College Grad: 200K in debt

mjs1987 · #1 Dec 4, '10, 6:40 pm

I came across this article today: http://finance.yahoo.com/college-edu...ady-to-explode

She created a website where she asks for donations. She has raised 7K to pay off her debt. I wonder why people would help someone that got into that much debt and used so little personal responsibility doing so?

Booter · #2 Dec 4, '10, 7:38 pm

If people are willing to help her out I say good for her....as a young person with student loans to pay off i empathize with her

Brendan McCabe · #3 Dec 4, '10, 7:59 pm

She clearly had a really great time in college.

TedDC · #4 Dec 4, '10, 8:12 pm

Very poor judgment to go deeply into debt for an expensive education in a field where jobs are low-paying and scarce even in good economic times.

mh2007 · #5 Dec 4, '10, 8:19 pm

Normally, we would expect to see ‘mortgage-sized’ debt to finance med school, PhD programs, or law school. That kind of debt is equivalent to the median home mortgage in the U.S. However, incurring that level of indebtedness for an undergraduate degree in Sociology is way out of line. There’s no way that graduate will make anywhere near what a doctor or lawyer will make. I would say it qualifies as an unmitigated fiscal tragedy, akin to debt slavery.

I’ve heard of college kids getting hooked on Internet gambling - football, poker, etc., and running up 6-figure levels of credit card debt before graduating from college (also tragic).

The lesson to be learned here is that youth + easy money /credit is like an addictive narcotic. However, the withdrawal and recovery may take decades. Adulthood will be an epic financial struggle for that girl, and her future family, which by the way could have been avoided with a little common sense. Something must have gone terribly awry for her, and/or her parents.

Don’t let this happen to your family.

mjs1987 · #6 Dec 4, '10, 8:56 pm

My problem is not really the debt. Lots of people get into debt for college. Sure, its a terrible business move and one is not wise to make it.

However, I feel we are encouraging people to make bad moves by feeling sorry for them and pay off their debt for them. I think it shows a bit of an entitlement mentality. It is like she doesnt feel she is responsible and other people should take care of the mess she made. In other words, its everyone else's problem.

In this bad economy, it is in bad taste to go begging for money when you clearly made bad moves and spent lots of money on unnecessary things such as a trip to Europe.

I fear we are giving young people the message that they can do anything and in the end, their problems will become the burden of other people.

It does not encourage personal responsibility to help someone pay back loans when they were spending money like crazy and treating themselves well while spending other peoples money.

It also does not encourage young people to stay out of debt and to work while in college. Why should people work or stay out of debt if other people will pay back the loan or if you will never have to pay it back?

**JimG** · #7 Dec 5, '10, 11:42 am

Every student should make a cost-benefit analysis before incurring student loan debt. If there is no chance of the education offsetting the debt, then it shouldn't be incurred. Also, I think that education loans cannot even be discharged in bankruptcy, so it really does become a sort of voluntary chattel slavery, incurred by choice.

BlueSprite · #8 Dec 6, '10, 8:39 pm

Hmmm...this is a bit of a two-fold problem...without question college tuition has skyrocketed in the last 20 years or so (particularly the last 10 I'd say)...however! All that being said:

All I can say to this girl is - what the heck!?!?! I mean seriously...200k!?? Did she have no one to speak with? Apparently not...but she got a co-signer on those loans...so someone besides herself knew.

You have to use a bit of common sense in this day and age. Everyone knows jobs are short...and you can't always study what you'd like. Sometimes you gotta study what will give you a job...or...if you want to study what you like and job prospects for that are extremely low (think Sociology degree), then go to a state school...or better yet...this girl should have gone to a Community College for the first two years and then transferred the credits to U Mass or whatever. It's incredibly easy to do that here in Mass.

Northeastern??? Really???

I don't really have much sympathy for people who find themselves in a world of debt...not incurred in this fashion. It's one thing if a person had a job and then finds themselves unemployed - sure - that out of their control. But even though this girl was young...she wasn't that young. It's not that hard to research the cost of college tuition, financial aid, scholarships, grants...etc...and to look at schools that would provide the most bang for one's buck. Sure it's not always the ideal or your first choice...but heck, beggars can't be choosers. You deal with what you were dealt. I can forgive ignorance in children...but I have a hard time excusing it when one is a college educated. Surely it's not asking to much for an 18 year-old have a little foresight?

But...then again...the article did make a good point that if you're the first in your family to go to college you could, theoretically, be totally out of it and 100% clueless...although I find that a little hard to believe too.

ac claire · #9 Dec 7, '10, 7:57 am

That's a ridiculoous amount of student loan debt. What exactly did she think was going to happen when she graduated? She probably thought that she'd just defer the loans or make minimum payments or something. If so, then that's what she needs to do IMO. Yeah the interest is high but she made her bed. I had a huge amount of student loan debt as well and had to end up defaulting on it, and then had to deal with the consequences-- bad credit and the debt collectors going after my co-signer (my mom).

I can see donating money to help out a needy family or someone with a legitimate life or death financial situation, but not this.

Orogeny · #10 Dec 7, '10, 8:18 am

I think her first real-life lesson should be finding out what happens when you amass a debt that you cannot repay. I don't think anyone should contribute a single penny to help her out.

Peace

Tim

Nanny PK · #11 Dec 7, '10, 8:26 am

This is such a sad commentary on our young people -- no clue what the consequences of borrowing money are.

While I understand the need for college debt, this seems to be way out of whack for the degree she got. That's more in line with what a doctor or lawyer would accumulate. She should have done a lot of research on what her interests were but also what the job prospects were available for her chosen field -- knowing that a majority of people don't end up working in their chosen field.

I was blessed enough to come out of college with very little school debt -- a little bit of credit card debt -- BUT I went to a junior college and got an associate's degree in a field that I enjoyed and now make a very decent salary.

Marie682 · #12 Dec 7, '10, 9:09 am

Quote:

Originally Posted by BlueSprite

:But...then again...the article did make a good point that if you're the first in your family to go to college you could, theoretically, be totally out of it and 100% clueless...although I find that a little hard to believe too.

I was the first in my family to attend college, and yes, I was a bit clueless because of it. I went to a Catholic college prep high school (the reason my parents could not afford to help with college itself), and we had absolutely no guidance regarding financial aid and loans for college, presumably because most parents were footing the bill.

I truly was under the impression that I would go to college, get a job right away, and pay off my debt. My parents thought so too- neither of them having gone to college, I think they were happy to see their daughter go to college and assumed I'd be better off financially than they were.

I also chose a social science major. Again, I thought having a degree itself would be enough. To an extent this is true- unless you are in something like business or nursing, most liberal arts degrees are the same as the next one, and in many cases will provide more opportunities and higher pay in the job market. However, if I could do it over I would have chosen something different. I really don't think there is enough guidance for people entering college regarding the debt they are taking on.

That being said, I think this girl has a nerve asking people to pay off her debt for her. She needs to take responsibility for it and figure it out on her own. That's what you do as an adult. She could get another job. She could even go to graduate school on a full tuition scholarship and a teaching assistant stipend. While I empathize with her, I think she is making herself look immature, and the people donating to her "cause" aren't helping her one bit.

BlueSprite · #13 Dec 7, '10, 9:39 am

Yes you make a good point. It's really hard to understand what it's like to have zero guidance if you never have had someone or some people in your life to provide that for you. I am the youngest of four so by the time it came for me to go to college I had my older brothers advising me "Hey...don't bother with the $$$ schools...just go to a state school...it makes no difference."

Yes in regards to the woman in the article...I feel it's a bit gauche to be asking for cash online...especially with the knowledge that there are starving children and people all over the world in desperate need of money. However, if people want to donate...well, that's their prerogative I guess?

I would rec. to her to perhaps pursue a teaching degree...there are some "fast track" programs that will erase one's college loans if they agree to stay and teach in low-income areas...something like that could work to her advantage. Also I believe peace corps will reduce one's student loans to an extent as well?

Rach620 · #14 Dec 7, '10, 7:06 pm

Quote:

Originally Posted by Marie682

I was the first in my family to attend college, and yes, I was a bit clueless because of it. I went to a Catholic college prep high school (the reason my parents could not afford to help with college itself), and we had absolutely no guidance regarding financial aid and loans for college, presumably because most parents were footing the bill.

I truly was under the impression that I would go to college, get a job right away, and pay off my debt. My parents thought so too- neither of them having gone to college, I think they were happy to see their daughter go to college and assumed I'd be better off financially than they were.

I also chose a social science major. Again, I thought having a degree itself would be enough. To an extent this is true- unless you are in something like business or nursing, most liberal arts degrees are the same as the next one, and in many cases will provide more opportunities and higher pay in the job market. However, if I could do it over I would have chosen something different. I really don't think there is enough guidance for people entering college regarding the debt they are taking on.

That being said, I think this girl has a nerve asking people to pay off her debt for her. She needs to take responsibility for it and figure it out on her own. That's what you do as an adult. She could get another job. She could even go to graduate school on a full tuition scholarship and a teaching assistant stipend. While I empathize with her, I think she is making herself look immature, and the people donating to her "cause" aren't helping her one bit.

I share your experience and totally agree with your observations.

For many young people who went to "college prep" high schools, there really was no guidance when it came to making a "cost-benefit analysis" of debt vs projected salary at graduation. Six years ago when I was looking at different colleges, they were telling us that going to the best school was most important, as our program of study would likely change.

While I do think many young people need to learn to be more realistic, the tools simply aren't in place in most places to help them do just that, and the expectation (voiced on CAF among other places) is that the debt is justified because upon graduation the student will make more than enough to pay back the loan. So in some sense, I don't blame this girl. (And I don't really have the moral high ground to do so, as someone with a political science and theology degree from a university whose tuition was $40-45K/year when I was there.)

Whatever the case, the article is right--this college tuition bubble is going to be the next one to burst. Especially with the federal government as the only student loan lender at this point, it's just going to be a mess. And in this economy that yields high unemployment for college graduates who owe loan payments such as this, people are starting to see that college tuition is incredibly inflated in most places.

**JimG** · #15 Dec 8, '10, 9:28 am

Quote:

Originally Posted by Rach620

Whatever the case, the article is right--this college tuition bubble is going to be the next one to burst. Especially with the federal government as the only student loan lender at this point, it's just going to be a mess. And in this economy that yields high unemployment for college graduates who owe loan payments such as this, people are starting to see that college tuition is incredibly inflated in most places.

I think you are right on this point. The wide availability of education loans enables university administrators and professors to continue to have high salaries. High prices (i.e., tuition) normally lead to weakening demand, but student loans keep the demand high, in return for a lifetime of indentured servitude.