Debts are the Whips and Shackles That Will Enslave You

[KeepItRealRN]

1. The truth out there is that for the most part with rare exceptions, Hospitals don't care where you went to school. Taking out tens of thousands of dollars in student loan debt to get a "designer" degree will not make you more competetive. It will however limit your opportunities because you have to generate a siginificant cash flow in order to pay off your debt.

2. When you do finally land your first job it most likely won't be the one you want. We all have to start somewhere to get our "foot in the door". When you have big debt you don't have the luxury of being able to be "between jobs". You will need to keep your crappy job no matter how much it sucks unless you have another one lined up and ready to go. Being without a paycheck even for a couple of weeks is not an option.

3. Big debt puts you in a position where you must "put up" with conditions you might not otherwise be willing to put up with because you can not afford to lose your job.

4. Money has been described as the "root of all evil", but the fact is that in our society (money=freedom). If you don't have it, or worse yet if you owe it to someone, then you are being controled.

Having said all of this, your outlook on life in general will be much improved when you go to your job because you "choose to" rather than "have to". I'm not saying that I am independently wealthy by any means. I have to work to live like everyone else but I do it on my terms.

Think about this, a lot of us before school worked jobs that didn't pay nearly as much as nursing and we got by OK. We did however had to work full time and then some to make ends meet. If you stay out of debt, you can make the same amount of money working a minimal amount of hours. This affords you to have a large quantity of something that is simply priceless and that is "time".

There are 3 types of poverty in this life and they are

1. Poverty of cash

2. Poverty of time

3. Poverty of the soul.

Solving "poverty of cash" by living in "poverty of time" is not a good trade off. We are all given a limited amount of time here on earth. When we work we are basically selling our time. I don't know about you but my time is priceless to me and I will only sell it to the highest bidder on my terms. However this is only possible if you plan it that way and stay out of debt.

[prayin 2 b a rn]

I have the option of getting my BSN in a university and having to take out loans to attend or getting my RN in my local community college and than going for my RN to BSN. Yes its going to take a little bit longer (like 6 more months) to go through the community college route but at the end i will have no dept.

[TheCommuter, BSN, RN]

And they are creating a college bubble in much the same way they created a housing bubble. The truth is when it all comes out people are going to start defaulting on their student loans left and right.

I absolutely agree with you on your assertion that a college bubble is forming. We had a real estate bubble that started to burst a few years ago. I'm convinced that we are now in the midst of a student loan bubble that will burst before the end of this decade.

http://www.qando.net/?p=10821

You might have read one of the increasingly frequent stories about a student loan bubble. The basics:

-College is widely believed to be the ticket to success. Degree-holders are more likely to be employed and they make more income than non-holders.

-Many people tried to take refuge from a lousy job market by going to college, and the recession also pinched state budgets, forcing schools to raise tuition.

-Consequently, the amount of student loan debt has exploded toward $1 trillion, eclipsing even consumer credit. Since student loan debt is impossible to discharge even in bankruptcy, it was widely considered safe for lenders, and was securitized much in the same fashion as mortgages.

-As punishing as the rules for paying student loans are, those saddled with the debt have been unable to pay--many fresh graduates aren't competitive candidates for still-scarce jobs. Only 40% of student loans are being actively repaid. So lenders are starting to pull out.

Over the longer term, the growth in college costs has far outpaced inflation for decades ("Since 1978, the price of tuition at US colleges has increased over 900 percent, 650 points above inflation"), while the added-income value of those degrees has not grown at nearly the same pace. The oft-quoted statistic that college graduates make $1 million more over a lifetime is misleading (it doesn't take into account years of foregone income, for one thing), and there's reason to suspect that much of the real discrepancy is due to correlation: students who have what it takes to pass through the filter of college admissions and stick it out are likely the kind of people who would make more money over their lifetimes anyway.

But is that enough to call it a bubble?

[linearthinker, DNP, RN]

That is if the amount of borrowed money is reasonable. No BSN is worth the equivalent of a mortgage. Designer degrees are a racket. In the big picture one BSN is no better than another BSN. Some just cost more.

I think this is not entirely true. It depends what you want out of your career.

If you want something outside of the typical RN "job," a position of some influence, then the name on that degree and the connections one makes while earning it, are worth the price ten fold. Do you aspire to be the Director of HHS, NIH or a Dean of Nursing at Yale School of Nursing? Then you bloody well had better go to Yale or the like, lol.

[SharonH, RN]

While I agree wholeheartedly with your position on debt, I detour from the idea that "smart" nurses go the community college route (my words-I'm paraphrasing). I was a traditional college student, choosing to go for my BSN straight out of school. The piecemeal approach was not an option for me and my position on that has not changed over the past 20 years. My experience with grad school (trying to work, have a family and complete school) only affirmed that. It was important to me to get it over with so I could get back to my real life!

I say this to say that I can understand those who choose a private school rather than wait for a spot at a public school. What are you supposed to do to earn a decent living while you are waiting for a spot? That's lost income also. Additionally a few people made a point about career goals for your degree. Not all of us aspire to just "get a job". And for those folks, I think it's a fine idea to mull all your options include the "foo-foo" private schools.

There are multiple ways to get anything done. You don't have to only go to community college to avoid massive debt while in school. I think the attitude that there is only one way to do things is what enslaves us. 100K is a lot of money but it does not have to be a lifetime commitment. You can take out loans but take out only what you absolutely need. Look for scholarships. I earned one in grad school simply because nobody else applied (had to give it back because I was only part-time). Decrease your standard of living in school and work weekends to decrease or avoid debt. After school, pay down the debt as much as possible and then transfer it to a 0% credit card. Patch your car together for one more year. Get a Tracfone. Hold off on that cruise. Supplement your pay with prn work and you can be free of a large amount of debt quicker than you think. I speak from experience.

[SharonH, RN]

You know what's sad is that it's not the big things like college tuition that keep people poor but it's the foolish things that people waste money on:

1. Cable TV

2. Expensive cellphone packages

3. Not shopping around for home/auto/life insurance; paying low deductibles

4. Eating out

5. Gym clubs and other types of memberships

6. Wasting money on nick-nacks and chotskies(you'd be surprised)

7. Shopping at Walmart and dollar stores-absolute money wasters

8. Late fees and other types of avoidable fees, high interest rates

I bet if people took a good hard look at how they were spending on those items, a large student loan payment would pale in comparison.

[Not_A_Hat_Person, RN]

You know what's sad is that it's not the big things like college tuition that keep people poor but it's the foolish things that people waste money on:

7. Shopping at Walmart and dollar stores-absolute money wasters

I bet if people took a good hard look at how they were spending on those items, a large student loan payment would pale in comparison.

So people should avoid poverty by paying more for shampoo, toilet paper, spices, detergent, OTC meds (Dollar Tree sells motrin) and other staples?

[TheCommuter, BSN, RN]

So people should avoid poverty by paying more for shampoo, toilet paper, spices, detergent, OTC meds (Dollar Tree sells motrin) and other staples?

Although I shop at Wal-Mart and dollar stores, I somewhat see Sharon's point. Since I used to work at a dollar store many years ago, I know that these places make the bulk of their profits off the impulse purchases that people make: figurines, costume jewelry, picture frames that you don't need, candle holders, flower vases, and so forth.

Most shoppers visit the dollar store to stock up on necessities such as cleaning products, personal care items, and dry groceries, but they end up leaving with a few impulse purchases (after all, it only cost a dollar). You know what they say: a bargain is something you cannot use at a price you cannot refuse!

Wal-Mart is also filled with impulse buys.

[pedicurn, LPN, RN]

So people should avoid poverty by paying more for shampoo, toilet paper, spices, detergent, OTC meds (Dollar Tree sells motrin) and other staples?

Frequently when I buy something very inexpensive it doesn't last very long. Occasionally I 'll hit on a bargain.

I have never ever bought a bargain with an inexpensive pair of shoes .... they don't last, don't stay looking nice for very long and never make my feet feel as comfortable as the more expensive shoes. Used to buy the cheapest toilet paper and shampoo ....but we seem to always use more of it. So now I buy the better quality stuff when it's on sale. Expensive shampoo seems to last for ages.

I only buy the cheap dollar store stuff for things I know will last eg plastic bowls.

Otherwise when I have to replace something x3 or x5 times a year ?

I could have bought the quality item (on sale) and never replace it for several years.

And there's also the joy from using a better designed and nicer looking product.

Just saying ....I usually regret my dollar store purchases because IMHO they almost never work out to be bargains

[RNperdiem, RN]

Sharon H, RN, I agree that the above things can be money drains, but there is an important difference between those and student loans.

Cable TV can be cancelled at any time, there is no lasting commitment involved.

Student loans are cannot just be dropped from your budget like restaurant meals if finances are tight.

[joanna73, BSN, RN]

I'm not sure how it works in the US, but in Canada, you can no longer default on student loans. You will pay that money until you die, which is why I would be very hesitant to borrow any more than I need. The government will ruin your credit, and the loan balance will be garnished from your wage. They got wise to people claiming bankruptcy years ago and cut that option for student loans.

I also agree with living within my means. If you have debt, the fancy extras shouldn't exist. Many people do not budget, and these same people wonder why their debt keeps mounting.

[TheCommuter, BSN, RN]

I'm not sure how it works in the US, but in Canada, you can no longer default on student loans.

It is the same story here in the U.S. Government student loans cannot be discharged in bankruptcy, so student loan debt will remain with a person until it is paid off or they die (whichever comes first). Although you can default on your student loans here in the States, the tradeoff is that your wages will be garnished, and your Social Security retirement benefits will be taken away.

This is why I cringe when some people on these forums seem to have a blase, unconcerned attitude toward $100,000+ worth of student loan debt.

[rn/writer, RN]

I cringe when some people on these forums seem to have a blase, unconcerned attitude toward $100,000+ worth of student loan debt.

This may, in part, have its roots in direct deposit, online banking, debit cards, online gaming and the like. It can seem like Monopoly money. If people had to look at a pile of actual cash equal to their proposed debt, it might seem much less virtual and a lot more scary.