Yesterday, the USA Today had an article on the front page about overwhelming student loan debt.  The meat of this article dealt with the rising percentage of young people whom leave college with 75k to 125k in student loan debt!  This troubled me when I thought about twentysomethings starting their working career that far in the hole with virtually unsecured debt, because let’s face it, the government is not going to come and repossess your college degree if you do not pay back your loans.  They will simply make your life a living hell until you pay them back. 

Allow me to get on my soap box for a moment.  I slightly understand if you walk away with 100 thousand dollars in student loan debt if you went to four years of undergraduate school and four years of medical school.  However, I do not understand young people whom walk away with the same amount of debt and leave school with a master’s in a liberal arts major.  There is nothing wrong with liberal arts majors, but I must be real when thinking about what degrees offer more income potential.  The point is that we as young people must get the idea out of our head that it takes eight years of schooling to be successful in life. We must strike down our pride and bias towards the so-called “elite” colleges.  We must realize that employers do not care so much about WHERE you received your degree (there are exceptions when it comes to professionals such as doctors, lawyers, and accountants). 

The USA Today article tries to figure out why this number of students with an overwhelming debt load has increased.  They partly blame it on less financial aid funding, rising costs to live, and rising tuition costs.  It is true that these factors do play a role in the rising number of students borrowing more money for school.  However, I don’t buy it.  I think it is ultimately the responsibility of the borrower to know how much money is TOO much money to be borrowing.  There is obviously a problem, and we need to know how to fix it.  I don’t want my generation being destroyed by student loan debt early in their working careers.  I do not want my generation to get divorces, become depressed, and become less productive at work all because they are thinking about the $1,000 payment they are going to make each month.  Here are a few suggestions as to what I think can solve this problem:

1. Stop going to schools that you cannot afford.  It is time to stop pushing our noses up at state schools and community college.  A good college education relies more on what effort YOU put into it, not how many books the professor has written or the size of their library.  If your parents have saved up enough money for you to attend a prestigous private school, then by all means go there!  Community college and state schools are for those of us who have to pay our own way through school.  Do not kid yourself if you are this person unless you are determined enough to find enough scholarships to pay your way into a private school.
2. Apply for scholarships, and then apply for more scholarships.  There are billions of dollars of free money sitting out there waiting to be given away.  It is not a scam.  Student scholarships are one of the only legitimate ways to receive FREE money.  All it takes is decent grades and knowing how to write a good essay.  Oh, you might also have to be left handed, Native American, or a decendent of George Washington.
3. Work while in school!  I know that tuition is expensive, but usually the reason that some people have twice as much student loans as other people is because some students only borrowed enough to cover tuition, while other students borrowed the full amount offered which covers all living expenses as well.  You can deliver pizzas, wait tables, work for UPS, or work in a warehouse for great money and still have enough money to party on friday night and study in the library (or at least tell your parents that is what you are doing). 

My disclaimer to medical, law, accounting, dental, and other related professional students is that it is hard for you to NOT have a huge student loan bill.  However, your income potential is much higher than the average undergrad and grad student.  What this means is that you must be disciplined enough to continue living like a college student for a couple years while making a fat salary and delay buying the BMW and big house.  Does it really make sense to be making $100,000 a year while paying a payment on an $80,000 student loan debt?  That is like borrowing against your own income. 

Do not take this post as me thinking that I know it all.  I walked away with $20,000 of student loan debt and all I ended up with was a business degree.  However, $20,000 is much easier to work with and pay off quickly than $80,000 which is like owning a house, except all you have to cover your head is a piece of paper.  Also, do not think that I am down playing the importance of education.  I am all for it, but my generation is brainwashed to think that any degree spells instant financial success, and that is just not the case.