Wednesday, January 21, 2009

The Cost of Education

In this article, you find out just what a calamity borrowing for education is.

Ok. So I can tell my brothers to work for the best grades possible and attend a public university on a 100% scholarship.

I can advise them that if they need loans to study independently for certain courses and CLEP them (Spanish, Algebra,'d be amazed at how many there are...).

Or I can advise them to simply choose a career that requires you to pass a test and study independently while living at home and working at Publix. Actuary, Pension planning, Insurance sales...even IT work if you pay for the Microsoft Expert courses.

But what about me? What do I tell myself now that I've accrued all that debt? What is the advice for me on how to pay it back? The best advice would have been to not get student loans. But in 2002, apparently the loaning industry hadn't been so Shylock-ish. So I have them.

What now?


SellCivilizationShort said...

That depends on your priorities. If you hate loans more than you love your prospects of a normal life, you could sacrifice your chances of a normal life to strike at the loan-givers. For example, you could flee to Hong Kong and take up a dangerous life of unregulated boxing. Or you could simply flee to Amsterdam and indulge in so many drugs that you wouldn't remember your name when the U.S. Marshals finally had you deported.

Assuming, however, that you intend to live a normal life in the country of your birth, you must deal with its legal structures. Of course, the laws do not work as advertised, and they do not administer justice equally. The well-connected get strings pulled in their favor.

And even if you flee to Africa or Antarctica but persist in using money, you will have to understand the civilized notions of money, such as interest rates and exchange rates.

So -- who are your connections? What are your resources? Which allies can be called to your cause?

Your parents and family are noteworthy allies. Are they competent investors and money managers?

SellCivilizationShort said...

Taken from an earlier post:
"Anyway, I have a math and comp sci degree (seperate and distinct degrees). Options - work for my dad in financial consultation, doing computer work for him(haven't talked to him about this yet) and also look into math tutoring with Sylvan Learning Company; continue at Lockheed Martin (yuck); continue trying to get through the actuarial exams and start actuary work; find another part time job that feels more appealing..."

And furthermore, you have a 7% rate of interest.

All right, your dad must be fairly competent with finance. You trust him. Therefore I suggest you tell him that you will be relying on his help insofar as investing goes, and you will focus your spending on your debt.

Lockheed Martin probably is the best way to squeeze cash out of the market. Therefore, I advise you to stick with it, even though it is a "yuck" job, and use all that salary to pay down the loans.

Lockheed Martin might not be willing to promote you a lot, but steady salary payments should be exploited as much as possible. I would advise you to let your husband clothe you and feed you, while your earnings go straight to debt payment.