Debt.. Jobs.. Education Options

[stephen_lee]

I'm now 18, as of February 2nd, and I see my mother, sister, brother, and even grandparents in debt. I'm truly afraid of owing any money aside from buying a house. As of now I probably won't even buy a car unless I have the cash for it. Once in the last two years have I ever been in the negative. The only reason that happened was because, when i worked at Little Caesars, my pay check had bounced, so they took around $490 out of my account w/o any notice throwing me -$19 and then the $31 overdraft fee. I talked to my employer though, and got $670 back. A nice gain of $149 after the fees. But in all honestly it was.. quite bone chilling seeing that "-" on my account. Anyway, i now work at AutoZone, with a chance to work building engines for an oil drilling company starting at $12/hour while average wage is $35/hour. But then again, I'm really good w/ computers and am already a certified tech. So I think I'll be fine as I have something to fal back on no matter which way I choose to go. I know one will be a great choice in the long run, and I will have great Job security. The other, though, will start paying off much quicker, but not as much in the end, with less security. But the former requiring college and therefore debt since I don't have the cash to pay for it as of now. *sarcasm* I love decisions...

[Hanyo]

The only way to be certain that you never get into debt is to have a ton of money to fall back on and have a great job that you never require you to dip into your savings. The reason for this is because anything can make you get into serious debt, such as an injury that prevents you from work and a giant medical bill; or your house burns down leaving you with nothing.

Debt should not come into consideration when it comes to what you want to do in life. If you like to do something and passionate about it, don’t let something as debt get in you way of your goals. Because, ultimately people who like what they do for a living and are good at it; will always make big bucks.

The worst case scenario is to get an education in something you don’t like and you suck at it preventing you from getting paid well. The little money you make will be barely enough to cover current expenses let alone pay back college debt. In the end it boils down to a wager whether or not you have confidence in yourself to pursue your goal.

[stephen_lee]

But I love both engines and computers, and I'm great at both
Best thing to do I assume is to build motors to pay for college, then get a job as a computer tech after I get a degree.

[Hanyo]

But I love both engines and computers, and I'm great at both
Best thing to do I assume is to build motors to pay for college, then get a job as a computer tech after I get a degree.

here is a problem with your plan, if you build engines during college part time you will be getting a ton of experience in that field. So when you get out of college with a computer degree you will have less experience in computer career field and will make it dificult to find a job.

Best way to aproach it is to get a career in college to help you find a job and pad your resume. DON'T get in the assumption that once you get your degree it will be smooth sailing. The easy part was the school, finding a job that will give you the opportunity to grow and pay well is the most difficult part.

you said your good with computer tech. I'm assuming you want a computer science major? Or do you plan on getting a computer technology related certificate?

[speedfeen]

With debt now a days.....its more common than most ppl think....the same thing with bankruptcy...


its going to happen...a house, a car....either way its some sort of debt...its barely avoidable...


you have to do what your heart wants....TAKE CHANCES!!! Dont live life well if this and if that....just jump on what you want and try it! You do that and you not as regretfull as you would of been of you didnt try it. Life is all about decisions!! anyways im getting a bit busier at work so if i missed anything ill add to it later


feen

[Rayme]

When it comes to debts, there are good ones and bad ones.

House and cars are good one, you can get money back and sell either in case of emergency. (if its a new car though, the depreciation will bite you bad, its better to buy some years older cars).

Credit cards and students loan debts are the devil x999, they will bite you for a long time.

If you really want to go to college, get a part time job while you're there (I know its hard), or do like me, get a job and stay with your parent for free and save money to go to college, I did that one year and saved up 10 000$, its hard but so much worth it when you have 10 000$ less to repay.

[ILuvMyCelica95]

I would do whatever is going to helpful to you in the long run. Don't take a job now just because it pays good and GO TO SCHOOL.

I have a job now that 4 years ago seemed like a good idea. Nice pay and easy. 4 years later the pay is the same; no raises and there is NO where to go from here. I went back to school to get a degree towards what i do. The only way for me to expand on my knowledge of my job is to find a new one in the same field... a field mind you that i don't LOVE. I dug a pretty big hole for myself and i'm making the best of it. You don't want to do that. I'm 23 and i hate my job already. I should have stayed with what i originally wanted to do in school and i'd be a happy music teacher right now instead of a underpaid unhappy paralegal.

[Random_Stranger]

^x2


The last thing you want is to get stuck in the real world with a job that pays good, but you have grown to hate. Going to school can give you a chance to find out what you really want out of life and be proficient in it, and that degree will be valid so long as you live. My friend Chris did pretty good for not going to school. Got a job at the Nestle Factory here and made $45k a year (Eventually). 4 years later, he began to have trouble with his knee. Now he has been out of work for over a year and not even sure if his job will have him back once he has recovered from knee surgery. They have fired so many people for people in Los Angeles from another plant since Dryer's stepped in for a bit and took over as part of their ending contract before they completely sell out to Nestle.

Had he gone to school, he could look for another place to work making the same if not more. But he has nothing to fall back on. Now he will probably have to take a job that pays minimum wage. Be smart kid. Go back to school, if you need money, take an easy part time job, but focus on school. You will find that it will be the best thing you ever did. Our generation and generations to come cannot afford to NOT go to school. High school diploma isn't good for us anymore like it was our parents.

There was a time where the house you could afford was based off of how much you made. So if you made $10k per year, your house costs $10k. Now, the dream of having a house wife is almost completely ruined as it now takes two incomes just to get a home.

[GriffGirl]

The statement above about student loans being the devil is simply untrue. Living beyond your means - i.e., credit cards, now those are the devil. But an investment at a low interest rate to get an education is not only a wise investment and money well spent, your loan payments are tax deductible.

FAFSA is the first way to go (Federal Aid) - unfortunately (or fortunately depending on your situation) it will be ENTIRELY contingent on your parent's income until you are 23. The government doesn't care if you work or support yourself. You can appeal decisions if you are denied aid but are independent if you file your own taxes as head of household. This is how I was able to make it through college on the tail of the first Bush administration, when getting aid was MUCH more difficult. Clinton revamped everything, and made it easier. It's still that way now.

Now if your parents don't make much, if you have younger siblings, or live with a single parent who claimed you as a dependent on their 2007 taxes, your odds of getting Federal aid increase dramatically. Federal aid does not always equal loans. It starts out with the Pell Grant, I think there are a few other little grants too, which are small but if you go to a community college can easily pay for a year of it, including books and supplies. Next you're looking at the Stafford Loan, which is a Federally guaranteed (the Fed guarantee the loan to the actual lender, typically Sallie Mae or whatever mega financial corporation it is these days) and given to you at a low, typically variable rate. I believe it's around 4%. Your payments are not due until 6 months after graduation or withdrawal from college, whichever comes first. You can go all the way to your Doctorate without having to make payments, just so long as you're in school. And if you're unemployed and can't make the payments after that 6 months, you will be eligible for NUMEROUS deferments and even forbearance if it goes that far (that takes a few years).

You have options, and honestly, the investment in your own future is probably the best investment you can ever make in yourself. Go talk to a financial aid counselor at a school you're interested in. There are all kinds of scholarships available, grants, etc. in addition to FAFSA. A financial aid counselor can advise you of your best options.

[Rayme]

Eh tax deductable? I got barely 300$ out of the 1200$ I paied in INTEREST last year, that's not very helpful.
However you want to put it, student loans are bad, the interests rate are higher than a mortgage for the same amount of time.
The banks/government are banking big time on giving out huge loans to kids that don't know for sure what they want to do with their study. The interest rates should be extremely low.

I agree that it should be seen as an investment in your future, but the truth is when people are 17, they often make bad choice because they are just young, it happened to me and to, sadly, the majority of my friends. I have 4 years of college(3 different courses) and I'm getting paied under 15 bucks an hour. Bad decisions? Maybe, but its bound to happen to the majority of people to take more than 1 different field of study and just accumulate student debts. And my case is not very different than alot of people. Not everybody gets 20$+/hours jobs when they are out of college.

Maybe I should re-phrase, they are a often necessary evil.

The statement above about student loans being the devil is simply untrue. Living beyond your means - i.e., credit cards, now those are the devil. But an investment at a low interest rate to get an education is not only a wise investment and money well spent, your loan payments are tax deductible.

FAFSA is the first way to go (Federal Aid) - unfortunately (or fortunately depending on your situation) it will be ENTIRELY contingent on your parent's income until you are 23. The government doesn't care if you work or support yourself. You can appeal decisions if you are denied aid but are independent if you file your own taxes as head of household. This is how I was able to make it through college on the tail of the first Bush administration, when getting aid was MUCH more difficult. Clinton revamped everything, and made it easier. It's still that way now.

Now if your parents don't make much, if you have younger siblings, or live with a single parent who claimed you as a dependent on their 2007 taxes, your odds of getting Federal aid increase dramatically. Federal aid does not always equal loans. It starts out with the Pell Grant, I think there are a few other little grants too, which are small but if you go to a community college can easily pay for a year of it, including books and supplies. Next you're looking at the Stafford Loan, which is a Federally guaranteed (the Fed guarantee the loan to the actual lender, typically Sallie Mae or whatever mega financial corporation it is these days) and given to you at a low, typically variable rate. I believe it's around 4%. Your payments are not due until 6 months after graduation or withdrawal from college, whichever comes first. You can go all the way to your Doctorate without having to make payments, just so long as you're in school. And if you're unemployed and can't make the payments after that 6 months, you will be eligible for NUMEROUS deferments and even forbearance if it goes that far (that takes a few years).

You have options, and honestly, the investment in your own future is probably the best investment you can ever make in yourself. Go talk to a financial aid counselor at a school you're interested in. There are all kinds of scholarships available, grants, etc. in addition to FAFSA. A financial aid counselor can advise you of your best options.

This post has been edited by Rayme: Mar 17, 2008 - 2:03 PM

[GriffGirl]

Maybe in Canada, that's the case, but in the US the payments are tax deductible, the interest is tax deductible, and yeah, if you have perfect credit the interest rate is higher than a mortgage loan, but unless you're going to medical school or taking out a mortgage on a mobile home or a trailer, the cost of an education is WAY less than a house. How old are you anyway, just out of curiosity? You're information is either way wrong or it's just WAY different in Canada.

[Rayme]

I'm 26, and last time I check my student loan interest, it was 8.* %.
My mini home mortgage is 5.*%.

They state our interest rate is deductable, but it's just another "credit" field on the tax form, you barely get 25% of what you paid in interest.

As of now, 40$ of my 150$/monthly payment goes on the capital, somebody is cashing in on my mistakes. I think it's a crime, and my loan is waaay smaller than some of my friends who are at 60 000$ - 80 000$.

And ask anyone around who are still paying their loan, I'm pretty sure everybody will say, they are indeed evil, they are like ball chain that even bankrupty doesn't erase. I'm ranting right now but I'm sure I'm talking for alot of people. That being said I'm not saying NO don't go to school, I would highly advise anyone to invest into going into post-secondary education, but it's just a sad fact that the interest rates (here at least) are so unbeleivably high.

EDIT : I was wrong, I checked my interest rate and it was 7.75 %, floating.

This post has been edited by Rayme: Mar 17, 2008 - 4:40 PM

[GriffGirl]

I am still paying my loan... and probably will be for the next ten years. I'm paying for my mistakes too, don't get me wrong... but my mistakes were in not staying on top of it, not the fact that I got the loans in the first place. And as a part of paying for my mistakes, I still don't own a house, I rent one. (and I've got 8 years on ya!)

The whole debt concern is TOTALLY such a valid concern, and I don't mean to knock it in any way if that's how it seemed. I made some bad financial choices when I was younger, and I'm paying for them now. So I can honestly say, with experience, that Yes, the student loan is a worthwhile investment (if you're gonna use your degree! Which I do, daily). Yes, debt SUCKS but you can start off on the right foot and it will help you establish credit to buy that house some day. Just be diligent and attentive, and it won't bring you to your knees.

[JoKeRkId613]

i think you're worrying too much. it's not that serious. im 20, dont have mommy and daddy helping me out and im down pretty well. i see so many young people at our company living paycheck to paycheck. as long as you know how to save and prioritize, that should not be a problem. i know some will argue that, but i wont agree. if you're a healthy person, you can make it work so you're never in the negative.

go to a strip club and make it rain.

[Rayme]

i think you're worrying too much. it's not that serious. im 20, dont have mommy and daddy helping me out and im down pretty well. i see so many young people at our company living paycheck to paycheck. as long as you know how to save and prioritize, that should not be a problem. i know some will argue that, but i wont agree. if you're a healthy person, you can make it work so you're never in the negative.

go to a strip club and make it rain.

I know a thing or two, as I somewhat mentionned in my "wedding ring" thread, I paied by myself 5000$ of credit card debts in the last 18 months, I know how to prioritize things and sacrifice myself, I do sound like I'm whinning but its sad to realize things when its too late, but we learn by our mistake no?

I just want to say to the original poster, to take education seriously.

I'm stuk with a job I love that pays somewhat squat! (damn arts)

[JoKeRkId613]

im in the adult film industry and i love it. seriously. then i got my 9 to 5 on weekdays (havent banked nice enough to leave that one yet as i just got into the game a little while ago).

This post has been edited by JoKeRkId613: Mar 17, 2008 - 7:38 PM

[Random_Stranger]

I didn't read everything like I probably should have. But I used to work at a call center for student loans (pretty much calling people who are delinquent and sometimes getting calls from people who wanted to remedy their situation). It has been a long time, and can't remember if it were Stafford Subsidized loans (I think it was) that allowed you to have no interest so long as you were in school half time status or more, were temporarily disabled, or unemployed (With Proof! Like collecting unemployment). That's usually the way to go there. But when you are young, they tend to make the parents come up with the rest with a Parent Plus Loan. I forgot what else I was going to add, because I got distracted like 20 minutes ago. But yeah.

[xs94st]

u can defer payment for some school loans for up to 6 months after graduation, maybe more, maybe less.

i'm being ownd by my loans right now. went to school for 1 year at a university and that cost a pretty 17grand. luckily i only have about 8grand in loans, but work is shiite right now and i am in a horrible debt situation. no help from my pops or any1 else.

hell, if my family had it their way, i'd be giving them a majority of my paycheck, and i'm turning 21 this year.

just, don't dig yourself a hole u can't get out of. it'll fill with shiite faster than you can imagine.

[ILuvMyCelica95]

My Student loans are at a 4% rate because i consolidated. I would suggest doing that to anyone who has a high interest rate. All payments made are tax deductible in the US.

I would suggest MyFico.com check your score and with a free 30 day trial of Score Watch it will tell you what you can do to lower your score and improve your credit.

[Random_Stranger]

Also, as mentioned you can defer (Deferment) your loans if you have a subsidized loan. Unsubsidized, I believe it still includes interest. Then you have three different payment options (I forgot the proper terms for them) but I know one is the fastest which should have you paid off in 5 years (or you can pay more, pretty much whatever profession you go into, if you get a good job, the 10 years total in what you owe, usually equals out to what you should make in a year). I forgot what the other plans offer and how long you should be paid up, but those of course will have more interest.

If you can't make your payments, you have those options of Deferment or Forbearance. What's the difference? Deferment needs certain qualifications to not allow interest to be added, plus I think it also has to be a subsidized loan. Forbearance is a temporary hold on payments, though interest will still accrue. Trust me, when I was working for Fafsa, we breathe, ate, and slept all this information. We honestly didn't even know what the hell we were talking about, just putting out information that we were told like a robot. Hope we all helped you.

You really can't put a price on education though......... or can you?


\EDIT: I think the plans are 5 years, 10 years, and 15+ years.

This post has been edited by Random_Stranger: Mar 18, 2008 - 3:26 PM

[soulshadow]

Glad Im not the only one working at Autozone. That company sure as heck starting to piss me off. Anyways, The economy is going into a downfall about now So its pretty hard to find a good job where u wont get laid off. If your good with computers I would say stick to it. Because that is where the future is going. Cars are becoming more of a thing of the pass and Technology will lead the way to the future. Today you can find more people demanding that there computers be fixed so they can surf the Net, than People who wants there car fixed.