Wednesday, March 16, 2016

Debt, College, and More...

"The Lord bless these vittles we've got, and help us to be beholden to nobody," is Mother York's prayer in the 1941 Gary Cooper film Sergeant York.  With our national debt well over $19 trillion and student loan debt in the U.S. over $1.2 trillion owed by over 40 million students, the ideal of being "beholden to nobody" may seem strange.
Marianne from the financial website Personal Capital recently asked me, "Would you be interested in sharing your opinion on the student loan bubble (tuition prices are outrageous!) currently plaguing millennials and the economy?" 

Since I am, of course, the least opinionated blogger you'll ever run into (ha!), I couldn't resist the question.

I come from a family that takes Romans 13:8, "Owe no man anything, but to love one another" or "Let no debt remain outstanding, except the continuing debt to love one another" (depending on which translation you use) pretty seriously.   
We generally pay our bills the day we receive them.  If I borrow $5 from my sister, I make sure I pay her back before I sleep that night.  Most of my email inboxes usually say "Wow, you've got a very clean inbox," because I hate owing people emails (though as a few of you can attest, I'm not perfect on that)!  I'm still trying to figure out if the part of my brain that craves a clean inbox is suffering from OCD or actually devoutly scripturally adherent...

My parents taught me if I wanted, say, a big swimming pool, to work for it, save money, and buy it--that way I'd know how much work went into earning the money and could decide whether the swimming pool was worth the effort.  If I borrowed the money, bought the pool right away, and then had to work to pay off the loan, I might regret my decision.
Great-grandpa MacArthur took out a loan to buy a property in Waterloo, IA and build himself a house.  His goal was to retire debt-free, so he sold off a couple lots for a pittance just so he could do that.  Within a couple years land prices in the area had multiplied due to development.  The speculators who bought the land from him made a fortune.  Grandpa MacArthur never was a rich man, but he did die in peace--not "beholding" to anyone.

Good Debt v. Bad Debt
In his book Unfair Advantage, Robert Kiyosaki talks about good debt and bad debt.  Bad debt is money borrowed for, say, a sports car or big-screen tv.  Good debt is used to obtain increased cash flow--say, to purchase an apartment complex that you rent to tenants.  

Most people with student debt assumed they were taking on a good debt, investing in themselves, so they could succeed and make a lot of money.  And some were very happily quite right.  A disturbing number, however, have found the post-college job market unfriendly and the burden of student loans quite heavy.  

College ≠ Magic
Popular opinion is: You + College = Success.  Unfortunately there is no such magical function. 

 College can be an effective tool in working toward success, but it is not an end in itself--or even a prerequisite.  There are alternatives.  Yes, I got quite a few blank stares when I told people I wasn't planning on college after I graduated high school.  Caring friends and relatives warned me not to waste my life. 

 Debt wasn't an issue; I just chose not to.  I don't exclude going to college in the future...if I need it to reach a goal.

My father didn't go to college.  In fact, he dropped out of high school.  Now he owns his own business and is a welder, pipefitter, etc. who makes $50 an hour.  My aunt didn't go to college.  She just retired from a great career at John Deere.  Abraham Lincoln and Harry Truman didn't go to college; they were Presidents of the United States.

I know fellow young people who decided not to go to college, some of whom own businesses, others have good jobs, own their own homes, and/or have already started families.

The notion that college is the key for everyone is wrong.  There is no one-size-fits-all path to life.  
"You must go to college," has turned into a veritable siren's song.  Defenestrate this conception of college as a prerequisite to a happy life, and consider trade school and old fashioned labor as equally honorable options.  Weigh the cost and benefits of each, without presuming the economy will get any better.

If college were no longer considered a sacrosanct institution, a subsidized rite of passage for all mankind, colleges would be forced to lower tuition rates to prove to students they are still the best choice. We might see security measures taken to cut the current statistic of one in four women being sexually assaulted on campus.  We might see colleges unbundling tuition bills.   If our nation were not so obsessed with college, college might become a better place.

I dream, but wouldn't it be sweet to see the free market at work?
Learning Should be Lifelong
You're never too old to learn.  

Simply going to college isn't tantamount to learning.  One contractor my father knows told him that he went to college as a football player.  He bought books the first semester, but then realized books really weren't necessary, and pretty much just partied and played football the rest of the time he was in school.

Others I know do go to college to learn.  They slave away over their books, and work hard to pass their exams.  I admire them for that.

Proverbs 1:5 says, "A wise man will hear, and will increase learning; and a man of understanding shall attain unto wise counsels."  Proverbs 11:9 says, "Through knowledge shall the just be delivered."

Whether you decide college is right for you or not, it's important to keep your brain working and stimulated.  I set aside at least a half hour a day to try to learn something new.  

A good place to start is to study finances, money management, and the economy.  Learning to manage your personal finances wisely can save you a lot of worry, wrinkles, and gray hair.  Studying economics, on the other hand,--and the state of our national economy--will make up for all the worry you save on your own finances, and give you the beautiful silver hairs you need to show the world your wisdom.
President Andrew Jackson was strongly against debt, and during his presidency, the entire national debt was payed off.
 "Debt is the slavery of the free."  --Publilius Syrus

42 comments:

  1. Wow. Great post, Bethany! I love all the topics you touched on here. The world would definitely be a better place if people took these points into consideration.

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    1. Thank you Cryslyn! Hope all is well with you! I am stalking your blog in hopes of an update on your new precious one!

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  2. I think studying is very important in our life but much more important is oour every day knowledge and experiences in our life. In Europe intramural studies are free but for extramural studies you have to pay.

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    1. I think Democratic candidate Bernie Sanders would like to see a similar system here in the United States.

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  3. Such wise words Sweetie. You will be one successful Chick with these kind of money management rules for yourself and such a good head on your shoulders. Interesting things to think about - especially with my teenager in high school - as I wonder which path he will take in the future.

    Thanks for sharing and blessings to you. xoxo

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    1. I hope your son finds the path that works best for him! Thanks for stopping by, Carrie!

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  4. We try to live by the Word with our finances, too. And I couldn't tell you how many so called "engineers" my husband has had to train to do their jobs, and he's not even an engineer. What do they do in those "higher education" places anyways?

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    1. My papa has had similar experiences with having to tell engineers how to do things on the job. I guess there are some things that are only learned by experience.

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  5. I never get into the credit cards like most people do. I have a few but I've paid zero cents in interest since my first back in like 2010 or 2011 I can't remember. I used them for the rewards points and one that gives me a discount at Target

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    1. Good for you! Sounds like you only use them to your own advantage; a lot of people let credit cards take advantage of them!

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  6. You are a very smart young lady that will do well, with, or without a degree. I voluntarily taught about 60 people in our Church " What the Bible Says about Finances" 2500 references in the Bible by the way, and you hit on most of the Principles in your Blog. Good debt can be, but not necessarily be, if you invest in yourself to further your education. Good luck in your decisions! By the way, if I wasn't retired, I would hire you!

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    1. That sounds like a great class to teach, and I'm sure it helped many of those who attended! Wow, 2500 Bible references?! That's amazing. Thanks.

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  7. While my parents had some college level courses and my mom was an RN, they were very keen on their three daughters earning college degrees, which we all did, but I did not present college as the only pathway to my children. One of the four of them has a four year degree, is an RN, and is working on her Master's degree. As an RN she still is working on repaying her student loans and is now in her early 30s. It is an individual choice. She worked while attending college or her debt would have been worse, but I think aiming to be debt free even while attending college is a worthy goal. Thanks for a thought provoking post, Bethany! xx

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    1. Nursing jobs never go out of style; there is always plenty of work in that field! All the best to your daughter in her work on her Master's degree! Thanks for sharing about your family's experience with education.

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  8. I think your parents taught you well! You are very wise.

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    1. I am blessed to have good parents! And...I'm blessed to know James 1:5:
      "If any of you lack wisdom, let him ask of God, that giveth to all men liberally, and upbraideth not; and it shall be given him." Although my own intellect is limited by my humanity, I know a God whose wisdom is infinite.

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  9. I also come from a family that took the "be in debt to no man" very seriously. My parents told me a few things when we were growing up--you have to go to college, we won't pay for it, and you're not allowed to take out loans. I'm the only one done with college, and I have three siblings in college, with another starting in the fall, and so far we've obeyed all three of those college guidelines they gave us. I completely agree that college isn't for everyone, though I was very grateful for the chance at higher education and it's needed for my lifestyle (it's very unlikely for an American to get a work visa in Southeast Asia without a Bachelor's degree--pretty much no exceptions to that rule, but bachelor's degrees give Angel and I the ability to work and live where our hearts and callings are!). I have many friends who say they'll still be paying off their student loans when their own kids are going to college, and that's a very serious burden. Angel did make the choice to take student loans, otherwise going to college would not have been possible for him--but since he went into nursing and got his license and a job immediately after graduation, he paid off all of his loans before we even got married--he says he was one of the "lucky" ones--if he hadn't chosen such a practical career, and one that's it's easy to get overtime hours in, paying off that debt would have been a much harder task!

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    1. You and Angel live a very neat lifestyle! Awesome that you were able to go to college without taking out any loans, and great that Angel was able to pay his back quickly. Thanks for sharing about your experience with college and no debt!

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  10. Bethany, you have just proved that you definitely don't need to go to college to be wise and succeed in life! Very well argued!

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  11. This is a post packed with much wisdom- well written, Bethany! My parents have also upheld the "debt free life" mentality. As both my sister and I are very rapidly approaching college years, we bump into the reality of tuition fees more often than we should wish to. However, through the Lord's grace, scholarships and on-site jobs do have the potential to make a degree affordable" (loosely using that term XD) Thank for sharing- have a blessed week!

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    1. Awesome that your parents have taught you some of the same principles I learned from my parents. Glad everything appears to be working out for you; hope it all goes well!

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  12. Thank you for this!!! The concepts you've so clearly presented are vitally important and yet not many people care to heed them! So sad.

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    1. Considering debt in general (not student debt specifically), many people seem to want instant gratification without considering long-term consequences.

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  13. Beautifully and intelligently written. One size does not fit all for anyone. And living a debt-free life is very wise. I have done that my whole life and I sleep peacefully at night. We do have our mortgage to pay but that's a typical expense for many, and because it's equity it's also an investment! You will go far, young lady, because you've got a good head on your shoulders.

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    1. Your remark about being able to sleep peacefully reminds me of the short story "The Boy who Could Sleep on a Stormy Night". :) Thanks Martha.

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  14. Bethany! I so enjoyed this post! Thank you and keep on writing. <3 ~Lisa

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  15. Your post is really great and I agree with your assertion. I find beautiful the Bible quotations and they are rich in content for the soul. Also the sentences of thinkers such as Wadsworth, Wilson, Smith and Jackson are wise.
    I think that one of the most important things a human being can have is to have a job that he likes and help him to grow as a person. Someone who helps to wellness of society with his job.
    I know that to study in a University in America is extremely expensive. On the other hand in many countries in Europe like Germany or Spain it is almost free of cost. The fees are 400 dollars a Semester. Others are completely free of fee.
    With us you can study for free at public universities, but private ones are very expensive. But the latter have more expectation in promotion of students.
    Nowadays the “debt culture” has spread dramatically in many parts of the world. Many people use credit cards for buying what they need. However, it is better to pay cash if you are able to.
    It is truth that there are many successful people in life and business, who are not scholars. I think that someone can be successful by learning a craft or technical craft as well.
    I agree that someone is never too old to learn. In your case, you are still very young and have a lot of time. Congrats for the post!

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    1. There are a lot of good things about American culture that I wish could be spread throughout the world instead of our "debt culture." Living off of tomorrow is often not a good idea.
      Thanks for your very thoughtful comment and for sharing about the cost of education abroad!

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  16. Great post Bethany! Going by scripture, personal debt is a bigger deal than it appears to be made out. Also, I like all that you said about college...or rather, not going to college. ;) If you have a specific purpose and are truly going to learn, great. It simplyisn't a requirement for all humans though!

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    1. True. :) Thanks for stopping by, Paige!

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    1. It's a fun one; wouldn't it be nice if it came true! Though on second thought, people unhappy with their relationships might end up trying to get into more debt just so they could love each other more deeply...so maybe it wouldn't be a good idea after all!

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  18. Wise words. I wish I had heeded them when I was younger. Struggling now, but not hopeless. Thank you.

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    1. Hope everything works out for you Darryl.

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  19. I am heavily saddled by debt from college...but I knew that going into it. Unfortunately it is almost impossible in America to get a degree without having a large amount of debt afterwards. However, I do not regret it because it led me to working in my beloved field of education. Wonderfully written, Bethany.

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    1. Glad you went into it with your eyes open, and that you were able to achieve your goal of working in what you love best. Our lives are short; there's no point in spending them doing things we really don't enjoy.

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  20. É Páscoa! Cristo está vivo, o túmulo está vazio, Ele ressuscitou!!! A mais bela festa dos Cristãos.
    Crentes no Amor de Deus Pai que nos deu seu Filho Jesus Cristo que permanece conosco pela força do
    Espírito Santos, seguimos nossa caminhada na construção de um mundo mais justo, fraterno, humano,
    harmonioso e de doação.
    Todos somos promotores da Paz!
    Feliz, Santa e Abençoada Páscoa.
    Um doce abraço, Marie.

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    1. Thanks for stopping by Marie! Christ's resurrection brings us joy, hope, and peace. May the Lord bless and keep you! :)

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  21. I put off reading this post until I actually had time to sit down an think and think about it so this comment was rather long in coming.
    Wonderful thoughts Bethany! You're great at articulating what to me are topics I believe but am not very good at backing up.
    My family has been strong believers in a debt-free life for as long as I've been around. And my sister is testament to the fact that you can get a college degree without going into debt. She's about to start working on her Master's (in nursing) and is not in the red a bit.
    I also get very frustrated with the assumption that every high school Senior should be planning on attending college. When I was seventeen someone bluntly told me that I was wasting my entire life because I had no plans to use the free-ride scholarship I had been offered. I laughed and told the lady that I could get where I wanted to be in life a lot faster without college!
    From what I have seen, it's not the degree that matters as much as a good head on your shoulders and hands willing to work!

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    1. Awesome that your sister is already working on her Master's degree and not at all in debt!

      That's terrible someone would assume you wanted to waste your entire life just because you chose not to go to college. I've heard similar remarks. All the best to you in your endeavors!

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