About paying off student loans

AnnieOaklyRN, BSN, RN, EMT-P · Apr 15, 2015

I think when you are young you want to use your money for fun, not for paying back student loans, and that plays a role.

I remember wanting to spend work money on hobbies instead of bills in my early 20s, but you soon learn once the bill collectors keep calling that you cannot do that...

I also learned the value of money and paying for college, thus instead of blowing my money I earn, I save some so that I can pay for my RN-BSN as I go, instead of taking loans out, which I have successfully done thus far, and only four more classes to go!

Another problem is that kids come out of high school having learned everything, BUT financial intelligence, thus they do not understand what the consequences of having high student loan debt will be in the future. They are use to getting the name brands for clothes and other things since mommy and daddy probably help pay for it, and when they pick a college they want name brand too, and because they don't quite understand that name brand college comes at a name brand price which equates to high debt and much less money to live off of, thus when they get out and the loan bills arrive its like being hit in the face with a brick!

Annie

Libby1987 · Apr 15, 2015

My rent is currently 76% of my income. At any stage of my working life, I find this to be downright depressing. This is rent, not a mortgage, I am receiving little of value when you look at my living conditions. The only cheaper places to live are in the midst of the drugs and prostitution district. I want to move to a smoke free, adults only environment. To do that, the lowest rent exceeds my income by more than $100 a month. If this fact of life floors someone who has been around as long as I have, I can see the effect it can have on a young person just starting out.

I don't understand. Are you not working as an RN?

brandy1017, ASN, RN · Apr 15, 2015

I completely get the impossibility of paying off 200K for an expensive non marketable degree and not being able to find a job, but I'm not fully understanding the issue with paying off a moderate loan when hired after graduation.
Comparing it to my loan, I graduated with $9,500 in debt and was hired at $10.50/hr. That creeped up of course but I initially made less than 25K/year. Compared to 104K now, that was very little income.
I was the sole earner, paid my rent, had a new but modest car, paid for my two kids (didn't even have maternity benefits on the first (the health insurance industry has never been a bed of roses), had a couple of horses and still paid off my loans in 10 years.
What I don't get is the primary reason why that doesn't work the same for anyone that graduates with student debt that is roughly half of their annual income these days.
I'm sure interest plays a part, but what else?
Do people just resent having to pay them back? They're cramping the new lifestyle norm?
Can someone explain this to me? Am I being dense?

What job do you have that pays104K? Is this with salary or overtime? The average RN wage is only around $65,000 a year. Do you live in an expensive city such as LA or NYC? Seems like a high salary. I bet a lot of us would like to know your secret to such a good wage!

I graduated over 20 years ago with about $22,000 in debt, starting wage $13hr and it's taken me 23 years to pay back, granted I put it in deferment/forbearance at times and then consolidated when I bought my house. The payments were almost $350 a month back then and the interest rates were very high at the time 10/12% on one and 12/14% on the other. When I consolidated I was only down to 15,000 after ten years and the interest rates had fallen to 5.25%. I know others who consolidated when rates were 9% and were stuck at that because you can only consolidate or refi your student loans once and then you are stuck with that rate even if rates go lower. The new loan payment was only $121 a month, but it was for 15 years after I had already had the loan for ten years! I tried to pay extra, but with a mortgage it was hard to do. I find my job basically too stressful to do overtime. I did overtime the year I bought the house and after that I gave up and I think working conditions were easier back then as we had more staffing than now. Working conditions have just gotten worse over the years and the patients are sicker than ever!

I know several new grads with around $100,000 in student loans either because they went to an expensive private school or went back to school for nursing when their first degree was a dud! I'm glad I'm not in their shoes! I don't think I could sleep at night. I'm amazed how much student loans some people are willing to take out for their "dream", sky's the limit, seemingly no thought as to how difficult and how long it will be to pay back. Then when people ask advice to go back to school for nursing and they are already carrying over $50,000 in debt they get mad at you for suggesting it isn't a good idea and pointing out the dangers of student loans. I would personally be glad that someone warned me about all the pitfalls of student loans. Back when I took loans out I was totally clueless and had no idea about all the dangers if I didn't pay the loans off. Such as no bankruptcy options, the high cost of default, wage garnishment, social security garnishment and even taking away your license to practice, or if you have a health loan taking away your ability to bill medicare patients! I think people should be told all these legal consequences before they sign on the bottom line!

Libby1987 · Apr 15, 2015

What job do you have that pays104K? Is this with salary or overtime? The average RN wage is only around $65,000 a year.

Home Health in California. I work hard but I'm M-F days.

Wages start in the low 40's/hr. The 100K ceiling was broke years ago.

dirtyhippiegirl, BSN, RN · Apr 15, 2015

I wish there was more transparency within the education system about *realistic* opportunities for employment post-graduation, salary levels, student loans, etc. Personal finance classes should be mandatory for high school seniors and they should touch upon how student loans work, how credit cards work, etc.

After my sister failed to get into rad tech school, she went to see a career counselor through the community college she was graduating from to determine what she should do next. The counselor had her take a survey that would help determine my sister's interests and thus what degree she should get. I don't know what was actually said to my sister but the way my sister interpreted the meeting with the counselor was that the test she took said she would be good at and like a job being a museum curator, so now she needed a bachelor's in history. Nothing was said about the employment rates of history majors or museum curators or the average amount of education needed to be a museum curator -- and that bothers me because my sister went to the school for career guidance and left with half-truths and meaningless information...

Libby1987 · Apr 15, 2015

I wonder where the parents are. My kids have been hearing from me about the downfalls of the student loans for years and we're paying cash as we go. My daughter is working towards PT and if/when she works her way into the PT program, then we'll get a loan to finish her off. I know my company would jump at hiring her at 120K/yr, that would a good investment. My boys are looking at the trades where their dad has made a good living, won't be taking out loans there either unless very minimal.

A whole nother topic is parents having kids with no plan to get them educated and/or trained in a marketable field.

brandy1017, ASN, RN · Apr 15, 2015

Home Health in California. I work hard but I'm M-F days.
Wages start in the low 40's/hr. The 100K ceiling was broke years ago.

Are you salary then? I was under the impression that home health pays piecemeal ie a flat fee per case where your experience didn't matter and everyone was basically getting the same pay.

SweetPotatoes · Apr 15, 2015

Interesting. I have a bachelor's from a university that was 50k/year and I don't have any debt. My mother drilled into my head the importance of financial solvency. As result, I applied to schools with scholarship programs...I was also a hard worker and high achieving, so I was offered significant amounts of merit aid for every school to which I was accepted. I was blessed in that regard. I am only in my mid twenties but I have noticed that my peers don't have the same view on loans as I do. I couldn't understand how my friends could sleep at night knowing they were living off 100k in loans for tuition and room and board. Meanwhile, I was hustling to pay for the remainder of room and board that was not covered by scholarships. I applied for (and got) internships and jobs that paid a lot and was able to live comfortably (e.g., eating real food and not Ramen lol and purchasing books and clothes, and even being able to provide for others with less than I had). I had a 2k loan but that was paid off the year after graduation. I was terrified of loans so I tried to do all I could to avoid significant ones. I REALLY don't understand how people go to college without knowing what loans and interests are...I don't understand...but I guess if you didn't have people explaining it to you, you wouldn't know. Does Dave Ramsey (or somebody) have a program for high schoolers? Something that can travel country wide and provide seminars to juniors and seniors at no cost to the schools? Because this debt issue is a problem.

Now that I am going for my second bachelor's, I am looking at having to acquire debt. The aid for 2nd Bachelor's is scanty and and a lot of nursing scholarships from the state have diminished. My plan is to keep everything under 20k by the time I graduate. I will most certainly be working part time once I get a handle on school and I'll have to live frugally but my parents are willing to let me stay with them so I am grateful. I'll be paying them something out of my savings, but it will be cheaper than living on my own.

So to answer the question, in my past life, I would have run away from loans lol. But now I am ok with getting a small amount. I think that people need to know what they are getting themselves into! That's the issue. I know what loans and interest mean. Whenever I talk to younger students about school, I always stress the money thing to them. Unfortunately, my peers are into wanting things now and don't think about the future a lot. I certainly plan to have a family and I need to be able to care for my parents in the future, so I want people to consider all these things when it comes to making big decisions about money.

brandy1017, ASN, RN · Apr 15, 2015

Interesting. I have a bachelor's from a university that was 50k/year and I don't have any debt. My mother drilled into my head the importance of financial solvency. As result, I applied to schools with scholarship programs...I was also a hard worker and high achieving, so I was offered significant amounts of merit aid for every school to which I was accepted. I was blessed in that regard. I am only in my mid twenties but I have noticed that my peers don't have the same view on loans as I do. I couldn't understand how my friends could sleep at night knowing they were living off 100k in loans for tuition and room and board. Meanwhile, I was hustling to pay for the remainder of room and board that was not covered by scholarships. I applied for (and got) internships and jobs that paid a lot and was able to live comfortably (e.g., eating real food and not Ramen lol and purchasing books and clothes, and even being able to provide for others with less than I had). I had a 2k loan but that was paid off the year after graduation. I was terrified of loans so I tried to do all I could to avoid significant ones. I REALLY don't understand how people go to college without knowing what loans and interests are...I don't understand...but I guess if you didn't have people explaining it to you, you wouldn't know. Does Dave Ramsey (or somebody) have a program for high schoolers? Something that can travel country wide and provide seminars to juniors and seniors at no cost to the schools? Because this debt issue is a problem.
Now that I am going for my second bachelor's, I am looking at having to acquire debt. The aid for 2nd Bachelor's is scanty and and a lot of nursing scholarships from the state have diminished. My plan is to keep everything under 20k by the time I graduate. I will most certainly be working part time once I get a handle on school and I'll have to live frugally but my parents are willing to let me stay with them so I am grateful. I'll be paying them something out of my savings, but it will be cheaper than living on my own.
So to answer the question, in my past life, I would have run away from loans lol. But now I am ok with getting a small amount. I think that people need to know what they are getting themselves into! That's the issue. I know what loans and interest mean. Whenever I talk to younger students about school, I always stress the money thing to them. Unfortunately, my peers are into wanting things now and don't think about the future a lot. I certainly plan to have a family and I need to be able to care for my parents in the future, so I want people to consider all these things when it comes to making big decisions about money.

What college did you go to and what did you major in? Were you able to get a good job with it? What field are you in? It seems many people have a liberal arts degree that gets them nowhere and then they go back to school for nursing.

SweetPotatoes · Apr 16, 2015

What college did you go to and what did you major in? Were you able to get a good job with it? What field are you in? It seems many people have a liberal arts degree that gets them nowhere and then they go back to school for nursing.

I went to JHU and got a degree in Public Health Studies, and have been doing community work for 3 years. Good jobs? Yes, in terms of experience...no, in terms of money. I mean, if I stayed working for a few more years, I am certain I could work my way up to a manager position, or even do some great research.

But I always planned to get another degree. These days, there's no use in remaining at a Bachelor's level unfortunately unless it's something like nursing, computer science, or engineering, to name a few. Even "hard science" degrees like physics, chemistry, biology, etc require upper degrees to make a decent living, and a lot of my peers found this out the hard way. Almost everyone from my school went on to higher education, unless they were an engineer or computer person.

I plan to do public health nursing, so I am super excited for that :) However, the last thing I thought about with nursing was salary because I knew how rough the field has been lately. I actually was accepted to great MPH programs but turned them down because I realized I wouldn't be passionate, like I am about nursing. My stepfather says I should have done nursing out of high school, but we all know that it's not a field for everyone at every time. I shudder at the thought of a 19 year old me in nursing school. I'm mature now and I know how I want to work things out careerwise.

It seems like we have to get Bachelor's now, not for jobs, but for higher education that will get us jobs. With the exception of the aforementioned more employable fields, for lack of a better phrase.

So since I have no loans from my undergrad, I'm more at ease without having to take some out for nursing.

joanna73, BSN, RN · Apr 16, 2015

Long before I accepted the loans, I wrote out a budget. I figured out where I could cut costs, how much savings I had, and how often I would need to work.

Many people do not know how much they spend, nor are they willing to sacrifice anything. Cost of living is much higher including the cost of education, but the principles of budgeting are the same: differentiate between needs and wants, and live within your means.

Jules A, MSN · Apr 16, 2015

Many people do not know how much they spend, nor are they willing to sacrifice anything. Cost of living is much higher including the cost of education, but the principles of budgeting are the same: differentiate between needs and wants, and live within your means.

Change a few key words and this is how I manage my diet also.