Why I don’t want you to pay off my student loans

First off, they’re MY loans for MY education that I took out, therefore, MY responsibility. Sadly however, we live in a society that seems to believe in no personal responsibility.

So I see a lot of talk about how cheap it would be for everyone to pitch in a pay for education, and how Obama said it would only cost 8 Billion a year and how education costs have sky rocketed, etc. etc.

So lets look back at say, 1960. Most colleges, from the little bit of googling I did, cost between $1000 and $1500 per year. those were the big name Universities like University of Texas, U Penn. Berkley, and so forth. A new house was $13,000, and a car was $2600.

So if we look at today’s world, most new cars are $25,000 to $35,000. Sure there are luxury cars that cost $75,000 and even $750,000, but few own those. My car was $32,000 new, but I paid $20,000 for it with 3 years and a few miles on it. Car payment is $372 or so.

A lot of houses cost $100,000 to $250,000, I just bought mine 4 years ago for $95,000, 3 bedroom, 1 car garage, a yard, nothing special, mortgage and taxes run about $725 a month.

I earned my bachelors degree in 2010, and am currently working on a masters from the same school. Yes it is the University of Texas, but its a smaller branch school, at Tyler. So it appears that roughly, the cost of a car has gone up 10X, and housing has done about the same. What about school though? I paid about $5k per year for my bachelors, and them same for my masters. Granted Masters programs are have the hours, so really tuition is twice as much, so were looked at 5-10,000 per year on school. Also up 10X. From what I can see, the cost of school has gone up accordingly.

Of course there are still the outliers, Rice, Baylor, Harvard, but no one NEEDS to go there, same as how no one NEEDS a million dollar home, or a $300,000 Ferrari. However, everyone needs somewhere to live and a means of transportation, but no one needs an education. currently only 60-70% of high school grads attend college.

First point. college is not expensive, unless you make it.

I didn’t go to school all that long ago, and I spent $25K on a Bachelor’s degree. That was 5 years of school at $5k per year.Long story short, I basically financed the entire thing. No rich parents, no fancy grants or scholarships. I think my very last semester I got a $500 grant. I got into Baylor and Texas Tech, and maybe a few other schools, But there were going to cost something like 45k and 30k per year, respectively, which makes for a quarter million dollar Bachelors degree. I knew that I didn’t need that anymore than I needed a Ferrari or a mansion . My student loan payment is at 7% for 11 years, making it $234/ month, less than a mortgage, less than a car note, and a littler more than my cell phone or electric bill.

Second point. College is a place to get an education, not to chase your dreams. You have to think of it as an investment in yourself. Way too many people want to go to some fancy liberal arts or private school and get an obscure degree with a fancy title. For example, a degree in philosophy, or anthropology, leaves you with two choices, become a philosopher/ anthropologist, or get a higher degree. These are the people who spend $150,000 on a degree, then work at Starbucks and blame everything on Republicans. To me this is no different from someone buying a Ferrari and driving to said job at Starbucks, and blaming Republicans. They made a poor investment choice, and refuse to accept responsibility.

I on the other hand, got a degree in nursing, I didn’t do it for the money, I did it because I enjoy it, but I also knew I wanted to have a secure, stable career path. That’s why I get frequent job offers, with good pay, even in a bad economy. 12-year-old me would have loved to go to a big school and be a geologist and play with rocks, but 18-year-old me was a bit more sensible. By the time I had done 2 years at a junior college I definitely knew a bit more about how the world works. Cheap degree worth a lot of money. This is the equivalent of the bank manager who drives a Honda to work.

3rd point, simple math.

Lets take a look at $25,000, a reasonable amount of loan debt one might accrue for a bachelor’s degree. A lot of cars cost $25,000. It’s not a stretch to think a recent college grad would buy a new car for themselves. A car note is going to run you 3% for 4 years. That’s going to cost $553 a month, and after interest cost $26,500. and after that time will be worth about $17K so you lose $9,500. Not a wise investment, but a somewhat necessary one. A house is going to cost $250,000, I got qualified for the exact amount when I started house shopping at age 23, 6 months out of school. That’s $1200 a month for 30 years at 4%, and will cost a total of $429,000 after interest. Of course after 30 years the home value will appreciate, but you still can’t bet on that for making you a lot of money. This is also why I chose to spend $100,000 instead. Now how about school. $25,000 for 11 years at 7% that’s $272 a month, and cost a total of $35,900 with interest. Let’s see what its worth. Lets not add raises, just for simplicity’s sake. But currently a highschool diploma is worth $30k per year. from age 18 until retirement at 64. that’s a lifetime income of $1,380,000, with a $0 investment. A $25k bachelors degree has earned me about %75k per year, from age 23 to also retiring at age 64 is $3,075,000. That’s an extra $1,695,000 for a $25k investment, plus always working in the A/C, job security, great benefits, etc.

A house, neutral investment, a car, bad investment, an education, GREAT investment. Loan money is easy to get, and as evident, practically thrown at students. Use them with a little common sense and it’s not that big of an issue. For less money every month than a car payment, rent, health insurance, or a mortgage, you can have something that will earn you millions. So you REALLY expect sympathy about repayment.

Third point, the principle of the matter. You borrowed the money, and invested it how you see fit, and now you pay for it. Banks made bad investments, and the government bailed them out, remember the #occupy movement? and now you want the government to bail you out? hypocrite much? I think they should have let the banks fail, let the auto makers failure. Let the strong companies that make good decisions survive. So by the same stroke, I am proud to pay my loans every month because I earned enough money before my lunch break on the first day of the month to make the payment. It gets auto-drafted from my check and I never notice it. I’m just as proud of that as I am when I get a statement in the mail showing how well my retirement fund is doing. I feel like every month I invest $234 back, and then I get a check back (paycheck) worth more than 10X as much.

Before we start funding each others educations, how about we fund each others cars or houses, something EVERYONE needs. then we can all like in the same cookie cutter house and drive the same cookie cutter car. While were at it we can pay each others healthcare, and get VA type care with month-long waiting lists and stacks of paperwork. How about we give the government 100% of our paychecks and let them provide everyone with same lifestyle. Wait a second, it’s that kind of like slavery? you work for “the man” get no money, and therefore can only have what he provides for you?.

I wouldn’t consider myself anti-government or worried about big brother, but I’m also not naive, I see that anytime the government pays for anything, they control it. if you want the government to pay for your school, you can bet they will dictate it. so much for free choice. It’s already evident how government spending is incredibly wasteful, and just like hospitals have adapted to Obamacare, they are more worried about raking in every government dollar they can, and no longer worried about patient care. Schools will do whatever they have to get as much tuition money as possible, so I hope you enjoy 300:1 student to teacher ratios and 18 hour per semester requirement.

Side note: Someone very close to me got a Bachelors in Art from a private school, and rang up over $50,000 in student loans, her degree offered no job opportunities and her current job requires no degree so her loan payments are roughly 50% of her income. I have seen first hand the disparities of being strapped with student loan debt, but at least she acts like an adult and takes responsibility for her decisions. She could never live with her self knowing someone else was paying for the decision she made.

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