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I graduated college in May of 2016 with $60,000 in student debt.
Student debt is a reality most of us face, but beyond the “fucking loans, man” one-off comments at the bar, it is something we rarely discuss. Certainly, amongst my peers, I have never had a candid conversation about the psychological and emotional impact loans can have.
Student debt has come to plague our generation in ways that I believe will have an irreversible impact on the choices we make, on our expectations for the future, and how we navigate our adult lives. It will affect how we raise our children or if we have children, our livelihood as we retire, and it will certainly dictate what it means to be a “successful adult.”
I want to caveat this with an assertion that this is not meant to be a commentary on the greater college education system, nor is it soliciting advice on the ways with which someone can obtain a college degree without going into debt. There is a multitude of choices one makes from ages 18-25 in regards to higher education, personal finances, and alternative versus traditional paths to success and I don’t mean to placate or judge any particular path. In fact, I am here to tell you that whichever path you chose at the time, you were doing what you thought was right and that is perfect.
Sometimes I want to scream at the top of my lungs. I want to yell as loud as I can, “I’m doing the best I can!” to whoever will listen. I want to drop every single ball I have in the air and close my eyes and let the chips fall as they may. I’m not proud of it, but sometimes I get so dangerously close to letting things fall apart that I wonder what would happen if they did. Sometimes the weight of my reality is heavy and exhausting and when I’m alone with it, I feel as if it may suck all of the air out of the room.
I couldn’t say one way or the other if I regret my expensive degree. Being a student is one of my favorite things in this world. In college, I recognized my worth as an academic, something I didn’t get in high school. I learned of a different kind of work ethic, night classes and a full-time job does that to a girl. I also partied and made mistakes and laughed my ass off and made friends whom I probably would consider worth the price tag all on their own. In college, I became the version of myself that would lead me to who I am today. A person in progress, but still a person I am proud to be.
What I struggled with the most this past year is not that a majority of my paycheck each month goes to the university (a business machine that cares very little about my wellbeing), but that I felt very limited in my choices as a result of my debt.
For the first year after graduation, tapes played over and over in my head as I spiraled farther and farther into self-pity and honestly, a feeling of helplessness.
“If only I didn’t need to pursue a stable, high paying career…I’d be doing XYZ.”
“If only I could have taken a break after school… I’d have more time to pursue XYZ passion”
“If I didn’t have debt, I could save for XYZ.”
The list of all the things I could be doing if I didn’t have to pay my loans was exhaustive. I’d start a business! I would finally write that screenplay! I would work for a non-profit!
The script in my head – the one that propagated the notion that I wasn’t following dreams or living out my full potential, all because I have student loans – became so deeply ingrained in my daily mantra that it began to seep into my personality. I was whiny and full of resentment. Was this the rest of my life? Grinding, grinding, grinding away at loans that I shouldn’t have been allowed to take on at 17 years old in the first place?
I was operating under the assumption that if I was debt free, I would be a better version of myself. And I’m sorry, but that is bullshit.
After a year of feeling utterly disheartened, I finally am able to be at peace with my loans. I no longer viscerally hate them, they don’t feel like a poison coursing through my veins. Yes, that is how deeply I used to feel my loans – they became a physical burden.
To get to this place, however, I had to reposition how I think about both my loans and myself. Here’s where I’m at.
I am not special and my loans are a Lambo.
Part 1 – I Am Not Special.
Doing what you love for money is a luxury 99% of the world does not get. In fact, no job, all of the time, is going to be complete and utter pleasure. Painters invoice, writers edit, salespeople submit expenses, and farmers wake up really fucking early. That is a given. But even all things considered, if you have found reason in your work, you are an exception not the rule. By this, I mean if you’re a bicycle maker, you may not enjoy sourcing parts from various vendors, but you do it for a reason – you love building bikes. If you’re a writer, you probably despise printing manuscripts and sending them to publishers, but you do it for a reason – so you can continue writing.
A whole lot of people do not find their reason as it relates to work, they do not get paid to do the thing that lights their fire, and that’s okay. Employers are also not obliged to help you discover your passion, or stoke your fire, or help you feel stimulated in your job. That is for you to do if you want to. If not, you can collect your paycheck and find fulfillment somewhere else.
It is an incredibly privileged assumption that I deserve to feel fulfilled creatively in my work without doing anything to achieve that. I am not special just because I “want” to have the opportunity to be my best self, and it is a cop out for me to assume that I would automatically become my best self if I was debt free.
My debt is not a barrier to pursuing my passions – I am that barrier.
If I truly want to feel more stimulated or excited about my job, the only way I am going to get there is if I take action to do so. Debt has nothing to do with it.
Part 2 – My Loans Are A Lambo.
There is a (slightly tongue in cheek) saying in sales that says once you start to find success, you should buy more things in order to keep yourself motivated to close bigger and bigger deals. I first heard it referenced on Dudes Doing Business but essentially the idea is that if you get a promotion. you should buy a car you can’t really afford, say a Lamborghini, so you’re motivated to continue to grind.
Now, I certainly do not promote this way of life, honestly, because that’s an insane thing to do. But what I like about it – now stay with me – is that it is a monetary obligation to meet your goals and then strive for more. It is a monthly bill, whether it is a car payment, mortgage, children’s education, or dream vacation that doesn’t let you off the hook.
My loans are the financial obligation that demand I go to my corporate job every day, and it is in being forced to go to that job that I am reminded that I better hustle my ass off if I want more.
For all the math people out there:
A = Monthly loan payments.
B = Go to corporate job to pay loans.
C = Realize that a corporate job doesn’t stimulate me, become driven to go out and find what does.
A + B = C
My loans hold me accountable, they demand I continue to work in business, and that I develop skills in corporate America that I otherwise may not have been exposed to. But more than that, they demand I prioritize the time I have during my work week if I want to cultivate other passions.
My loans have required me to work in a job that pays my bills, and in doing so have made me far more likely to grind, hustle, and to realize that if I want to feel fulfilled, I have to work for it.
Every morning I get up and go to work and every 23rd day of the month I watch as my recurring direct deposit takes a majority of my paycheck and puts it towards paying down my education. Because of my loans, I have to go to work. In going to work, I am reminded that I don’t want to do this job for the next 30 years of my life, and every day that I leave the office feeling unfulfilled, I am inspired to figure out what the fuck I do want and how to get it.
My loans are my Lambo, and in paying it down month by month, I am pushed to do more, dream bigger, and hold myself accountable.
Now, I know. This outlook isn’t perfect, there are probably numerous psychiatrists and economists alike that could poke holes in the first paragraph alone. I mean, sure, do I wish that I was actually paying off a dope Lambo instead of college debt that I am pretending is a Lambo? Probably.
That being said, this mindset is what has reversed the spiral into victimhood that I saw 22-year-old me following. I now feel agency over my situation. I feel driven to beat this corporate complacency, to continue to push myself professionally and creatively, and I feel humbled in remembering I am not deserving of a stimulating career just because I say I want it.
I can see more clearly now because I know I am not a victim of my college debt, and that every day moving forward I will harness that looming number as the fuel that will keep me pushing forward. It will remind me to hustle if I want to do what I love, even if that starts with, say, writing blog posts on the weekend.
I Victoria, am not special, my loans are a Lambo, and life is so much better because I know that. .
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CallMeVictoria
Life is messy, let's get dirty. itwasvictoria@gmail.com
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Guys, I know I rant and rave about financial collapse but I am being serious about it. I’m not the guy who is gonna start collecting canned goods and guns to fend off civil unrest but when you look at American society as a whole, we are in more debt that we can ever hope of repaying back. It’s literally impossible. This bubble will burst and it will take everything down with it. Much like the 2008 housing market crash but worse because there is an entire generation whose overall debt is $1.3trillion (student loans) before they even think about being able to buy their first asset (which is more debt on the short term) and this debt can not be wiped out with bankruptcy. As I’ve said before productivity has skyrocketed and wages have remained flat for 25 years so we are essentially not getting paid for our working output. We’re all getting fucked in the butt. Debt is what rules everything in this country. Credit is debt. Now factor in inflation and cost of living increases on top of that debt plus interest and you have millions of people sinking into a black hole they will never crawl out of. We actually are special because we will be the first generation to witness the world we grew up in be completely dissolved while also teetering on a nuclear 3rd world war. Our debt is an ICBM because it’s paying for our own destruction while propping up imperialism within countries that are emerging as global markets ahead of us in the future non-lol. Lol
Considering Im planning on buying a house in the next 3-5 years, I hope and pray for the market crash you preach of daily. Id love to buy at a bank auction while the people who have driven east coast housing prices to above housing bubble maximums consider moving to Siberia to escape debtors.
Samesies. Buy a $500k house with 3 acres for like $7.50 at auction
Already comes with a moat, snipers nests, machine gun turrets, missile silo/bunker, and dirbike with gold dirt bikes track because the apocalypse will be boring
Fuck you.
Thank you, I appreciate the kind sexual advances although I am not gay
The main difference between the market crash in 08 and what we have with student loans are quite different actually. The debt in 08 was over $10T and while $1.3T seems like a lot, it probably isn’t enough to crash the market. Another point is that in 08 the banks held all the debt whereas right now the government holds a lot of it in the loans and they won’t default on that. The likelihood is more that the credit companies will default but it won’t cause a complete disaster like in 08. A correction and scare, yes, but another 08, more than likely not.
And as a financial advisor I’m still sort of in the camp of the student debt crisis being a bubble but it really can’t be compared wholly to 08 at this point in time. But I agree with a majority of what you said. Debt is going to cripple us but eventually people are going to wake up and not go to college for $150k in debt to get an acting degree. Eventually that stuff will end when people realize it’s not realistic, and prices may adjust for that as universities lose money.
Agreed with you to an extent, but the big problem I see with the student debt bubble is that unlike the real estate crash, there’s no collateral. You could easily seize someone’s property if they defaulted on their mortgage, but what can you seize if someone defaults on their student loans? Sure 1.3 trillion vs. 10 trillion is much less, but that 1.3 trillion is basically not backed by any real, tangible assets.
Could seize our Netflix subscriptions.
You don’t pay for those, you get them either from your parents or your cousin’s boyfriend’s sister-in-law.
Can confirm
Bill, would you agree that there’s also a pro to the structure? As long as someone is paying their student loans, the loan technically should retain its value where as in the real estate crash, even people who were paying on time got screwed because the value of the underlying home fell below the outstanding Mortgage balance. Shouldn’t a lenders ability to garnish wages offset some of the risk spurred by unsecured loans?
Of course, but I think the underlying assumption is that if you default on student loans, you don’t really have much wages to garnish.
Adding to Desk Jockeys statement, there is also no physical asset behind student debt, like there is in a Mortgage. One could maybe get into an argument about the discounted value of a college degree vs how much was paid, but student loan backed securities don’t behave like Mortgage backed securities.
While I don’t doubt that our generation’s ability to spend money due to debt burden will have an impact on the global economy, it won’t create a global collapse.
If you’re worried about the risk of a systemic global crash, sovereign debt is what you should be reading about, not student loans.
Well Bill beat me to it.
Agreed. The incremental culmination of student debt, credit card debt, sub-Prime lending debt for autos and houses, and corporate debt is what i was talking about mainly but student debt is a huge burden on an entire generation that will be living through the most transient times in society which is why I used that as the focus point
I tend to agree with you here. Mainly because student loans aren’t really asset backed with any real collateral or hard asset. The major worry I have is some areas of CMBS debt, think major retail. If there is a bubble, I see it more there from what I’ve traded in the last few years.
If you are thoroughly convinced start shorting SLM or buy student loan CEBO’s contracts. Don’t disagree with you but I don’t see those going in the money in the near future.
I like your thinking. 2020 is when I think things will change especially when AI becomes more widespread in everyday use cases. I hope it can prevent a crash and be used for good but if not, the debt starts to become not only money based but human based if we can’t integrate it properly in society
Buy foreclosures and turning them into rental properties? Please and thank you.
No one at 17 can comprehend how much debt $60,000 really is and they shouldn’t be expected to. The fact that middle aged people are still out here paying their college loans instead of their kids tuition is absurd and so, so sad.
Stop looking for fulfillment from work, life becomes dramatically better. Speaking from personal experience.
My loans are a house and it still hurts.
I’m just going to pretend that my honda civic I’m almost done paying off is a Lambo.
Finally paid off my Corolla and within a week I misremembered where I parked my car. For about 12 hours I thought it was stolen and I was a mess, but no car payments is a beautiful thing
Just gotta get through these last 9 months and no more car note
College prices for non STEM degrees are a bubble that will burst once it becomes clear that you can make just as much in the trades, nursing etc. without the millstone of debt and slew of nebulous gen eds that come with most 4 year programs.
I don’t know if I’d exclude STEM degrees. Sure, something unique to them is competing with H1B visas that are due for an increase in max salary (so the foreign worker isn’t always the cheaper worker), but I’d say there’s already a glut of them in the workforce that can’t match the supply of jobs.
Should’ve put $1,000 in Bitcoin back when you started college.
I’m hoping Litecoin takes off soon
I think about this often. *sigh*
If you have a low interest rate, pay as little as possible per month. If you have a high interest rate, refinance to something lower. Do your homework and you can probably drop your rate. Put some of your earnings in the market to offset the interest expense you are paying on your debt. If your ROR in the market can equal or exceed your IR, this could help.
Right now I would advise paying as much as you can given we will not be able to write off the interest if the tax bill passes.
Is the current limit on deductible student loan interest still only 2k?
$2500 I think. Not a giant deduction, but might as well deduct what you can while you still can.
This guy’s correct, but you can only deduct if you make under $80K.
Agreed on refi – just did it for $136K and will save myself ~$200 in interest/month alone and will pay them off on the same timeline (and I get to keep my year-end bonus!)
Disagree about market investment – with market at terrifyingly record highs, unless your student loan interest in under 4%, I doubt you’ll offset with returns. Invest enough to get whatever employee match maximum you’re offered, and dump the rest on the loans.
Why do you recommend paying as little as possible? I pay more than my monthly payments because I want that debt gone as soon as possible, but I really don’t know shit about finance.
It’s a game of opportunity cost. Say your loans are at 6% interest, but if you put that money into a mutual fund or some sort of ETF, you can get 10% return. So you can then “gain” 4% because the same money spent on investing will get you more return than the cost of paying your student loans above the minimum. The theoretical financial notion goes that you should keep investing as long as the return is greater than 6% and then you can use the excess gained to pay off extra chunks of your loan if/when the rate of return dips below 6% and you stop investing.
It’s about the interest rate, not necessarily the amount of debt itself.
Stopping juggling and letting everything fall where it may is a fantasy more satisfying than any porn I could possibly imagine.
I’ve married into more debt than I know what to do with, over 90k. I was lucky and went to a dirt cheep state school and got grad school paid for. It’s very hard to articulate the pressure a payment for this puts us under. (We we’re engaged before her loans came due) But it does keep me grinding, doing under the table work as well as my corporate job. How should I inspire my other half to take the same path? Or at least not insist on 250$ “go for drinks” every weekend
Budget
deaf ears friend
Ahh. I’d recommend trying to get her to at least see where the money is going with an app like Mint. Sometimes that’s all it takes. Or you could go hardcore and do the envelope system by Dave Ramsey. But if she’s not going to listen, she’s not going to listen. Good luck.
Cut her credit card in half.
You didn’t discuss finances (her college debt) before getting married? Yikes man.
This is gonna sound sexist AF, but I would do your best to subtlety take over the managing of the money for your family and work that budget out with your financial goals. Keep her in the loop, but be firm in that the debt has to be paid down and some sacrifices need to be made for now, but you will take care of it. This means managing her spending, debt payments, raises, etc. My wife is better with money than me, so I have let her do it, but it wasn’t without some disagreements along the way. Maybe you can just offer to do it “for long term planning for the family” and hope she doesn’t want to add it to her list of duties if that makes sense.
Her loans, her payments.
Agreed. And don’t let her pull the “if you love me, you’ll help me pay them off” shtick. Check your state laws, but I believe that most states have ruled that you’re not liable for your spouse’s debts that were incurred prior to the marriage unless you’ve explicitly agreed to take them on.