Home > Inspiration, mentor, Self Help, Success > To the class of 2011, Choose debt free! Part Two

To the class of 2011, Choose debt free! Part Two

This is part two of the blog, To the class of 2011.  It picks up with my predictions for what the class of 2011 might expect now as they move forward with their lives over the next couple of years.

Here’s how the scenarios might look to a majority of you.

A.  You go away to college and have no idea how much it costs.  Tuition, room and board, gas, phones, utilities, rent, cable, internet etc.  No idea.  That’s okay!  You have a $500 scholarship and your FAFSA application.  You’re covered!  (Not really.)  Let’s continue; You are doing great at school and you are secretary of the student council, volunteer at the local animal shelter and have a fantastic 3.45 GPA in Political Science.  Once you take off that silly hat, you need a plan.

You are doing an amazing job and continue to do so for the next couple of years.

Fast forward to college graduation and now you are one of the lucky who made it all the way through unlike some of your roommates who just have thousand of dollars of debt and no degree.  You’re different because you have tens of thousands of dollars of debt WITH a degree.  You’re in great shape! (Not exactly.)  At 22 years old the world is yours for the taking.  If you’re going to work for your Uncle’s Firm and have a job all lined up you are in the minority.  Congratulations.  Most people don’t have a good job lined up.  Most people have to go out and look for a job.  The funny thing is, that after four/five years of college, you failed to learn how to write an effective resume and how to interview.  Uh oh.

So now you’re broke, don’t know how to interview and your resume consists of one line of education and work experience totaling assistant shift supervisor in the cafeteria.  With 9% unemployment nationwide (it’s still going to be rough in four years from now) what sort of rock star job to you think you’re going to get?  For a large number of people who aren’t engineers and computer science majors you’re probably going to revert back to what you know.  A job that you probably held BEFORE you left for school.  You’ve moved back in to your parents place because you can’t afford rent right now.  Good thing they kept your bedroom the same.  There is one big difference though, now you have fifty thousand dollars worth of student loans to pay off making $10-$15 an hour.  Ouch!

You see, the debt you incurred changes your mindset.  Instead of being able to do the unpaid internship across town, now you have to go and work in an unrelated field.  Instead of getting married to your college sweetheart you hold off because he is also living at his parents house because of his student debt.  You’re entire life changes because of that debt.  Keep that in mind when you sign on the dotted line.  Your choices have consequences.

This is not 10 years or even 15 years ago when my contemporaries were securing their first jobs outside of college.  It’s going to be much harder for you not just because of the job market but because of your debt load.  Student loan debt is one of the only debts that you can NEVER get rid of, not even through bankruptcy.

All this is yours forever (or what will seem like forever) if this is the path you take.  You’ll be hitting 40 years old and still paying the same tired old bill because your 18-year-old self signed up for it.  So, high school graduate, don’t you think it’s time to take another look at how you’re actually going to pay for your education?

Or you could consider this.

B. You work.  You work like you’ve never worked before.  It won’t kill you, trust me.  You’re 18 and healthy.  In this scenario you may work at a job or trade that requires you to work your way up and pay your dues, all the while they pay you while you earn valuable experience.  Great!  Keep doing that.  Just keep saving and paying with cash.

If you still want to go to college great!  You can do it.  Here’s what I propose.  Go to work.  Get two jobs.  Live at home.  You’re parents probably wouldn’t mind especially if you keep doing chores.  It’s a great deal you’ll soon find out.  Save for that first semester and go to the local community college.  Do that for two years.  You heard me TWO years.  During that time you’ll have done a couple of things.  You will have learned how to WORK and how to SAVE.  You’ve personally funded your first two years of school AND you’ve saved enough to move on to a four-year school to graduate.  You are putting yourself through college and you’re only making about $25k a year for the last two years.  Great job.  You also wont’ be afraid to pick up a part-time job while you are at your new university either.  Because at this point, just working one part-time job while taking fifteen credit hours is a breeze.   Now this route may have taken you more than four years.  That’s okay.  Maybe it took you six years and now you are twenty-four years old with a college degree and ZERO debt.  Not only that, you have YEARS of work experience under your belt in a myriad of different industries.  You had the freedom to switch jobs because you could!  You followed your passion one, $13 dollar an hour job at a time while you fit in class and studying.  You have a new appreciation for hard work and what your efforts are worth.

The difference between these two scenarios in easily quantifiable.  It’s a debt load equivalent to a starter home or a brand new 5 series BMW.  It’s massive, ugly and will be a part of every decision you make until you are at least forty years old.  That debt isn’t going to go away when you get married or have kids or try to buy a house or a new car.  All the time the debt load will be there for the person in Scenario A.  The people in Scenario A followed the masses and didn’t realize it was leading them down a path chained to a massive bill that they can never get rid of.  Education at any cost is silly.  Do it smart, don’t learn the hard way and pile on the debt.  The group in Scenario B worked hard, saved and paid for cash at the tender age of 24, they are debt free.  They are free to follow their hearts and dreams without the burden of an extra, interest bearing bill every single month for the next fifteen or more years.

You decide which one makes more sense.  You’re an adult now.  You can do what you want.

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  1. Keith Bowers
    June 8, 2011 at 8:41 am

    This info can be found in book form with “Debt Free U” by Zac Bissonnette. There is also a “Graduates’ Survival Guide” put together by Rachel Ramsey-Cruze at this link: http://tinyurl.com/5t27bqu.

    Spot-on, Matt!

  1. June 8, 2011 at 7:12 am

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