Student Loan Debt. Where do you draw the line?

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Specializes in Hospice / Ambulatory Clinic.

I'm pulling this discussion over from another non nursing board that I'm active on because it is relavant to some points I am trying to unsuccessfully make. In particular the amount of student loan debt one is willing to take on for an education.'

What $200,000 in Student Debt Looks Like

In the interest of transparency I do attend a private school but it meets some needs and goals for me other than just the subject of study. However I feel the amount of debt I will end up in to be reasonable.

This article caught my eye as it about a student that got into $200,000 in student loan debt for a Bachelors degree that has no real market value. Her average monthly payment for the next 155 months ( 13 years) is $2,300

It shows how much she owes and how much her monthly payments are. She actually only took out $170k in loans 30k alone is interest over 4 years

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I don't know how much is too much. I think it would depend on what is being studied. If I'm studying to become a Cardiologist, who probably makes about $250,00 per year, then I could see loans adding up to $200,000.

I'm thinking that student loans should equal no more than the lowest salary you would start off making per year as a graduate.

Of course, no student loan is always better, but not always an option.

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That's awful! That woman's life is ruined before it even started. I've only heard of law and med school graduates with that kind of debt. What was her major? I have student loan debt but thank goodness that my payments are reasonable and I can easily make them on my current salary. Even so, I still hate to give up the money every month to make those payments. It's very depressing to think of all the life experiences this young woman will miss out on because she's been made (through her own doing and ignorance) a debt slave at the age of 23.

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Specializes in Hospice / Ambulatory Clinic.

I believe this students degree was in something non specific.

I can understand med students being in so much debt because they are in school for such a lng time 8 plus years.

But $200k for a 4 year degree?

My personal line is to not take out more student loan debt that my career would earn in a year. That figure being based on a worse case earning senario.

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Specializes in ICU.

The answer is simple - too much is when the monthly payment you can expect exceeds 20% of your projected post-graduate income.

There are a few problems with that "picture".

1. That particular student grossly over-borrowed. Period. She was either never required to complete debt counseling before borrowing or she did and took none of the advice to heart. The general rule of thumb is to never borrow more than you need. It is possible to work while attending college full time. In fact, there are Federal grants that are designed specifically for that purpose. It's called the Federal Work Study program. The income earned from Work Study could have easily paid any monthly interest on unsubsidized loans, plus covered daily expenses like meals and transportation.

2. Scholarships and grants are out there. For many, it just takes some research and a willingness to sit down and fill out an application or write an essay to apply. Northeastern University offers quite a few.

3. Taking on $200,000 in PRIVATE student loans is monumentally idiotic. Even if she didn't qualify for need based funds, she could have filled out a FAFSA and applied for unsubsidized federal loans. If Federal loans alone didn't cover the cost of tuition and fees, they would have at least significantly offset what she might have to borrow privately.

4. If she had taken out even one single Federal Direct loan, she would have had the option to consolidate, reducing her interest to Federal rates (notoriously low) and dramatically lowering her monthly payment.

5. She should have looked at the price tag before she decided to attend. $50,000/year in tuition/room and board/fees is far too much to pay for anything less than Ivy League. She probably could have done just as well with a degree from UMASS - if she had chosen wisely, she'd have cut her debt in half if she'd taken classes year round for 4 years, or ended up with 1/4 of her current debt if she didn't take summer classes.

It's a pretty expensive lesson to have to learn that way. But damn....really??? Really?

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Specializes in Emergency; med-surg; mat-child.

I draw the line at taking loans out, period. I'm still paying for my BA, I don't need more loans for a 2-year program. We're cash flowing it or I don't go. I'll probably be sitting for the LPN and picking up shifts while I finish up the second year. No. more. loans.

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My sister has taken out approx $20k and 7 years into college has not received a degree yet. This is after exhausting massive grants. I can't imagine having that much debt at my age! I'm still in my first semester of my ADN program and I have no debt at all thanks to low community college fees.

I wonder if that woman in the article worked at all during school. Sadly her monthly paychecks will most likely be cut in half by her payments.

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Specializes in Emergency Dept. Trauma. Pediatrics.

If I am taking out a 200,000.00 debt, it better be towards a home. No way would I take that much out for anything other than that. (Personal debt that is)

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My debt for my ADN will be less than $20k. I cringe to even take on that debt. However, my husband is working and paying for private education for our children plus my schooling. There comes a point when loans are necessary for our situation. However, a desire to minimize the loans is a significant reason I chose an ADN program at a public school. Finish up, get a job, start paying off loans and let my employer help with finishing up my BSN.

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The answer is simple - too much is when the monthly payment you can expect exceeds 20% of your projected post-graduate income.

There are a few problems with that "picture".

I agree 100%

From the linked article:

Neither of my parents, nor I, really knew how this would pan out-unfortunately-and now that I'm here, I see no real light at the end of the tunnel.

I don't see how she (or her parents) could not have known unless none of them bothered to read the loan documents. Both the student loan docs I signed >20 years ago and the ones my daughter signed as recently as this fall spelled it out pretty clearly.

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Specializes in Hospice / Ambulatory Clinic.

I think the article mentions that she was a first generation college student so I'm assuming that she had no real advice. To a lot of families who have traditionally never gone to college they think a college degree is a winning lottery ticket. College = the good life.

Also if you don't come from money you have no concept of how much $200k is though I'm sure it was rake up in $30k a years bumps.

People I went to LVN school thought THAT was their ticket to making bank gobbling up everything the recruiters told them without taking it all with a grain of salt. I earn 1/2 of what they told me I would/could earn and I knew that going in. I had reasons other than money for going LVN first.

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Specializes in LTC, Med-surg.

I think a reasonable student loan debt is

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