Okay everyone, today is the day that I disclose something about my debt that I don’t usually talk about. And the reason I don’t usually talk about it is because…well, to be honest, I only fully came to terms with it this week. It’s a tough and somewhat embarrassing topic for me, but I also think it’s a pretty important issue, so here goes.
As you may know, I have a lot of student debt—tens of thousands of dollars (perhaps someday soon I’ll muster the courage to disclose exactly how much…), all of which I accumulated over the course of my two graduate programs. Now, the term “student debt” implies that the money was put towards your education. And for many people in student debt, this is 100% true. But recently a friend of mine read part of my blog where I talk about how I got into debt, and she commented, “Oh, I didn’t realize that most of your loans were for living expenses.” And although of course I knew that that was true, it wasn’t until a couple of days later, when I found I couldn’t get her observation out of my head, that it really hit home:
I had been using my student loans like many people use credit cards.
Although I am technically in “student debt”, it would also be accurate to say that I am, in a certain sense, in consumer debt. This is humbling, as I confess that I’ve said to myself many times, “yes, I’m in debt, but it’s student debt, and that’s a little different.”
But it’s really not that different. Like many graduate students who teach or do research in exchange for tuition, I’ve never had to pay the bursar’s office much of anything. I think there are a few minor exceptions, like one or two individual summer courses that weren’t covered, but I think it’s fair to say that 90% of my loan money went towards living expenses.
Now comes the mysterious part. The thing about “living expenses” is that this term could refer to literally anything. Anything!!! If you a) are living, and b) have an expense (i.e., you purchase something), then you can pretty much refer to this as “living expenses” and nobody is really going to question you.
It wasn’t that I used my loan money to buy a pony or a yacht or a Lamborghini. I definitely didn’t. But on the other hand, I also didn’t make as concerted an effort to be frugal as I could have. The loans felt like free money, and I used them as such. Yes, some of them went towards rent and gas and groceries, but I also bought clothes and shoes and earrings and books (not just textbooks but also regular old books to feed my regular old book-buying habit). I used them for eating out, for buying gifts, for a bit of travel, and so on. Nothing crazy, and I remember thinking that I was doing a pretty good job of not going overboard, but I had no business pretending I had disposable income…because I didn’t.
It’s really hard for me to understand what I was thinking at the time—most of these decisions were made between 2007 and 2011, which is a while ago. But I’ll try to break it down. I think there were two components:
- Having never tracked my spending, I had no idea how much it cost me to live from month to month. This meant that I did not have a sense of how much I would need to take out in loans to maintain my current lifestyle, and so I just took out a pretty large amount to be safe. And once that money was in my bank account, it felt like my money, and so…I spent it. I also didn’t think actively about how much money I would need to make in a future job in order to pay off the loans (and their interest) in a timely fashion.
- I had heard a lot of people say things like, “Education debt is good debt!” and “Don’t worry, you’ll pay it off in no time once you’ve graduated” and “This is an investment in your future.” And I just accepted those statements at face value.
Again, one element of this that’s troubling to me in retrospect is that during both of my degrees, I was getting paid by my school for doing research and/or teaching. So I probably could have swung it without taking out loans, or at least I could have taken out far fewer. During my first degree the yearly stipend was only $12,000, but since the program was not a particularly rigorous one, I definitely could have taken on a part-time job to supplement my income instead of spending my free time watching House (I mean, House is great, but sheesh).
So yeah. I wish I had taken on that job. I wish I had opened up an excel spreadsheet and done the math. I wish someone else had forced me to do the math. I wish someone had explained budgeting to me. I wish I had been more conscious about my spending. I wish I had viewed my education as a financial investment in my future. I wish…
But wishing isn’t going to get anybody anywhere. I made the choices that I made, and this is where I am.
So, my goal right now is to try to have some compassion for my younger self. I really do believe that for the most part, people are usually doing the best they can, given the resources and information available to them. And I think that was true for me as well: I was doing the best I could at the time.
But if you know any students or soon-to-be students who might be thinking of taking out loans for living expenses…maybe send them a link to this post. Also to this post by Jaymee, which I wish had been around eight years ago for me to read.
What do you think about the fact that students can take out
huge amounts of loans for “living expenses”?