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Weekly Update #26- Oops!

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Hey everyone, and Happy Tuesday!

To jump right into this post- last week I made an error. Not necessarily a bad error, but I feel like now, more than ever, I’m skating on thin ice. Every Wednesday (my pay day), I have my checking account withdrawn to pay off my student loans. I put make the payment request sometime before the payday (normally a week in advance) so that on payday, the money is gone and I don’t have it sitting in my bank account. Lucky for me- this month happens to be a 5 paycheck month and last Wednesday’s was the paycheck where I had nothing due, so I could put nearly the whole thing on my loans. I must have realized this earlier in the month because I somehow ended up making 2 payment requests of $705.00 to be withdrawn on the same day. I didn’t realize I did this until my account balances looked awfully low. I looked at my bank account, and sure enough, 2 payments were made. I say this isn’t necessarily a bad error because it isn’t like I went out an bought something unnecessary, but I had to move money from my EF to my checking to make up the difference. I’m down to $1000.00 in my EF, which has never been lower, hence why I feel I have a very shaky feeling about it. My plan right now is to finish paying off Sallie Mae 04 in 3 weeks and then build my EF back up before hitting the last two loans. If you look at the balances below, the $1,200 shouldn’t take too long to pay down.

On a separate note and a follow up from last week’s post, our anniversary weekend was amazing. Thanks to all those that shared your stories with me. Our trip to the ski resort was fantastic and it was a nice little day trip where we walked around their downtown (not the golf course, like I originally wanted) and got some appetizers at a local bar. When we got back home, GF made an amazing dinner and we exchanged little gifts. My gift for GF was, again, of the homemade variety. A couple of weeks ago, I was doing some research on homemade anniversary gifts and stumbled upon a Pinterest account that described homemade bath bombs/fizzies. Here’s the finished product below:

Bath Fizzies

It piqued my interest and I found a simple recipe on Martha Stewart Living (the recipes are easily google-able- I clicked on the first link). Since I don’t have any hobby/crafting supplies at home, I had to buy everything I needed to put together what I was envisioning in my head, including the acrylic paint and paintbrush for the front little “card” I made, the ribbon, tissue paper and dye for the fizzies. As for the fizzies, of the 4 ingredients needed (corn starch, baking soda, citric acid and essential oil for scent- I chose peppermint) I didn’t have any of them at home, and the citric acid ended up being a specialty item I had to buy on Amazon. The total came to around $60 for eveything. It would have cost a whole lot less if I did crafting and/or baking on a more frequent basis and had the items already on hand. To put the whole thing together took about 4 hours, 3 hours was for the prep and set time of the fizzies. Needless to say though, GF LOVED them. I don’t think I’ve ever been so proud of a gift I’ve given someone. It was truly a wonderful weekend.

As for my balances, here they are:

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid OffPaid Since Last Week
Sallie Mae 015.25$27,837.24$23,662.64$4,174.60$0.00
Sallie Mae 024.75$22,197.02$18,556.32$3,640.70$0.00
Sallie Mae 037.75$20,692.10$0.00
$20,692.10$0.00
Sallie Mae 045.75$10,350.18$1,221.75$9,128.43$1,409.92
Sallie Mae 055.25$6,096.03$0.00$6,096.03$0.00
Sallie Mae 06 and 074.75$6,415.09$0.00$6,415.09$0.00
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00$0.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00$0.00
AES6.8$9,000.00$0.00$9,000.00$0.00
TOTALS$110,587.66$43,440.71$67,146.95$1,409.92

I hope everyone has a great week!


3 Financial Issues

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Hi friends!

First, I just want to apologize for the fewer blog posts as of late. I’ve typically been really good about posting a minimum of 2 per Monday (sometimes 3) plus one more on Thursday or Friday. But the past couple weeks it’s been tough to find the time for even one post! It’s not that I don’t have anything to talk about. Trust me – I could talk PLENTY about our finances/budget/etc. It’s just that there’s never enough time! Now that the semester is really going strong it’s like a balancing act to keep everything together. I love my jobs (both of them) and am so thankful for them, but they require a lot of time and between work and dealing with my father’s health issues….well, saying I feel a bit overwhelmed is an understatement. Regarding the latter, we’re hoping to have his move to Texas (closer to family) complete-ish in the next couple weeks. I say “ish” because there will still be lots left at his house in Utah that my siblings and I will have to deal with in the coming months. But as much as we want to get the house on the market ASAP, we’re thankful to be in a financial position where we have the flexibility to let it sit a couple months until we have the proper time to deal with it all. Regarding this – anyone have experience with selling a (still furnished, in need of some repair) home out-of-state? I’m hoping we can hire an estate planner person to go sell the remaining stuff and subcontract out any needed repair work. We’ll also have to hire a lawn company and perhaps a cleaning service to keep it looking nice while it’s vacant and on the market. Any tips or suggestions in this regard?

That aside, I really had planned for the purpose of this post to be about 3 financial issues I’ve dealt with this month.

  1. Comcast:  In my last budget post I mentioned that I’d been dealing with some cable/internet provider issues. Our bill has typically been around $110-ish, but then I received a bill in August for $150!! I’d called and thought everything was resolved…until I got a new September bill also for $150! No way, Comcast! Not today! You’ve messed with the wrong person! Generally when these issues pop up it’s 100% worth it to go into the store (the local branches have infinitely better customer service than the call center people). But I logistically couldn’t make it happen between work and childcare schedules. So I called and basically geared up for a fight (though, to be clear, I always try to remain respectful when in these types of situations. It’s easier to catch flies with honey than vinegar!) I did have to ask for a manager, but I explained the situation – basically, last month they said they’d given me a credit and all was resolved, but in fact the current month bill shows that my payment was considered a partial payment. Meaning, there was no credit ever given to my account. So it showed I still owed the remaining balance. I’ve found that it helps when you tell the manager exactly what will make you happy. I mean, be reasonable. But it’s not okay to scream and yell and pitch a fit. No one wins in that scenario. Instead, have some idea of a compromise or solution that will fix the problem and be mutually beneficial for both parties. I already had in mind my solution:  just give me a credit that will take my bill down to $110 (the normal monthly payment). I’m already in a new promo rate so I don’t want to change that, but I refuse to pay the full $150 bill when I’d been told my account had been credited, all was resolved, yada yada yada. So make my bill $110, and we’ll be good. The manager had me hold for a minute and did one better. Gave me a credit so my current month’s bill is $97.02. Even better than what I’d asked for. Next month should be back to the regular rate (about $110ish). This time, I got the manager’s name and took notes of the call so I have them for reference just-in-case. But I’m hopeful that this situation is now fully resolved.
  2. Phone service: A couple months ago we switched phone providers to get a (slightly) better rate and get a free upgrade to newer phones. After canceling we received a GIANT ($250) phone bill from our old provider. But part of the deal with our switch is that our new provider would reimburse us the cancellation fee to buy us out of the contract. Rather than send us a check, they just take it off our our bill. So last month we had a huge bill to pay (to our old provider), but I was hoping it would even out this month when we got our new provider’s bill, showing the $250 credit. Turns out all is good in that area. This month we’ll have a much lower bill (but to remind you so it’s not a surprise with my next budget post – I’d fudged my August budget a bit. I paid the full $250 for the old phone network last month, but I cheated a little and split it half-way in this month. So I’ll still be reporting charges this month in my budget update at the end of the month. But really that was money that was paid for awhile ago). In October, things in this regard will be all smoothed over and we’ll be comfortably paying our new bill.
  3. Navient. Y’all. I can’t even. I cannot. Remember my “best day ever” post where I said my Navient issue was resolved? Ha! Nope! It seriously makes me so angry just thinking about it so I’m going to keep this brief for the sake of my blood pressure and psychological wellbeing. Long story short – issue is NOT resolved. They still have my loan (which was just transferred from another loan servicer, ACS) categorized as unsubsidized. They claim its a valid unsubsidized loan. Many, many hours (literal hours) of my life have been spent talking to all kinds of people – Navient’s customer service, Navient’s escalation department, the loan guarantor, national student loan database services, and on and on and on. We’ve reached a point where I’ve had to contact a loan mediation service (it’s free for me – part of the federal government, I guess). But they don’t move quickly. My last call to them was Friday and they said I wouldn’t hear back for 7-10 business days. So, yeah. In the meantime, I’m being charged interest out the wazoo for this student loan that is supposed to be subsidized (and, therefore, unpaid interest is supposed to be forgiven). So its going to totally mess up my debt totals when I do my next debt update (hopefully coming this Thursday! I’ve been holding off hoping that I’d get this issue resolved so I could report accurate debt totals, but no dice). I swear this issue has taken years off my life due to the stress and headache of it all. I know on my last post many people suggested reaching out to a class action lawsuit attorney (since Navient has so many pending lawsuits against them for wrongfully charging extra interest, etc.). I’m hoping the mediation can help us come to a resolution. I’m just so strapped for time I don’t even know what to do. It’s a huge burden in my life and just makes me wish I could write a check and be debt-free today. It’s just so wrong and it feels like there’s no ramification. No way to hold them accountable. I feel a little bit defeated at this point. But I’m keeping the course with the mediation route and hoping for some success at the other end. I’ll keep you updated.

So that’s the update on my 3 financial issues. As per usual, this was way lengthier than I’d originally intended. heh. Guess I had a little time after all. I’ll try to get a debt update post put together for you guys for later this week (Thursday or Friday). Thanks for your support along the way!!!


What an (EXPENSIVE) headache!

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Argh! ((shakes fist at Navient))

I hate beating a dead horse, but here we go…..

Navient just sucks so bad. SOooooo soooo bad!

The latest way they’re trying to screw me over…

I recently mentioned that one of my ACS loans has now migrated to Navient. Only, somehow, in the migration it has switched from being categorized as a subsidized loan to an UNSUBSIDIZED loan. This is a big deal because I’m on income-based repayment and, under IBR, unpaid interest is forgiven on subsidized loans. But unsubsidized loans continue to accrue interest. Right now my minimum loan payments are really low – they don’t even cover the interest! So I’ve been strategically targeting only a couple of my loans and paying minimums on all the rest, with the knowledge that unpaid interest is forgiven and I will just live with paying interest (no reduction to principal balance) until my current target loans are paid in full and I move onto the next loan.

Well, after discovering Navient’s egregious error I gave them a call. Only, they say that their paperwork states that the loan has ALWAYS been unsubsidized. I explain that there’s no way! I carefully track my loans every month and you can clearly see that they HAVE to be subsidized because the balance has always stayed EXACTLY (to the penny) the same! That’s because I’m not even paying enough to cover interest and all unpaid interest is forgiven. Period.

They acknowledge that, yes, they can see how unpaid interest has been forgiven. But their paperwork says the loan is supposed to be unsubsidized. Their hands are tied and there’s nothing they can do. I will need to get the original master promissory note to show that the loan is subsidized. In the meantime, my loan has somehow accumulated OVER THREE HUNDRED DOLLARS in interest!? In only a few days!!!!

Well, of course, getting access to the master promissory note includes several more hoop-jumping exercises not even worth going into here. Just note that it’s been a frustrating experience and I still have not even managed to get ahold of it (though I should hopefully have it this week!)

So let this be yet another in my long string of warnings about the potential pit-falls of student loan debt. And another cautionary tale of why you should be very vigilant about careful monitoring of your student loan account(s) on a monthly basis to make sure you catch these types of errors when they happen to you (notice I said WHEN, not if!)

In the meantime, why not add another task to my mile-long To Do list. I just love it when someone else’s incompetence creates more work for ME to do (can you just hear my sarcasm?)

Hope your Mondays are off to a better start!


Weekly Debt Payoff #20- Back on Target

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Hey everyone! I hope you’re off to a great start to your week.

I want to start off with a quick July 2015 monthly review:

  • The month was my month off, in which I took not only a physical vacation to Walt Disney World, but also used the month as an emotional and spiritual vacation from any type of debt reduction. Although I enjoyed this month off, I wrote about all my overarching feeling towards it here (Thoughts).
  • I used my extra funds from the month to 1) buy new clothes 2) enjoy some date nights with GF 3) refund my emergency fund (it was in the vicinity of $1,500.00 and now sits at $2,162.63; having anything below $2,000 makes me feel uneasy). Although I didn’t tackle everything I had on my to do list, I ended up getting a lot accomplished and feel pretty good about paying off this last $48,000.
  • Last week, GF and I had planned on holding a garage sale over the week. This plan fell flat, unfortunately. Not because we didn’t want to, but we were pretty overwhelmed with the time and effort it took to get everything properly prepared, especially after all the detailed comments I received on the subject. Between moving cleaning off and getting items ready for sale and moving them into our garage, we only got through 1/2 our stuff. Looking to hold a longer 2 day event in 2 or 3 weeks.

Ok, on to my debt payoff plan for the remainder of my balance. For anyone interested, here are my current totals:

Loan NameInterest RateOriginal Balance- May '09Current BalanceTotal Paid OffPaid Since Last Week
Sallie Mae 015.25$27,837.24$23,776.95$4,060.29$61.64
Sallie Mae 024.75$22,197.02$18,651.56$3,545.46$50.79
Sallie Mae 037.75$20,692.10$0.00
$20,692.10$0.00
Sallie Mae 045.75$10,350.18$5,310.59$5,039.59$615.30
Sallie Mae 055.25$6,096.03$0.00$6,096.03$0.00
Sallie Mae 06 and 074.75$6,415.09$0.00$6,415.09$0.00
Sallie Mae- DOE 015.25$5,000.00$0.00$5,000.00$0.00
Sallie Mae- DOE 025.25$3,000.00$0.00$3,000.00$0.00
AES6.8$9,000.00$0.00$9,000.00$0.00
TOTALS$110,587.66$47,739.10$62,848.56$727.73

Note: the paid off since last week is really the paid off since my last update in June, with the majority of the payoff coming just last week.

I know I said this before, but I’m SUPER ready to knock off these debts for good. I’m going to be as frugal as I was going into my month off, however, I have a few caveats:

  • I’m going to consciously maintain a sense of balance between life and payoff. I feel I’ve done pretty well over the last couple months and I don’t want all that effort to go to waste. My $50 a month has really helped in this area.
  • I’m going to continue contributing 10% of my salary to my company 401K. I enjoy seeing this balance go up every week and it will be awesome to start my debt free life with a sizable nest egg.
  • I’ll also continue contributing $25 to my nephews ESA account for his future college tuition.
  • I changed my mortgage payment schedule from a one-time monthly lump sum payment to a weekly payment schedule with a little extra for increased principle reduction. It’s only been active for a couple of weeks, but I like the idea of not having a huge payment due at the end of the month.

Timeline- My extra extreme schedule is to make my final student loan payment in 18 months. Is this realistic? Not really, but it’s nice to dream of being debt free before I hit 30. It’s looking like it’s going to be closer to 22 months, if none of my caveats change. I should have Sallie Mae 04 paid off by the end of October at which point I’ll start on Sallie Mae 01 (the big boy). It seems like a horse a piece between paying off Sallie Mae 01 and Sallie Mae 02, so I’m going to hit the larger of the 2 first. Good idea, or should I continue going from smallest to largest?

I plan on sharing my new budget at the end of this week.

I hope everyone has a great day!


Financial Priority List

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One of my new favorite things to do since signing my first full-time employment contract is to run numbers over and over again to determine our new debt-free date. 🙂

As a side-note, I ran across an old notebook from last summer (August 2014) where I’d written projected debt-free dates and was slightly heartbroken to see I’d originally hoped to have my car loan paid in full by January 2015. Crusher! Still about 15 grand to go on that one (latest debt update here). But I’ll be hitting it hard once the paychecks start rolling in.

Regarding pay, however, things are still a bit up in the air.

A reader who works in HR commented a couple weeks ago to say that I probably need to receive official permission from my new job to continue working at my online teaching job. I really hadn’t thought anything of it because I know lots of professors who adjunct teach at a community college on the side of their full-time professor gig. But as this is my first full time position and I absolutely do not want ANYTHING to jeopardize it in any way, I called HR to be safe. At first I got a casual response, “I don’t see why that would be an issue but I’ve never had the question before. I’ll check with someone else and call you back.”

So I go the rest of the day thinking I’m A-Okay until I get the call. Even though my part-time job can be completed at nights and on weekends, will not interfere in any way with my new position, and is only adjunct teaching (no additional responsibilities, etc.), the employee handbook has a little section stating that any employment for any other university or college MUST be approved by the department head AND college dean. Ouch.

I’m still hopeful about the situation. I really don’t think it will be a big deal given the parameters of my online teaching job (specifically that it can be completed any time so it won’t cause any impairment to my new day job, and it’s a simple adjunct position). BUT the bottom line is I have to ask for official permission to continue working for the online job and, if I’m told no, there goes my hopes of making serious progress on debt repayment.

Let’s step back a sec and talk numbers without actually talking numbers. Just follow me.

My new full-time job pays about 50% more than my current part-time online teaching job.

BUT

After running the numbers of all the deductions to be taken out from each paycheck, which are substantial (including: health, dental, vision, retirement, money for a flexible spending account for childcare expenses, taxes, etc. etc. etc.) I’m only going to actually be netting an extra couple hundred bucks a month. Soooo, practically the same monthly pay for my full-time job as what I make at my part-time job.

Of course, my money will stretch a lot further at my new full-time job because, unlike the part-time job, I won’t have to deduct funds monthly to pay my own taxes and health insurance. I’ll be paying for (part of) childcare with pre-tax dollars to save some money there. I’ll be paying for health care with pre-tax dollars to save some money there. I’ll be saving money toward retirement where previously I’ve saved nearly nothing. And so on.

But when you just look at the bottom line…. being able to keep my part-time job effectively doubles my take-home salary. So obviously I’m hoping I’ll be able to do that.

Cross your fingers for me. I meet with the department head the week of the 20th (exact date TBD) so I’m hoping to bring it up in our meeting and have it be no big deal.

In the meantime I have a just-for-fun list of financial priorities along with some projected dates.

Financial Priority List

  • September 2015 – Add $4,000 to Emergency Fund. With hubs’ no-income month of May and the fact that much of my paycheck was sucked up into an overdue tax bill, we basically lived on our EF for the month of June. We do have a little left (just under a thousand), but I’d like to beef it up to the $5,000 mark. If we put some aside in August and some in September, we’ll hit that goal. It’s tough to put so much toward savings instead of debt but I feel really strongly that we need to have a solid EF, if for nothing more than my own psychological well-being.
  • December 2015 – Pay off remaining car loan (approx. $15,000). This is still a bit of an aggressive goal, but as long as I’m able to keep both my jobs I think there’s a really good chance we can still pay off our car before the calendar year is over. I CAN NOT WAIT until this loan is paid because it will signify reaching the consumer debt-free mark – a huge milestone in my mind.

And here’s where things get controversial….

After the car is paid off, I definitely want to start paying more toward my student loans. But instead of diving full-force into paying off these loans with the gazelle intensity that I’ve tried to have for all of our other consumer-related debts, I want to split my priorities a bit. I still feel very strongly about paying off these loans as quickly as possible (especially the unsubsidized loans; and I plan to continue doing balance transfers to save some interest where possible, too). That being said, however, there’s something else I feel really strongly about too.

Home ownership.

No, we aren’t looking at places today. No, we don’t even know what the next year may bring (examples: (1) my dad’s scary health issues, and (2) I’ve still been in talks with the out-of-state university where I did my not-an-interview earlier this year). But all that being said, once the consumer debts are paid in full I think it will be important to start saving more aggressively for an eventual down payment. At this point I don’t know specifics (no idea the amount per month we’ll save versus the amount put toward student loans every month), and I really do want to stress that I want my student loans gone ASAP! I hate dealing with them every month. I hate the amount of interest they cost me. I hate their drama. I hate that they’re this huge, scary, black hole of debt on my credit report. So in no way am I suggesting that I’ll only pay minimums or drastically reduce debt payments. No way!

Look. It’s never been a secret that I really want to put down roots somewhere. I said it in my very first “Meet Ashley” post that I wrote when I interviewed to be one of the bloggers here. It’s important to me. The American dream and all that jazz. And the older my kids get, the more I want it.

I’m sure I’ll be talking more about this as time moves on. But for now, we’ll just say that I’ve got these two concrete goals (restock EF by September, and consumer debt-free by December), and then we’ll have to do some reassessing at that point. Either way, 2015 is shaping up to be a pretty kick-butt year in terms of debt repayment. Full throttle ahead!

 


Why I Have So Much Student Loan Debt (And Why YOU Should Avoid It Like The Plague!!!)

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A few weeks ago I posted the latest in my student loan drama.

A reader asked if I’d write a post explaining why I ever borrowed so much money for school in the first place. What was my thought process like when I took out the loans? What were my plans for a repayment timeline? And, just generally…what was I thinking?

I will speak only for myself, as every person is in a different situation.

First, if you’re a new(ish) reader, I recommend checking out my debt story to explain how I acquired so much debt in the first place (I haven’t always had debt! It all came while I was in grad school). And if you are curious, I’ve broken down all my Navient student loans in this post (keep in mind, that does not include loans from ACS). My latest debt update (with all debts) can be found here.

Why did you take out student loans in the first place?

I was so lucky to have parents who were financially able to help me through my undergraduate degree. For my first year (living on campus), they paid for everything – tuition, books, room, board, meal plan, etc. I worked part-time for fun money. Over time I took on more responsibility for paying my own bills. By my senior year of college they were still helping pay all my tuition and books, but I had been working a lot more to pay for my living expenses (rent, utilities, car, food, etc. etc. etc.) This worked well for me because I was able to gradually take on more responsibilities associated with “ adult life” instead of having it happen overnight when I turned 18. Not everyone is so fortunate and I am forever grateful for the gentle scaffolding I received in that regard. But one thing I always knew is that I would hit the end point of financial assistance once I graduated. My parents knew I wanted to pursue an advanced degree (I’ve always wanted to be a college professor, which requires a PhD), but we had all discussed it and I knew I’d be on my own in terms of paying for the degree. Perhaps interestingly, my stepdad (who married my Mom when I was 16, but has been in my life since 14) has a Ph.D. But things were so, so different when he’d received his advanced degree. So we never had a talk about how to avoid student loan debt, or the best way to minimize student loan debt. I don’t want to bash my parents – they did the best they could with the information they had (they really didn’t know how much it could cost to earn a Ph.D. today). But I do wish someone had pulled me aside and had a financial conversation with me about student loan debt. Instead, I simply viewed student loans as the only logical way to pay for my advanced degrees. There was never a question of doing anything differently.

But why so much student loan debt? How did it get so out of control?

Most of my student loan debt was incurred in my first two years of graduate school while I was living in Florida. I talk more about it here. Basically, tuition was insanely expensive for an out-of-state graduate student and I didn’t receive tuition reimbursement from the university. I racked up nearly $50,000 in student loans those first two years, alone. It all happened so quickly I never really wrapped my brain around it. At the time I had a good friend pursuing a medical degree (which we know is $$$$), and we talked about student loans one time. She talked about how she mentally compartmentalizes the money so she doesn’t stress about it. She actually made some metaphor of the money being “fake” – like Monopoly money or something. It made her feel better psychologically and it was easier to cope with racking up the kinds of loans she was taking out. I basically followed suit with the same strategy. The common (mis)conception I’d always been told was that “education is always valuable” and “student loans are ‘good’ debt.” Note, these are two things I vehemently disagree with now, but I bought into the myths at the time (along with all my grad school buddies).

So education isn’t always good? What do you think now?

I’m in higher education, so obviously I’m pro-college (I teach college courses so I’d be out a job if no one went to school!) BUT I know so many people who went to college just because that’s what they’d always been told to do. My belief now is that education just for the sake of education is a LUXURY. There’s nothing wrong with it. I love to learn! But unless you can afford to pay cash, it should be in the same category as a luxury vehicle. You don’t need it. Just going to school blindly with no plan for the future (in terms of career, projected earnings, etc.) is not wise in my opinion. Instead, high schools should offer prep courses or parents should sit their kids down and think about costs of college versus projected salary. They need to be in-sync. You wouldn’t take out $100,000 of student loan debt for a degree in German Polka History (Dave Ramsey’s example). You need to be sure that you’ll be employable after graduation! Are there jobs in your degree area? What is the starting salary? What is the average salary? How much is your degree going to cost? These are questions that young people should be examining before selecting a major and enrolling in classes. If you’re unsure, it’s not the worst thing in the world to wait a year before going to college! If parents are okay with helping a child financially and the kid wants to take general courses while they figure out what subject to major in, then that’s fine. I’m not going to judge anyone else. But for me and my children (when they reach college-age), we’re going to have some serious financial and career-oriented discussions prior to ever registering for that first college hour.

When you were taking out student loans, what did you think would be the timeline for repayment?

Honestly, this is a subject my grad school friends and I talked about frequently. And you know what the common thought is? “I’ll have these loans forever.” When you graduate you’re put on a 30-year plan, the same as a mortgage, and you just assume they’ll be around forever. Maybe not everyone thinks this way but this was the overwhelming majority of opinions that I have experienced (that goes for grad students at both universities I attended, so it wasn’t limited to a specific place). I really didn’t think specifics in terms of payments and interest while I was in school. I never even knew the full amount I owed until after I graduated as I was doing my exit loan counseling. I knew I owed a lot, but I’d never had it all added up before in a single place until then. I had no idea that my monthly payments (before applying for IBR) would be over a thousand dollars a month, and that over a third of the payment would be going straight to interest. It’s incredibly overwhelming and scary to find yourself newly graduated, no job yet, and to discover you are responsible for a mortgage-sized debt.

Million dollar question…. Would you do it again?

I would definitely still earn my advanced degree (Ph.D.) because its required for the type of jobs that I want (and for the job I recently accepted!). Even if I hadn’t landed my new job, I wouldn’t say the degree, itself, was a waste. But if I had fully understood the implications of my sized student loan debt, I would have done everything in my power to avoid them or minimize them to whatever extent possible. Here are some real life things I would have done differently (that may or may not apply to other peoples’ situations):

  1. Work while in school. I did this in undergrad, but graduate school felt so all-encompassing that I didn’t think it was possible. You know what? It was. Eventually I came around while pursuing my Ph.D. and I taught several classes at the local community college. But the whole time I was in Florida (where, again, most of my debt is from), I didn’t do a single thing other than school. What a wasted opportunity to try to earn some money and minimize the loans I was taking out.
  2. Work on campus. Especially in Florida where I did not receive any tuition reimbursement, working on campus would have been invaluable. They paid pretty poorly (I think minimum wage at the time – about $8/hour) BUT they gave tuition reimbursement! At $1,000 per credit hour, that tuition reimbursement would have been worth it even if I had been working for free! I should have gotten a job on campus.
  3. Work (even for free) through any company that will pay for your education. This tends to be less common if you want to go into academia (like me), but I had several friends who worked for places (or interned, where they earned no paycheck at all), in exchange for a partial or full college tuition reimbursement. Think about your career trajectory and see if this can somehow work for you. Even many retail stores offer tuition reimbursement of some kind. You just have to do a little digging and asking around to find out if it would work for you!
  4. If your desired school is out-of-state, move there first! This is a big one that not many people know about. If you move somewhere (out-of-state) for school, you will be considered an out-of-state student for tuition purposes the entire time you stay there (not just first semester or first year). I learned this the hard way when I went to a school in Florida. We lived there full-time, hubs worked there and paid taxes there, we were considered residents in terms of our licenses and for jury duty (I even served on a jury while living there!) But we were NOT considered residents for tuition purposes. The way around this is that if you know you want to attend an out-of-state college, you can actually move there a semester (or year) before you plan to attend! A big secret tip for grad students, specifically… I know more than one person who did not get into their dream university. So they moved to the school’s city and started attending lab meetings and discussion groups on their own time. They even took a few classes as non-degree seeking students. And as long as they made a good impression and forged relationships with faculty members they were always, without exception, admitted the following year. Why? It shows extreme dedication to move cross-country and start attending a school without officially being accepted there! So for any future grad students who didn’t get into the dream program – there’s still a chance! Build those connections prior to matriculation and you’ll (1) likely get in the following year, and (2) be considered in-state for tuition purposes since you moved to the state before starting school!
  5. Look at tuition when determining a school to attend. I can honestly say I never once looked at tuition rates when deciding where to apply to and where to eventually attend. That is so, so, so silly on my part! This is REAL money that is going to take REAL years to repay, not to mention interest, etc. So look for places that are inexpensive and affordable! At the undergrad level, start with a community college (bonus – you can likely work full-time and take classes at night and on weekends). Then transfer to an inexpensively priced in-state university to finish up your bachelor’s degree. This will help minimize the amount of loans that are taken out to cover the tuition.
  6. Get involved in a cause! And apply for related scholarships. Really you should apply for every scholarship or grant known to man-kind. But I’ve found that it helps increase your odds if you get involved in some specific group (often a philanthropy of some kind) and apply for scholarships specifically targeted toward the group. As an example, when I was a grad student I joined an organization specifically for women in academia. I attended bi-annual meetings, mentored an undergraduate girl, served on annual committee panels and even organized a symposium one year for middle-school and high-school aged girls. As a grad student, I found various women’s organizations that offered grants and I was able to win several due to my extensive involvement in the women’s organization at my university. They weren’t huge grants, but they covered my costs to attend various conferences, paid for travel, lodging, conference costs, etc. etc. etc.

Those are my tips. Feel free to leave any additional tips in the comments section.

And if you are a parent or mentor to a young person about to graduate high school, don’t be scared to pull him/her aside and have a frank discussion of the long-term implications of student loan debt (and all the drama that accompanies them). Knowledge is power! : )


Month in Review- June 2015

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Hey Everyone! I hope you’re all having a great week.

It’s July 2nd, so that means it’s time for a month in review. June went by in a flash, didn’t it? The summer months always seem to fly by so fast.

Since I didn’t post on Tuesday, I want to share a couple of items that happened over the weekend:

  • The same couple that I went out with earlier in June, invited me and GF out again; this time for dinner AND a movie (BTW- Jurassic World is AMAZING). I happily said “Yes!” but it also broke my “fun” budget for the month, which I carried $50. It wasn’t a big deal since my buddy asked me earlier in the week and I was able to budget for the dinner and movie out of my paycheck vs. having to dip into my emergency fund. I’m just really excited that I don’t have to say “No” to everything anymore.
  • I didn’t have a debt update to share since my last paycheck of the month is delegated to paying my mortgage and some other smaller bills. If I didn’t have any plans during this week, I could normally set aside $70-80 for a debt payment. Since I went out to dinner instead, I made no debt payment this week.

As for June, there was a lot that happened, so to review:

  • Firstly, now that most of my smaller debts are paid off (with only one more to go below $10,000) I had an internal struggle (The Hard Wins) on how to deal with the the fact that the payoffs are going to be few and far between now.
  • The day after my “Hard Wins” post, I increased my 401k contribution from 4% to 10% (which I mentioned in the comments of that same post). Update: I think this was a wise decision. For one- I haven’t noticed much of a difference in my take home pay. It ended up being about a $60 difference, but it’s definitely not hurting my ability to pay my bills. Plus, it’s awesome to see my retirement account grow so much faster!
  • In the following post (Time Off), I decided to use the month of July as a vacation from paying off debt to both enjoy my vacation to Disney and clear my head so I can hit August refreshed and ready to go. Update: vacation is only 7 days away (yay!) and this Wednesday’s paycheck marks the first paycheck in a LONG time (if ever) where I didn’t have to make a debt payment. I’m using all the extra  money to buy myself some new clothes and to stock up on supplies (more on this on Tuesday)
  • I went out for dinner and drinks with a with an awesome couple, in which my “fun” fund came in really handy (here) and was most definitely worth it.
  • In this post (Birthday Party), I went to a good friend’s son’s 1st birthday party. Since I started an ESA account, I figured I give the gift of some cash for my buddy to start one of his own for his son.
  • In the same post, we began our planning for Disney. Since we are driving down, a lot of you had some great ideas our how to make our trip as fun and as frugal as we can. We’ve incorporated many of the ideas into our plan as we want to spend as little money as we have to on our drive down and then back up.
  • Lastly, we had a little Father’s Day celebration (Father’s Day) where GF did some amazing little things for me, as I am the father to our kids (lol, they’re dogs). We also started cementing our Disney plans and GF used her couponing skills to get us a whole bunch of goodies on the cheap.

As for my debt paydown, no big milestones met this month, but I still paid off $1,592.21. Down to a balance of $48,466.83. Not my best month, but not my worst, either.

Hope everyone has a great holiday!