k house, just because some mortgage guy (whose commission is based on the loan amount) told you you could? 

Offline Stadler

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Re: The student loan bubble
« Reply #13 on: August 07, 2017, 08:55:27 AM »
Another issue with student loans is that prospective college students aren't educated well enough on how the loans work, how ridiculous they can get, and on strategies to reduce debt. That's not to say that all the responsibility falls on one's high school - kids need to take the time to research for themselves - but I would have loved a day-long workshop on the subject when I was a senior in high school. It certainly wouldn't have hurt.

I would go further than that; student loans, yes, but car loans.  Checking accounts.   Mortgages.  Even day-to-day utility bills.   Yes, it's the person's responsibility, but that's not to say we shouldn't offer ways - easier ways - of helping those people MEET their responsibilities.

Offline El Barto

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Re: The student loan bubble
« Reply #14 on: August 07, 2017, 09:02:27 AM »
It is frustrating how They tell you go to school and be something. Yet, if you do it puts you in a worse position unless the job is high paying and those aren't always available. It puts people off from going thinking they'll just be better off not having that degree and working their way up.

Its just a really messed up system that I don't understand.


The real problem is thinking there is a "They" that is telling you ANYTHING (and you listening to it).   You have to make the decision that is right for you.  My son - a success in every sense of the word, as far as I am concerned - decided he wanted to work on cars.  College is not the best route for that, so he went to a trade school, then after working for a couple years, joined the Army to work on helicopters.  With that, he will be as prepared for any job in his trade, as I am for a job in the legal field.  Moreso, perhaps.

What we've really done is get confused between what we NEED and what is NICE TO HAVE.  We've been brainwashed that our "passions!" are important or that are all you need.  I have zero sympathy for someone that racks up $200k in student loans to learn basket weaving and is baffled that the world isn't beating down their door for baskets.

I don't mean this to be a screed; I do have tremendous sympathy for someone who has put in the effort and the plan just hasn't materialized.  I get that, and it sucks.   But we have to break ourselves of this notion that we are not responsible for our decisions, or that we are just one vote away from having all our problems taken away.   The student loan "bubble" is in a lot of ways the same as the "credit card bubble" and the "housing bubble", and for the same reasons.   Who's fault is it that you chose the $500k house instead of the $250k house, just because some mortgage guy (whose commission is based on the loan amount) told you you could? 
So at what point does it become exploitative? If I go in to buy a Hyundai and the car salesman talks me into buying a Maserati (with the undercarriage coating and Scotchguarding) everybody will be pleased as punch to say it's my own fault for being a sucker. Is that really all that matters? What if I'm 66 years old and just coming to grips with my retirement? What if I have the IQ of a 11 year old? Howabout credit card companies that'll give cards to 18 year old knuckleheads once they graduate high school? Is it always the kid's fault when he becomes 12000 in debt?

Personally, I'm not crazy about a world where caveat emptor is the prevailing way of life.
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Offline bosk1

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Re: The student loan bubble
« Reply #15 on: August 07, 2017, 09:20:23 AM »
Another issue with student loans is that prospective college students aren't educated well enough on how the loans work, how ridiculous they can get, and on strategies to reduce debt. That's not to say that all the responsibility falls on one's high school - kids need to take the time to research for themselves - but I would have loved a day-long workshop on the subject when I was a senior in high school. It certainly wouldn't have hurt.

I agree completely.

It is frustrating how They tell you go to school and be something. Yet, if you do it puts you in a worse position unless the job is high paying and those aren't always available. It puts people off from going thinking they'll just be better off not having that degree and working their way up.

Its just a really messed up system that I don't understand.


The real problem is thinking there is a "They" that is telling you ANYTHING (and you listening to it).   You have to make the decision that is right for you.  My son - a success in every sense of the word, as far as I am concerned - decided he wanted to work on cars.  College is not the best route for that, so he went to a trade school, then after working for a couple years, joined the Army to work on helicopters.  With that, he will be as prepared for any job in his trade, as I am for a job in the legal field.  Moreso, perhaps.

What we've really done is get confused between what we NEED and what is NICE TO HAVE.  We've been brainwashed that our "passions!" are important or that are all you need.  I have zero sympathy for someone that racks up $200k in student loans to learn basket weaving and is baffled that the world isn't beating down their door for baskets.

I don't mean this to be a screed; I do have tremendous sympathy for someone who has put in the effort and the plan just hasn't materialized.  I get that, and it sucks.   But we have to break ourselves of this notion that we are not responsible for our decisions, or that we are just one vote away from having all our problems taken away.   The student loan "bubble" is in a lot of ways the same as the "credit card bubble" and the "housing bubble", and for the same reasons.   Who's fault is it that you chose the $500k house instead of the $250k house, just because some mortgage guy (whose commission is based on the loan amount) told you you could? 

I have to agree.  And this is kind of what I was thinking when reading the thread title initially.  The vast majority of people who go into debt don't have to.  They choose to.  And that debt gets compounded because of indiscipline and other bad choices. 

My advice:  (1) Avoid college debt if at all possible by any means necessary; (2) If you have already incurred college debt, once you graduate, continue to live like a student rather than "living like a graduate" until it is paid off. 

As to point #1, I put myself through college.  My parents' contribution toward my education can be summed up as: (1) My dad gave me $400 to help with the cost of upgrading my computer; and (2) I lived at home my first year.  I graduated with about $6,000 total debt.  That was because I worked HARD and made good decisions to keep the debt from spiraling out of control.  And looking back, if I had made smarter choices, that number could have been even smaller (or perhaps nonexistent).  Same types of decisions in law school, and I got out with no additional debt.  Graduated from law school with about $6,000 total (and my wife had less than that). 

As to point #2, despite having a relatively low-paying job in an expensive market, we again lived a pretty disciplined life and paid off the debt in a couple of years (I don't remember the exact timeframe, but it wasn't all that long in the grand scheme of things). 

Just saying, it can be done.  It isn't easy, and it isn't the norm.  But it can be done.  And it leads to a lot less stress.

So at what point does it become exploitative?

But is that even relevant if, hypothetically, enough people refused to be exploited?
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Offline cramx3

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Re: The student loan bubble
« Reply #16 on: August 07, 2017, 09:52:06 AM »
I agree as well with Stadler and Bosk, but I can't put all the fault on the kid.  Life has pressured lots of kids to take out college debt.  From parents to counselors to even their own peers.  Sometimes kids aren't even shown their options.  I know I wasn't.  Granted, I am happy with what I chose (to go to an engineering school) but I had no idea when I was young that skipping the cost of college and going into something like the police force would be a solid career choice.

Also, once out of college and now having to pay off that debt.  Sometimes you got to look at the bigger picture.  Maybe instead of getting the 30k car with that new job money, you should get the 20k car and pay off your debt.  I know that's not everyone, but I'm sure we all know at least someone who's managed their money that way.

After college I lived home for 3 years.  Not everyone is fortunate enough to have parents that let them come back home, but not everyone who has that option chooses it.  Of course living in my own apartment was affordable and more desireable, but instead of throwing $1500 into rent, I threw $1500 (literally) towards my student loan and had it paid off before I moved out of my parents house.  I think my statements were like $120 but I was paying at least 10x that every month or more. 

My younger brother took out a 10k student loan.  I cosigned (so I get the statements) and I see how he makes the minimum payments and it's sitting closer to 15k in debt now.  I think he could double the payments per month and actually start to kill his debt, but he doesn't seem interested.  He'd rather spent $200 a month in cigarettes.  His choice and his life, but I don't feel sympathetic to him when he bitches about his never ending debt.

Offline bosk1

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Re: The student loan bubble
« Reply #17 on: August 07, 2017, 10:07:59 AM »
I agree as well with Stadler and Bosk, but I can't put all the fault on the kid.  Life has pressured lots of kids to take out college debt.  From parents to counselors to even their own peers.  Sometimes kids aren't even shown their options.  I know I wasn't.  Granted, I am happy with what I chose (to go to an engineering school) but I had no idea when I was young that skipping the cost of college and going into something like the police force would be a solid career choice.

Yeah, I agree.  So few people know their options, and that is a big part of the problem. 

Also, once out of college and now having to pay off that debt.  Sometimes you got to look at the bigger picture.  Maybe instead of getting the 30k car with that new job money, you should get the 20k car and pay off your debt.  I know that's not everyone, but I'm sure we all know at least someone who's managed their money that way.

Yeah, the lifestyle choices are a HUGE part of the equation.  As for the car example, yes, absolutely.  But I would take it a step further and say, maybe instead of getting the 30k car with that job money, get whatever you can afford to pay cash for and never take out a car loan, EVER.  And even if you are paying cash, don't buy more car than you can afford, keeping in mind the other things you need to put your money toward, like taking care of other debt, saving up for a home, or saving for retirement, or just saving.  Case in point, I've been a lawyer for 16 years now, making decent money.  As of last year, I was driving a Mitsubishi SUV that we bought in 2003.  Unfortunately, I had a car accident and had to buy a new car.  Wanna guess what I bought?  Mercedes?  BMW?  Lexus?  Nope, nope, and nope.  $20K car instead of the $30K+ car?  Nope again.  I spent $3,700 on a VERY used Honda Civic.  Based on some other expenses and our budget, it was more important to get something VERY cheap that we could plunk down cash for, but should still be reliable.  Again, not patting myself on the back or anything, but again illustrating the point that it is about lifestyle choices.  I could easily talk myself into a more expensive car.  I make good money.  I've been working at this a long time.  I DESERVE it.  But bottom line is, I don't NEED it, and spending more money would take away from other important goals my family and I have, so that is the choice I will make 10 out of 10 times.

We aren't severely in debt, but I would highly encourage anyone who is to consider making those hard life choices that are less glamorous, but more in line with being financially responsible, which includes not incurring debt unless absolutely positively necessary.
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Offline XeRocks81

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Re: The student loan bubble
« Reply #18 on: August 07, 2017, 11:10:17 AM »
It is frustrating how They tell you go to school and be something. Yet, if you do it puts you in a worse position unless the job is high paying and those aren't always available. It puts people off from going thinking they'll just be better off not having that degree and working their way up.

Its just a really messed up system that I don't understand.


The real problem is thinking there is a "They" that is telling you ANYTHING (and you listening to it).   You have to make the decision that is right for you.  My son - a success in every sense of the word, as far as I am concerned - decided he wanted to work on cars.  College is not the best route for that, so he went to a trade school, then after working for a couple years, joined the Army to work on helicopters.  With that, he will be as prepared for any job in his trade, as I am for a job in the legal field.  Moreso, perhaps.

What we've really done is get confused between what we NEED and what is NICE TO HAVE.  We've been brainwashed that our "passions!" are important or that are all you need.  I have zero sympathy for someone that racks up $200k in student loans to learn basket weaving and is baffled that the world isn't beating down their door for baskets.

I don't mean this to be a screed; I do have tremendous sympathy for someone who has put in the effort and the plan just hasn't materialized.  I get that, and it sucks.   But we have to break ourselves of this notion that we are not responsible for our decisions, or that we are just one vote away from having all our problems taken away.   The student loan "bubble" is in a lot of ways the same as the "credit card bubble" and the "housing bubble", and for the same reasons.   Who's fault is it that you chose the $500k house instead of the $250k house, just because some mortgage guy (whose commission is based on the loan amount) told you you could?

Two things.   If by "basket weaving" you mean people who study philosophy,  sociology, litterature,  arts, music etc then I think we need those in a society too,  not just doctors, engineers and Lawyers.   Those fields don't lead to making lots of money unless you become some kind of celebrity.     

Second,  it's important that make good desicions about debt yes, but those bubbles you mentioned (housing, credit cards, student loans)  are what the continued existence and growth of the economy is predicated upon.   

Offline El Barto

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Re: The student loan bubble
« Reply #19 on: August 07, 2017, 11:22:09 AM »

So at what point does it become exploitative?

But is that even relevant if, hypothetically, enough people refused to be exploited?
Nobody knowingly volunteers to be exploited. That's why we have rules against it in many cases. My point is about when it becomes a matter of preying upon the stupid and naive.
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Offline Grappler

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Re: The student loan bubble
« Reply #20 on: August 07, 2017, 11:25:31 AM »
Handling any debt is doable, if you don't let it spiral out of control in the first place. 

My wife paid off her portion of her student loans in 10 years (she had an agreement with her dad and step-dad to split the cost.  Her dad filed for bankruptcy last year, and hadn't contributed to the agreed plan in a number of years, so we were paying for two of the agreed payments).  We also paid off two car loans, and have paid down the principal on our mortgage by over $40,000 since purchasing our house 8 years ago.  Money went into savings as well.

We are solidly middle class and work hard to live within our means.  We have college friends that travel the world and even invited us on a European trip once, but we declined.  I didn't want to spend $5,000 just for travel and lodging alone. These same people have taken out second mortgages to afford overseas trips and live paycheck to paycheck because they want to have a fancy social life. 

It's all about living within your means and being smart with money.  We'd pay extra on loan payments (home, car, student loans) if we had the money that month - sometimes double.  It cuts down on the total amount of interest due over the length of the loan, and reduces the principal at the same time.  We'd sacrifice for it - we spent many nights at home skipping expensive dinners in the city with friends, but we know that we're ahead in the long run.

Offline Stadler

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Re: The student loan bubble
« Reply #21 on: August 07, 2017, 11:49:28 AM »
I think what we've lost is a sense of perspective too.   When I was, say, 25, I walked up hill both ways in the snow.. no, what I'm getting at is, when I was 25, my expenses were:   
- Rent
- Food
- Car
- Insurance
- Any student loans I had.

Now, we take for granted that we HAVE to have the $100 Sprint plan with unlimited data, to play all that music we're paying $9.95 per month to Spotify for.  And the $175/month cable/internet bundle.   And the $20/month Sirius subscription, and the $50 gym membership, and the...

We've nickel and dimed ourselves ("what's another $15 a month?") into a corner and from a reliance standpoint, we can't get out of it.  Some of this IS discipline, even if we don't want to admit it (and no, I'm not at all perfect here;

Offline Stadler

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Re: The student loan bubble
« Reply #22 on: August 07, 2017, 11:54:58 AM »

So at what point does it become exploitative?

But is that even relevant if, hypothetically, enough people refused to be exploited?
Nobody knowingly volunteers to be exploited. That's why we have rules against it in many cases. My point is about when it becomes a matter of preying upon the stupid and naive.

I understand your point; and stopping the more egregious "preying" on the stupid and na´ve is not a worthless endeavor.   I'm more focused on the less extreme side, and talking about the people that know better, but who find it easier and more self-fulfilling to just say "let the govmint take care of it".  Very few of the policies of the major candidates this past November drove me as crazy as Bernie's "free tuition" and "absolution of student debt" platforms.  Not from the money side of it (though that too) but from the behavior it engendered:  we're NOT responsible for our actions, and we're NOT responsible for the consequences of our choices... oh, unless you're Ted Nugent, in which case we can bully you into toeing the line, because well, perceived racists DO have to be responsible for the consequences of their actions.   It's all about CONVENIENCE, and life isn't convenient, sometimes.

Offline Chino

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Re: The student loan bubble
« Reply #23 on: August 07, 2017, 11:55:29 AM »
We are solidly middle class and work hard to live within our means.  We have college friends that travel the world and even invited us on a European trip once, but we declined.  I didn't want to spend $5,000 just for travel and lodging alone. These same people have taken out second mortgages to afford overseas trips and live paycheck to paycheck because they want to have a fancy social life. 

This is the one thing where me and Victoria really butt heads. She came from a family with the "play now, pay later" and "just pay $10 a month, as long as they're getting something, they can't do anything about it" mentalities. She's currently sitting on $59K in student loan debt, and needs another $15K before interest to finish her masters degree. She's constantly hounding me to get my passport so we can see the world, and besides simply just not giving enough shits about it to want to, I'd rather not piss away any extra money we have just because we can. I was looking over her loans the other night with her (currently deferred) and her monthly payment is going to be a few bucks shy of $900 per month in a decade's time.

It makes me livid. I blame her for some of it (the current lack of accountability), but I put most of the blame on her parents for her being in the situation she initially got herself into. They're they ones who encouraged her to pursue her passions and take out $100K in student loans for a degree in Art History. She was 17 at the time and never had a loan prior to that. Like most people that age, she had no concept of what she was doing. Her brain was filled by promises of success just by working hard, and to a person that age with no real life experience, it's hard to put that kind of money into perspective.

Offline Grappler

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Re: The student loan bubble
« Reply #24 on: August 07, 2017, 11:58:40 AM »
Now, we take for granted that we HAVE to have the $100 Sprint plan with unlimited data, to play all that music we're paying $9.95 per month to Spotify for.  And the $175/month cable/internet bundle.   And the $20/month Sirius subscription, and the $50 gym membership, and the...

We've nickel and dimed ourselves ("what's another $15 a month?") into a corner and from a reliance standpoint, we can't get out of it.  Some of this IS discipline, even if we don't want to admit it (and no, I'm not at all perfect here;

It's 100% discipline.  I bring my lunch to work every day - if I ate lunch out in downtown Chicago, I'd be spending between $8 to $10 per day, even for a sandwhich, chips and a drink.  $10 per day x 5 days per week x 4 weeks per month is a total of $200 per month I'd spend on lunches out.  That's enough to pay for a few bills every month, so I buy a few loaves of bread, some lunch meat, a few bags of chips and a case of pop.  I can eat lunch for a fraction of the cost. 

My wife and I only have a modest, 2GB per month cell phone plan.  We use Wi-Fi at work and at home on our phones, and we don't do any mobile streaming.  It lets us keep our phone bill down so we can put money towards other things.

People have to learn that when they have debt, they have to choose to be responsible.  You can't pay your debt if you're living too extravagantly or trying to keep up with the jonses.  My brother in law has this problem - they live paycheck to paycheck because they don't make much money, but try to keep up with their friends, who do have money.  They lost their home because they weren't financially prepared to handle the adjustable rate mortgage payment that hit them a few years ago.

As to the original post - make those tough choices.  Go without a big mobile data plan, netflix, gym membership, or reduce it, so you can then make your student loan payments.

Offline El Barto

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Re: The student loan bubble
« Reply #25 on: August 07, 2017, 12:28:02 PM »

So at what point does it become exploitative?

But is that even relevant if, hypothetically, enough people refused to be exploited?
Nobody knowingly volunteers to be exploited. That's why we have rules against it in many cases. My point is about when it becomes a matter of preying upon the stupid and naive.

I understand your point; and stopping the more egregious "preying" on the stupid and na´ve is not a worthless endeavor.   I'm more focused on the less extreme side, and talking about the people that know better, but who find it easier and more self-fulfilling to just say "let the govmint take care of it".  Very few of the policies of the major candidates this past November drove me as crazy as Bernie's "free tuition" and "absolution of student debt" platforms.  Not from the money side of it (though that too) but from the behavior it engendered:  we're NOT responsible for our actions, and we're NOT responsible for the consequences of our choices... oh, unless you're Ted Nugent, in which case we can bully you into toeing the line, because well, perceived racists DO have to be responsible for the consequences of their actions.   It's all about CONVENIENCE, and life isn't convenient, sometimes.
Well, I think there are two issues there. For one thing, when does it cross the line into egregious? How old do you have to be before the guy selling siding is ripping you off? What percentage of the population should be able to read 18 pages of Legalese before joining a gym? Should the people who can't just be declared pigeons for all to rip off?  I'm sure you remember when new rules were instituted about how the terms for car loans had to be laid out in plain, simple English. You probably also remember how people thought that was a monstrous intrusion by the government. Why? Because it became slightly harder to bury people in debt?

My other problem is that with all of this talk about personal responsibility where are the lenders in this? It was a pain in the ass for me to get my first credit card. You were supposed to be a good risk. Now they hand them out to anybody knowing that they'll just take on insurmountable debt. The law is very clear that you can never unload your student loan. It'll follow you around for the rest of your life. Consumer debt is rapidly reaching that point, as well. Where's the risk to lenders? Why shouldn't they hand out platinum cards to college freshmen and send them advertisements for 5% off a 96" TV if the potential for default is no longer in play?
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Offline cramx3

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Re: The student loan bubble
« Reply #26 on: August 07, 2017, 12:33:04 PM »
Good points too.  Getting a line of credit shouldn't be so easy, especially for young people.  I know in college there were always people trying to get you to sign up on campus.  Kind of ridiculous. 

Offline XeRocks81

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Re: The student loan bubble
« Reply #27 on: August 07, 2017, 12:37:28 PM »

They're they ones who encouraged her to pursue her passions and take out $100K in student loans for a degree in Art History.

My thing is thay maybe it's not that should have chosen another degree, it's that studying art history shouldn't  cost her $100K. 
« Last Edit: August 07, 2017, 12:50:03 PM by XeRocks81 »

Offline cramx3

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Re: The student loan bubble
« Reply #28 on: August 07, 2017, 12:40:04 PM »

They're they ones who encouraged her to pursue her passions and take out $100K in student loans for a degree in Art History.

My thing is thay maybe it's not that should have chosen another degree, it's that studying art history shouldn't cost have cost her $100K.

Maybe not, but I'm sure her choice of school had something to do with that as well as her lifestyle going to school.  An art degree and your local university most certainly won't cost that much. 

Offline XeRocks81

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Re: The student loan bubble
« Reply #29 on: August 07, 2017, 12:45:56 PM »

They're they ones who encouraged her to pursue her passions and take out $100K in student loans for a degree in Art History.

My thing is thay maybe it's not that should have chosen another degree, it's that studying art history shouldn't cost have cost her $100K.

Maybe not, but I'm sure her choice of school had something to do with that as well as her lifestyle going to school.  An art degree and your local university most certainly won't cost that much.

I was just using that as an example but you're right of course.   I'm just trying to keep the perspective open that higher education isn't only about getting jobs.  We need to study our world and culture and try to uderstand ourselves better and that doesn't usually generate profits. 

Offline Grappler

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Re: The student loan bubble
« Reply #30 on: August 07, 2017, 12:46:15 PM »
My other problem is that with all of this talk about personal responsibility where are the lenders in this? It was a pain in the ass for me to get my first credit card. You were supposed to be a good risk. Now they hand them out to anybody knowing that they'll just take on insurmountable debt. The law is very clear that you can never unload your student loan. It'll follow you around for the rest of your life. Consumer debt is rapidly reaching that point, as well. Where's the risk to lenders? Why shouldn't they hand out platinum cards to college freshmen and send them advertisements for 5% off a 96" TV if the potential for default is no longer in play?

They run a business, not a counseling center.  Yes, there could be legislation to reign them in, but it's all about learning to control your spending.  They're not responsible for teaching people how to use it.  They want you to use it excessively and rack up a high balance and lots of interest.  That's also why they advertise rewards programs.  I used my miles to get a rental car several years ago and calculated that the actual cost of purchases for the cost of my rental car was somewhere over $10,000, since the miles were accrued by only a fraction of the dollars spent to earn them.   The risk they run is when people file for bankruptcy and their debt is discharged.

Where are the parents to teach these kids how to control their credit card?  I got one when I was 18 and my parents sat me down, handed it to me and taught me not to use it unless I could afford to pay the full bill the next month.  In 19 years of having that same credit card, I have only carried a balance for 3 months.  I have always paid it off in full, even when I racked up a big balance.  I had money in savings to cover it.

Offline Cool Chris

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Re: The student loan bubble
« Reply #31 on: August 07, 2017, 12:50:17 PM »
I was just using that as an example but you're right of course.   I'm just trying to keep the perspective open that higher education isn't only about getting jobs,  we need to study our world and culture and try to uderstand ourselves better and htat doesn'T usually generate profits. 

Fair enough, but if you are going to choose a path in life that might not generate the income you desire, you have to accept what your future lifestyle is going to look like. Though I would argue we don't need a advanced degree to understand culture, for example.
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Offline Chino

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Re: The student loan bubble
« Reply #32 on: August 07, 2017, 12:58:50 PM »
My other problem is that with all of this talk about personal responsibility where are the lenders in this? It was a pain in the ass for me to get my first credit card. You were supposed to be a good risk. Now they hand them out to anybody knowing that they'll just take on insurmountable debt. The law is very clear that you can never unload your student loan. It'll follow you around for the rest of your life. Consumer debt is rapidly reaching that point, as well. Where's the risk to lenders? Why shouldn't they hand out platinum cards to college freshmen and send them advertisements for 5% off a 96" TV if the potential for default is no longer in play?

They run a business, not a counseling center.  Yes, there could be legislation to reign them in, but it's all about learning to control your spending.  They're not responsible for teaching people how to use it.  They want you to use it excessively and rack up a high balance and lots of interest.  That's also why they advertise rewards programs.  I used my miles to get a rental car several years ago and calculated that the actual cost of purchases for the cost of my rental car was somewhere over $10,000, since the miles were accrued by only a fraction of the dollars spent to earn them.   The risk they run is when people file for bankruptcy and their debt is discharged.

Where are the parents to teach these kids how to control their credit card?  I got one when I was 18 and my parents sat me down, handed it to me and taught me not to use it unless I could afford to pay the full bill the next month.  In 19 years of having that same credit card, I have only carried a balance for 3 months.  I have always paid it off in full, even when I racked up a big balance.  I had money in savings to cover it.

That's the problem. A lot of kids taking out these loans don't have that kind of support or instruction at home. They don't have someone who can explain these things to them or help them figure it out. The only adult figure who can guide them through the process in some way is a guy who's working for a business, not a counselling center. It sucks but it's the reality of it.I get your argument, but I think that argument can only go so far. We don't allow cigarette companies to advertise because of potential harm to the public. There are laws protecting frail old people from getting suckered by scams (though not always effective). Why aren't there any for young people? If you have a kid who grew up in the hood with no true parent figures of any kind, and they happen to be one of the good ones that tries to get out and do something with their lives, is it really ethical to allow their only guidance to be from a salesman whose number one prerogative is to get them in debt?

Offline Stadler

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Re: The student loan bubble
« Reply #33 on: August 07, 2017, 01:00:47 PM »

They're they ones who encouraged her to pursue her passions and take out $100K in student loans for a degree in Art History.

My thing is thay maybe it's not that should have chosen another degree, it's that studying art history shouldn't  cost her $100K.


You make my head explode sometimes.  Why?  If that's what it costs, if that's what the school charges, that's their business.   If no one buys it - the course load - then they'll change.   Plus, at least at the school I went to (large state school you've heard of because no one can beat them in women's hoops) it cost the exact same for an art history major as it did for an electrical engineering major as it did for a teaching degree.   

Chino is laying out his thoughts on the matter - and I don't disagree with him, BTW - but if he and Victoria were as one on that, and accepted it and lived their life as they saw fit, who are we to say what it SHOULD have cost?   telling a university what they can or can't charge is not going to have any good impacts for the end result, because it's not as if the school is just going to eat that difference and say "yup, on us!".   

Offline Chino

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Re: The student loan bubble
« Reply #34 on: August 07, 2017, 01:14:44 PM »
Maybe not, but I'm sure her choice of school had something to do with that as well as her lifestyle going to school.  An art degree and your local university most certainly won't cost that much. 

She went to American University in Washington DC and spent a semester abroad in Italy as well. She loves art and history, and her dream job/goal was to become a museum curator. She could have gone to a number of cheaper schools for an art history degree, but she wanted to be in an area with a lot of museums and galleries for the best chance of making connections and getting internships. She worked in a number of places down there including the Smithsonian.

I really have mixed feeling about it. I got a relatively cheap degree solely to make good money doing a job that I hate more and more every day. I feel completely dead inside most of the time here. She at least pursued something she loved in an effort to be happy throughout her days. It's not something I had the balls to do. But that pursuit, at least in my mind, doesn't necessarily translate to a good decision. Museum curators are one of the rarest jobs in the country, and for $100K worth of education that didn't even include training in things like artifact preservation and handling, that's a hell of a gamble. But in her 17 year old mind, the odds weren't that against her. She had a "support system" at home every step of the way telling her she could do anything if she tried hard enough, and counselors at every school showing her big dollar signs after graduation. She, like many, got taken for the dream ride.