- But the officials acknowledge that a large pool of borrowers have essentially fallen off the radar. The Education Department has assembled a “behavioral sciences unit” to study the psychology of borrowers and why they don’t repay.
LOL
That is a pretty funny quote. It doesn't take a team to figure out that people need transportation, shelter, food, and warmth. All of those things will be put above loan payments. Well, that is honestly the issue with the current education system. They promise that everyone will be making a lot of money, but that is not how it works. Not everyone can make a ton of money with the degrees that they have picked. And if they pick something minor or obscure, it raises the level of risk that they took.Once his deferment expires, he isn’t sure if he will feel obliged to pay down his loan. “They promised me everything,” he said of his for-profit college. “And I honestly have nothing to show for it except a piece of paper that doesn’t really do me any good.”
It's more than that - the company you took out the loan with has probably sold it two or three times, you've maybe consolidated a few, that whole thing has been offloaded to someone else and you end up owing a giant nut to a company you've never heard of that can't even keep in touch with you in a reasonable fashion. Lookin' at you, Granite State. So you borrowed money for school, which isn't like borrowing money for say, a car or something you like, and you got fuckall for it, and now this company says "you can pay up or... you know, postpone things until the future gets better. We'll just add a bunch of interest." So now not only do you owe a fuckton more than you actually borrowed, you're reminded that your situation has not improved in the past year and you've heard it's gonna take years before they can do anything but fuck with your credit rating, and you're not buying a house in this market so who cares? Not shown in this article is the income-based repayment options, which are easy to game and still qualify as "payments." By the time we're done with income-based repayment we will have paid 30% of the principal on my wife's medical loans and about 10% of the interest owed. Over the course of the loan, her $180k in bills will have mushroomed to $2.2 million and you know what? NOBODY is going to feel obligated to pay that.
Anecdotal, but when I dropped out of college, I had a relatively decent time with my student loans. I was raised with the idea that I shouldn't borrow more than I think I could pay back, do what I can to pay on time, and a loan is like any other promise, if you give your word, you have to keep it. So, after dropping out I didn't have much to show for myself, other than a big, ugly debt. I buckled down, got two full time jobs, and started working 70-80 hours a week, paying off that loan as quickly as possible. After about three years, it was gone. I still kept those two jobs though, to try and keep myself out of debt, build a nest egg, etc. Unfortunately, I made some very bad decisions that left me in a financially bad state for a few years that I had to crawl out of as well (life pro-tip people, just because you can afford something this month, doesn't mean you can afford it every month for years, this applies to car loans, apartments, etc.). Anyhow, I came out relatively intact. The thing though? I didn't owe anywhere near what your wife or other people end up owing by the time they graduate, so they struck me as reasonable and managable. If I had owed that much money I would have found myself so overwhelmed it would have shut me down emotionally. I would have taken a hard look at my loan payments and a hard look at that shiny El Camino on Craigslist and make the logical choice. I'd get the El Camino. College already burned me. That car? That car is material happiness bro.
When the equity in your house pays a percentage of the principal on your student loan, you recognize that it's all a big fucking game and the sooner you learn the true rules the happier you will be.
That much is true. Unfortunately that risk isn't mirrored on the lenders end. If it were, there would probably be less student loans issued, and the cost of college education would be lower. It drives me crazy to hear politicians talking about loans as a way to make college more affordable. That's like saying that lower interest rates, or lowering the necessary deposit on a mortgage makes housing more affordable. It just takes a short time before those adjustments are reflected in higher prices.And if they pick something minor or obscure, it raises the level of risk that they took.
I remember you posting that before, but I didn't remember how truly awful that slippery slope of debt is. When do you expect the dam to break? For comparison, the system here is now that I have 35 years to pay it off, with minimum payments at the level where after 35 years it should be paid off. Interest is <1% and the minimum payments are income-dependant.
One of the arguments made a lot during the recession was that the 1% wants a capitalist system when they're making money and a socialist system when they're losing it. The more things break, the more intervention we throw at it. So the question becomes, how does it break next time? Let's suppose the economy takes a shit within the next 18 months. Gonna go out on a limb and predict Clinton as president, but the Sanders campaign still has a giant mailing list and a political machine par excellence. People forget: MoveOn.org started over the Lewinsky hearings; it was just a petition of people who wanted congress to "move on" from the fucking blue dress but since they signed their email address, a juggernaut was born. So there's President Clinton, cozy with the bankers, and there's a recession, and people are out of work, and the people hit hardest are going to be the millennials because that's the way it's been for the past ten years and a plurality of them felt the Bern. Imagine if Occupy Wall Street actually wanted something, instead of simply hanging around in drum circles. I think a few angry gatherings of out-of-work millennials burned by the smoldering carcass of Dot.Bomb II demanding student loan reform are likely to get shit passed right quick. That's a point a few people have made, but nobody really takes seriously - the Sanders campaign has built a hell of a political machine and it's not going to suddenly dismantle itself after the convention. You don't put something like that together so you can leave it parked in the garage.
I don't see Sanders being swallowed up by the Clinton campaign. He ran, he said, because he didn't want to see Clinton unopposed. He switched his allegiance from "independent" to "democrat" just so he could. He's always been an oppositional figure, a gadfly in the machine, and just because he (probably) won't win this time doesn't mean he's going to roll over and play dead. I mean, yeah. He's not going to say nice things about Clinton. Already isn't. But he's going to say less nice things about Cruz/Trump/DarkHorseduJour.
Well right now he doesn't have to say nice things about her but if he doesn't win hes going to be expected to tow the party line. Hes likely going to have to come out supporting Clinton in positions that are going to be against the interests of his base. I don't think hes going to be allowed to come out and say that yeah Clinton is shit, I agree, she is bought and paid for by big business and corrupt as hell but the other guy is a crazy loony so vote Clinton. I could be wrong but I don't think that's how politics works. Sanders basically has to either withdraw his presence from 2016 presidential election and re-purpose his movement into local elections or go independent to maintain the movement. Otherwise he will be forced to actively endorse and promote existing Clinton positions which suck and will loose him credibility. VP sanders would also kill the movement because then he would just be a puppet in the Clinton campaign. Basically I think either the movement is re-purposed to support Clinton and it dies (because Clinton excites absolutely nobody) or it needs to be split off from the democratic party and I'm not sure how that would happen. What kind of scenario do you envision that allows the movement to continue on its own?
That's just it, though, dude - https://en.wikipedia.org/wiki/Bernie_Sanders#Party_affiliation_since_2015 Sanders' party affiliation is younger than my driver's license. "Going independent" is hardly a tribulation for him. If he decided to hook up with the Green Party they'd be viable for the first time since 2000. If he decides to retain his senate seat he gets to be Pelosi's counterbalance. The only way Sanders goes away is if he decides he wants to go away and makes the active decision to fuck off with all of it. And if you don't think Barack Obama doesn't email everybody that donated to his campaign every day you clearly didn't donate.Sanders basically has to either withdraw his presence from 2016 presidential election and re-purpose his movement into local elections or go independent to maintain the movement.
In November 2015, Sanders announced that he would be a Democrat from then on, and will run in any future elections as a Democrat. On February 4, 2016, Sanders said, "Of course I am a Democrat and running for the Democratic nomination."
I'd bet you a quarter that hes not going to branch out as independent if he looses. Friendly wager :) (Its going to cost more to mail the quarter but it would still be fun) . I would love to see a 3 man 1 woman race this year. Sure would make for an interesting election
Two things: 1) I believe we're speaking at cross-purposes. If Sanders loses the nomination, I don't expect him to run as an independent. I expect him to basically become a PAC, a la Avaaz or MoveOn. It is my opinion (and the opinion of a lot of clever people) that Sanders ran primarily to shape the narrative; winning the nomination would be icing on the cake but not the whole goal of his campaign. 2) I coulda sworn you were up in Seattle somewhere, so the wager should have been a beer. But again, I don't think we're on opposite sides on this.
Graduate this spring. $55k in loans. If my parents weren't in the position they were in I wouldn't have attended school at all. Lucky they let me eat their food and sleep in their house still. Grad school is off the table because I can't afford it. This makes a lot of sense, and I feel for those colleagues of mine that will struggle.
One thing that surprised me is how little people defaulting owe. Maybe that's just the cost of crappy useless diplomas that people get and can't use but wow that's not hard to pay off. If you just put off buying a car and instead put the money for car loan, gas, insurance, and maintenance minus a bus pass towards it that could be paid off in just over a year. Of course that only works for the person in the article and plenty are stuck in minimum wage jobs but still it's not impossible to pay off. I can't imagine just having that debt hang over me for a year.Most borrowers who have defaulted owe relatively little—a median $8,900
Sorry this took a bit to respond to, but I've had trouble typing this out. This isn't stuff I like to think about and it seems like kleinbl00 has explained some of it. Here's what I typed out though, partially stemming from personal experience. . . The thing is though, $8,900 is a lot of money for a large number of people. For paying back student loans, that's about $100 to $150 a month, something a lot of people can't afford. Let me break it down for you a bit, so you can see where I'm coming from because I found myself in this trap. Here we go . . . Let's take a person, like me, college drop out working 2 jobs to make ends meet. Only, unlike when I was working 2 jobs, now thanks to Obamacare, the number of full time jobs out there is much lower. Now, people are working 2 part time jobs, max hours, with no benefits. That's two jobs, maybe above minimum wage, at roughly $8 an hour for 50 hours a week. That breaks down to . . . $400 a week or about $300 after taxes. $1600 a month or about $1200 after taxes. That's about $20,000 a year or $16,000 after taxes. Money is fucking TIGHT. Here's the wild ride we're going down, and trust me, it's painful . . . You take home $1,600 a month. Take away $500 dollars for rent. Congrats, You're down to $1,100. Now take away an additional $300, because you have to pay for utilities and your phone on your shitty plan. Now you're down to $800. Now take away another $300, because that's your money for your car insurance and gas. Heaven forbid you still owe money on that car because that's even more coming out of your pay. Now you're down to $500. Take away another $150 for food and another $150 for health insurance and you have yourself at the end of the month, $200. That's $200 dollars flex room, before student loans even come in. Here's where things get shitty. Your car? It's a 15 year old GM J Body. Something breaks on it once every three months. There goes some of that money. What's that? You got a minor cold that somehow became an ear infection so bad that you have to go to the doctor because you woke up to literal puss oozing out your ear? That'll be an $80 copay for the clinic plus another $20 for antibiotics. In reality though, you spent half the day getting that taken care of so you're actually out more money, because you're not spending time working. After you get home from a long, half day at work because you work a shitty retail job, you find out that one of your roommates blew part of his money on a $25 dollar pizza delivery, instead of real food like rice and eggs. That's not the worse of it though, he bought that pizza to soften the blow of him getting fucking fired from his shitty ass job so now you have to cover his part of the rent until he can find something else. Now your rent just went from $500 a month to $750 a month and now you're hemorrhaging money every single month until he finds something new because you just can't kick him out, he's like family. Congratulations. You're now in a massive downwards spiral and you haven't even touched your student loans yet. Your debt is getting worse by the week and even when your roommate finally finds work again, climbing out of the debt will be that much harder, because you not only dug your hole deeper, but possibly wider. To make matters worse, if debt wasn't bad enough, the psychological pain of the inevitable collection calls and knocks on your door from the landlord will make things worse. Six years later, you're still afraid to pick up the phone whenever an unknown number calls you. So many things go wrong when you're poor and everything that goes wrong ends up costing you money, making things worse and worse. There's a reason why savings are called "safety nets." Being able to afford to take care of problems when they first show up, keeps them from getting worse down the road, literally saving you money in the long run. You have to have that money to begin with though, to make things work.
http://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06 8900 is far, far more than most families' emergency funds.
And that is why 2/3 of bankruptcies in the US are due to medical debt. My car accident just hit $10K in bills, and if it was not for the car insurance paying that I'd be a world of hurt... and I don't live paycheck to paycheck. I think a lot of these types of conversations deal with that just about nobody understands how much $10,000 is exactly. 10K is 6 months minimum wage. It's a LOT of money to have in hand all at once.
And that'll fuck you up, too. had a friend who didn't make the best decisions... one of which was to borrow his buddy's road luge on a corner that the buddy didn't want to try. He ended up with an airlift, 6 months in traction and $150k in medical bills that, surprise surprise, he disbursed through bankruptcy because what else are you going to do? So he gets through the bankruptcy and he's going to college and he's got his degree and he needs to buy a truck and his loan comes in at an I-shit-you-not 18% interest because with a bankruptcy on your credit report, you are persona non grata for a decade, y'all. Meanwhile I'm much the same only without the bankruptcy and my car loan cost me 2.2% the same year. Which is just numbers but my $10k car over a 2 year loan cost me $231 in interest. His? $1982. Same loan, only I'm paying $75 less a month for it. Nissan offered to lease me a Versa for 24 months. They wanted $79 a month and $1000 down. Because his credit is shit and my credit is great, I can buy his car and lease a brand new Versa and be within $4 a month of his payment. Realistically? My credit is good enough - and his credit is bad enough - that I can literally afford to lease him a car for the difference between him buying a car and me buying a car.
And he's paying more for every form of insurance with a shit credit score. Nobody will believe me on that, so source for Car insurance here. If you have excellent credit in Kentucky and a DWI conviction, you pay roughly $1400 less than a guy with a perfect driving record and shit credit. If you have a credit score in the 600's you cannot get life insurance, period. So if you have a family and want to protect them if you die, nope. And the ACA exchanges also do a credit score check and base prices accordingly. So you pay more and get offered higher deductibles which eat into your income. Add that owning a house is out of the question so you need to rent, which depending on where you are ends up robbing you of net worth, equity to tap into when times get hard, etc. I have the income and credit that I can go out and buy two houses in the $100,000 range with minimal down and rent them out for what a guy I know got on his mortgage for a $80K house and 15K down. He got divorce raped and missed a mandated child support payment and has a wage garnishment on his record. If you think bankruptcy is terrible...Realistically? My credit is good enough - and his credit is bad enough - that I can literally afford to lease him a car for the difference between him buying a car and me buying a car.
We afforded it, barely. It was a shitty chunk to pay, especially since it did exactly fuckall unless we were in a car accident. But again, we're white, college-educated, upper-middle-class showponies. Masters of the fuckin' universe. Guy I bought my last bicycle from owns three stores. Has two daughters. Is a Mexican immigrant. Pays $3k a month for comprehensive.
Sell the car, put the monthly cost towards debt minus the cost of a monthly bus pass. You'll also save all that money that would have gone towards maintenance. I get some things are different in America as in you don't necessarily need extra health insurance where I live and there are a ton of government grants to cover tuition for low income families which frees up some more money so I'm seeing this from a different perspective but what so bad about the bus ? I feel for the people who are working minimum wage, taking the bus and still can't afford to make payments but not the person with the car.
Cars are kind of a necessity in the US. Like what mk said, if you live near a city, more often than not a lot of jobs average to about fifteen miles away, with no bus access near your house, cause living on the outskirts is cheaper than city living, unless you're willing to get shot. If you live in rural places in states like Ohio, Wisconsin, Lousiana, etc., cities are few and far between, so you need a car or know someone with a car and the same schedule as you to get anywhere. The catch is, when you work two part time jobs, your schedule is constantly changing, so you pretty much need a car of your own, whether you want one or not. More often than not, no car means no job. Seriously. When you go to job interviews, you'll constantly be asked "Do you have reliable transportation?"
Many places in America don't have buses. Here in Southeastern Michigan, most residents would be very hard pressed to find a bus that can take them from their neighborhood to where a job might be. There are bus systems, but they are very sparse in routes and schedules.
Its hard to really compare parts of the world. On one had its true that America has a shitty bus system but on the other hand you read these stories about how people in the Philippines have to commute for 3-4 hours a day walk 5 miles just to work as a maid and earn barely enough food to prevent starvation and pay for bus fare. The problem I think really is "quality of life". Its theoretically possible to work 80-100 hours a week in 3 shitty minimum wage jobs to pay off student loans if you are motivated enough but its requires a discipline that a lot of people don't have. And the incentive isn't really there, you aren't working to prevent starvation you are working to pay into this nebulous account. Even if you do pay it off its not like your life is any better for it. So you do enough to get by (which could mean 2 shitty minimum wage jobs) and you don't bother with paying loans. For a lot of Americans out there there isn't a lot of "Hope". They aren't seeing their friends and peers move ahead and get out of poverty, instead they are seeing those friends and peers get crushed and dragged down so all they are doing is trying to say afloat.
I guess the States is a lot different. Being 22 I listen to people all the time talk about how there isn't buses or how they can't pay off their debt when they really easily could. Then there's the fact that students from low income families will have most if not all of their tuition covered by the government so that's not really a problem. What you're left with is the people who just have no idea how to survive on their own.
I feel as though I was pretty clear in my original post that there are people who get stuck working minimum wage or get a crappy useless diploma. There's obviously people who will still not be able to pay off a debt under 10 000. There are people who will never and have never considered buying a house or car. If somebody doesn't have a car to begin with they can exactly sell a car and get a bus pass now can they. So no this situation was never meant to apply to everybody but that's no reason to deny it isn't a solution that would apply to many people. A few comments on the internet aren't going to change what I see all the time from people who just don't know how to manage money.
We've had discussions about "what you feel is clear" vs. "what is clear" before, though. So before you get condescending and pedantic while also getting all "sorry/not sorry" about the situation, consider this: There's a very real problem in the United States related to structural unfairness and systemic disadvantage towards the poor. That problem persists so long as the people who can actually do something about it - the NOT poor - dismiss it as a function of sloth and/or incompetence, as you so clearly want to do. Further, by painting the poor as lazy and/or stupid, ALL of the problems faced by the poor become functions of being lazy and/or stupid. If it was a "solution that would apply to many people" those many people would likely be applying it, right? Money's a lot easier to manage when you have some. Take my bus adventures: they were purely academic. I had three credit cards, a job, financial aid and a working automobile I got a rippin' deal on because I was dating a psychiatrist's daughter. More than that, my bus pass was free because I was a student at a 4-year university (although I could sell it back to the U for $38 a quarter, and I did almost every time because I wasn't made of money either). So there I am, saying "fuck that" to 5 hours on the bus for my $75 a night job because I can drive it in an hour and because I'd have to sit around until 6am to come home. But when I worked swing shift at 7-11 I had coworkers that took taxis to work. That was their only choice, because they couldn't afford cars and because the bus lines in that town stopped at midnight. $6.50 an hour and they're blowing $15 each way just to get to work. Manage that money. The reason so many people don't use your solution is because for so many of them, it isn't a solution. That means we need other solutions. That means we need to have discussions about how to solve intractable problems that we don't want to consider because it reveals the inequality that we spend our entire lives sheltering ourselves from and pretending doesn't exist. Look - my coworker that spent two thirds of her salary just getting to work? That chick was tryin'. I'm pretty sure half of her remaining salary went towards smokes - nobody's perfect - but I'm also pretty sure that her actual living expenses were covered by welfare. So here she is, schlepping her ass to work every day for net $15, because it kept her safety net functional. And here I am, paying tax dollars into the system so that she can give $30 a night to taxi operators. It doesn't take much debate to determine that paying $20 in taxes to subsidize public transport is a net win for everyone but the taxi company but it takes even less debate to determine that she's not having a rough time keeping her head above water because she's foolish and/or impulsive. There's EVERY reason to deny that your solution is a solution. Just because our opinions come from the Internet doesn't mean they're invalid... particularly when they're backed up with data.
I'm pretty sure I will always find it weird when you call somebody else condescending. If your default tone can be described as condescending that is how people will respond to you and I'm a little surprised you aren't used to it by now. The problems you are talking about are related to crappy public transportation and expensive healthcare, not student debt. If people finish school with $8 900 in debt they likely dropped out or got a useless diploma from a private college. Sure that isn't a small amount to everybody but relative to what others spend on tuition it's very small. Even if they didn't have student debt to pay for the public transportation would still be garbage, healthcare would still be too expensive and they would still be struggling to keep their heads above water. What's fair to say is that I certainly didn't understand just how bad things are in American, because 1) I don't live there and 2) for every person who tells you how bad things are 3 more downplay the hell out of it. I have no desire to pretend like everybody who is poor is merely bad with money but I don't see the point in ignoring that we don't teach people anything about personal finance either. We also don't teach people to take out student loans unless they are sure they will actually pay off. I know somebody now who's in her third program because she has no idea what she wants to do but as long as she keeps studying interest wont start accumulating. She actually received grants to pay the tuition every year and the loans where for living expenses. Nobody teaches young people anything about this shit and instead just tells them they have to do it. We actually help many people go to school without accumulating to much debt where I live and we still have a problem of young people accumulating useless debt. I'm not saying opinions on the internet are invalid, what I'm saying is that I'm not going to completely abandon an opinion that many people just need help figuring out personal finance because other people have different experiences. That doesn't override what I see from a lot of people who would have been helped a lot by a simple finance class in high school. What I will admit is that on top of this issue America has A LOT of other issues which I wasn't aware of to work on whereas that's not such a problem where I live.
I'm taking the time to pause A Fistful of Dollars to respond to this (great movie by the way, as is Yojimbo) because I like you and hate this topic, not for what the topic is, but because of the emotional weight behind it. I think though, that it's important, because here in the States, the poor are villianized by everyone, even themselves and I think a bit of perspective is important if we're to try and fight this issue. The problem with being poor is lack of money. Period. This lack of money manifests problems in so many ways and they often overlap and intersect each other that it creates a weighted net, to keep you tangled up and weighed down. There are a lot of problems in America. In some parts of the country, things are a bigger problem than others. In New York City and Chicago for example, public transportation might not be an issue, but rent is expensive as hell and food deserts are a threat to the well being of you and your family. The neighborhoods the poor can afford to live in often have problems with crime and disease and the general environment has a psychological impact on the people that live there. In places that are less dense, like my example of Ohio and Wisconsin, rent is much more manageable, but since things are more sprawled out, transportation becomes an issue. Food might be more abundant as well, but if the nearest Wal-Mart is three towns over, you might have to settle for the mom and pop grocery store down the road for the majority of groceries. Their selection won't be as good and you'll pay a higher price. A quarter or two on every piece of food you buy from them quickly adds up. Under normal conditions, people can balance things out relatively well, but it is very much a balancing act. Once you start having problems with your car though, or your personal health, or the people in your lives that are supposed to help support you, things can go pretty sour pretty quickly. What's harder, is sometimes the social safety nets you think are there for you, really aren't. For example, when I was having money problems, I knew there was no point in my going to a food bank. They'd see that I worked two jobs and had no dependents, so they'd turn me away. When you're poor, your options are limited, robbing you the flexibility to creatively solve problems. That's okay. True story, America is a huge place. Poor people in Maine probably have a different experience than poor people in Florida who probably have a different experience than poor people in Texas. Poor people in the South West probably don't have to complain about their heating bill, but poor people in Maine probably don't have to worry about suffering from heat stroke because they don't have central air. Different people have different problems and experience them to different degrees. As for the people who downplay how hard it is being poor, we only have our selves to blame. For some reason, Americans in general have no problem with victim blaming, so when people who are poor fuck up and get taken advantage of, it's obviously their fault. Another issue is, a lot of Americans have a lot of pride. When I was going through money problems, I never once thought about going to my parents for help nor did I try to seek help from my local community like the churches around here. Would they have helped me if I asked? More than likely. Did the thought of asking ever cross my mind? Not once. But I did ask my peers for help, because they know what it was like to have the problems I had and so I didn't have to fear their judgement. When my car was broken down, I asked for lifts from anyone who was willing. When I was desperately hungry and pay day was two days away, I asked people to float me for lunch. The thing is though, the only reason I got help when I asked for it because they knew I would repay them when their time to ask me for help came. If I didn't, they wouldn't help me again. My parents did teach me about personal finance and responsibility. They taught me the importance of a good work ethic and to playing safe bets. The thing is though, when your income is really limited, all it takes is a mistake or two to throw you over the edge. My money problems came from renting a place I couldn't afford and having an irresponsible room mate that couldn't hold down a job. It took a while to get myself out of that hole and it took even longer to recover from it. It also took me willing to be homeless, swallow my pride, and live on my friend's couch for a month, commuting 45 minutes to and from work each day to make it happen. It was not fun and I think I would rather die than go through all of that again. I'm not being hyperbolic when I say that. The thing is, a lot of people who are poor know they're being fucked with. Check cashing fees, pay day loans, wage theft and last minute schedule changes from employers, bad landlords, on and on it goes. When you're poor though, a lot of times those are the only options you have. Back to my homelessness and living on my friend's couch. I had to leave my living situation, room mate and all, but I had absolutely no chance of paying a security deposit and first month's rent on a new place. So I cancelled my lease, left that place, and crashed on my friend's couch. The only reason I was able to get out so early was because my girlfriend at the time, now wife, was an angel and was willing to trust me enough to get a place with me. The security of living with her, her being responsible and making money to combine with my income, was exactly what I needed to get out of debt. I'm now in a much, much better financial place today and I live a good life because of it. But, I literally could not have done it without her. Not a lot of people get a saving grace like that. This is indeed a problem. Landlords and employers take advantage of people all the time because they don't know the laws. Predatory lending companies take advantage of people who lack the financial savy to understand how interest and late fees work. Ignorance is a huge issue, but the fact that there are people out there who are willing to prey on the ignorant to make a living are a huge part of the problem. Don't feel bad about having an opinion and trying to think this stuff through. You actually have a very good idea about the whole cars thing in general, but not specifically cars themselves. Cutting unnecessary expenses to help tackle debt goes a long way. It's also important though, to not look down on poor people who spend money on things like movies and booze. Entertainment and leisure is important for everyone and it gives us a much needed psychological boost to help deal with the hardships of life. Look, this stuff is hard. It's heavy. It is devastatingly painful to witness and it is even more painful to live. When people like kleinbl00, mk, steve and others talk about this stuff, it's because why they themselves might never have had this problem, they're smart enough to understand some of the trends and what causes them. (Edit: That's not to say you're not smart, because you very much are and I love seeing your comments on Hubski.) They're people you can listen to about this stuff because they probably know. You can listen to me, because I lived it and the majority of my peers are still living it, it's such a part of me that I don't think it'll ever go away, no matter how badly I want it to. Let me just end with this. There are a lot of outreach programs for poor people out there, from churches to food pantries to social programs. They help tackle issues of all types caused by poverty, taking care of both short term problems and helping to fight the fight in the long run. If this is something that even remotely causes you concern, I highly encourage you to educate yourself on some of the resources out there and how to find them, that way if you ever see someone you love going through a hard time, you can lend them a hand.The problems you are talking about are related to crappy public transportation and expensive healthcare, not student debt. If people finish school with $8 900 in debt they likely dropped out or got a useless diploma from a private college. Sure that isn't a small amount to everybody but relative to what others spend on tuition it's very small. Even if they didn't have student debt to pay for the public transportation would still be garbage, healthcare would still be too expensive and they would still be struggling to keep their heads above water.
What's fair to say is that I certainly didn't understand just how bad things are in American, because 1) I don't live there and 2) for every person who tells you how bad things are 3 more downplay the hell out of it.
I have no desire to pretend like everybody who is poor is merely bad with money but I don't see the point in ignoring that we don't teach people anything about personal finance either. We also don't teach people to take out student loans unless they are sure they will actually pay off.
Nobody teaches young people anything about this shit and instead just tells them they have to do it.
I'm not saying opinions on the internet are invalid, what I'm saying is that I'm not going to completely abandon an opinion that many people just need help figuring out personal finance because other people have different experiences. That doesn't override what I see from a lot of people who would have been helped a lot by a simple finance class in high school. What I will admit is that on top of this issue America has A LOT of other issues which I wasn't aware of to work on whereas that's not such a problem where I live.
This is far from the most important things you hit on, but great point about the psychological impact of where a person lives. Recently started to develop an interest in psychogeograpy, maybe this is something veen knows a bit about.The neighborhoods the poor can afford to live in often have problems with crime and disease and the general environment has a psychological impact on the people that live there.
My 1100 page geo-bible has a page on it, linking it to situationalists. I didn't know there was a specific word for the idea that psychogeography stands for but it is something that almost all human geographers either take for granted or allude to with the word place. I even wrote about it. Case in point: this essay/rant by Mike Davis, where he burns LA to the ground for being a terrible place. It was written 26 years ago but just as relevant today.
I won't pretend to come from abject poverty, but my childhood was LEAN. I know what powdered milk tastes like. When I was 12 and got MY FIRST PAIR OF JEANS (as opposed to the clothes my mom had made for us my entire life), one of my older sisters freaked out because she didn't get a pair of jeans until she was 16 and had to pay for half of them. When I write about poverty, it comes from the lens of my own lean childhood, but really more from my current work at church. I spend a lot of time trying to help people lift themselves out of poverty. Poverty is super complex. There are no easy answers. It is often a learned behavior. In this context of student loans - I don't feel like I have the street cred to talk about it other than academically. I was fortunate to go to Uni in the mid 90s to a private university that is (strangely) much cheaper than almost every public school I know. I received some grants and scholarships and only had to borrow a little bit. I was fortunate to have a fairly solid understanding of debts and loans - that I took when I was 22.... not when I was 18. Wow - this comment is all over the place. I should probably delete it... Schools that prey on students and promise things they can't deliver SUCK. Students who borrow more than they should for an english degree are asking for a life of pain. The system that has grown like a greedy tumor at the expense of so many people's financial ruin makes me sick. There are no easy Macro numbers.... but there are some micro solutions that can work for each person.steve and others talk about this stuff, it's because why they themselves might never have had this problem,
I think where my thoughts come from is that when I see a figure like $8,900 I am seeing the people in my life who have no idea what they're doing. Not people who have it rough from the start necessarily but also not people who have it crazy easy. Just "middle class" people who's parents where never able to save for their education. Those people also don't get grants so they either have to put off going to school or get in debt. What I see is how incredibly easy it is to get $10 000 in debt as a 20 year old. Whether that's by signing up for a program you don't actually care about just because it's what you are supposed to do or moving out with the wrong people. I remember my friend graduated from engineering debt free because he saved from when he started working in high school. I worked the same job as him, with similar hours and had nothing to show for it. Literally nothing and I'm the norm not him. I still don't understand it because it's not like he was a recluse. He had a car, he went out drinking, he built computers ( I don't think that's cheap), he just lived life generally and still managed this. I can't figure out how he did it and I don't think anybody I know could either. When I look at most of my friends though, they took on debt to go to a program and now they can't even use it. It's really easy to just say screw it to paying it off in that situation because you don't actually gain anything obvious from doing it. They got stuck with bad roommates or were the bad roommates. It's so easy for a young person to just move in with their friends because why not ? Then they get stuck with all this money to pay when someone can't and all of a sudden it just gets out of control. Especially when now this person finally finished school and wants to get on with their life. Maybe they met somebody and they want to have kids so they think screw all that debt it doesn't really matter. It was money they had to spend year ago for one stupid roommate which they put behind them. People don't want to put off their lives to pay off the debt so they just don't pay it. In fairness, this is an article about students in America so my experience is likely less realistic and I should have known that going in. There are tons of grants for students for low income families in Ontario and our federal government introduced plans to make it so that until a person is making $25 000/year they don't have to make a payment. Interest won't accumulate over that time either ( well it does but the government pays it ). I am the poor person spending money on entertainment and booze. :) I don't even blame the people who find themselves in this situation, most of them where my friends who where just doing what they thought they were supposed to do and now years down the road are pissed off about having to pay this money back. Edit: I'm also pretty sure he didn't deal drugs before anybody says that.
This is an interesting concept for me... I know this has become a bit of an expectation, or a norm - but I've never understood it. Why is it my parents' responsibility to pay for my education? And now that I have a teenager - why is it my responsibility to pay for his? Of all of the contributing factors to the cost of education... I think this is one. Why WOULDN'T a school charge more when they know Johnny's parents are paying instead of Johnny himself? I don't know... I'm weird about this topic... if a kid (I shouldn't' call him/her a kid...) - if a young adult wants more out of life than minimum wage, then he/she should get some valuable training. Take a forklift operator certification class. Become a plumbers apprentice. Shoot - my wife hated Uni. When she finished her Associates degree, she bailed and went to Medical Assistant school. She made a great career of that for a few years. You wanna be a tenured Anthropology professor at a quaint little liberal arts university? Heaven help you - it's gonna cost you, and you're gonna get paid peanuts.Just "middle class" people who's parents where never able to save for their education.
I'm not really sure what came first, the expectation that parents help out or the high price. My parents have helped out how they could but none of us actually went to University. That always makes things substantially less expensive and I don't know how much they would want to help out if they didn't think the programs would pay off either. I feel like that would result in a lengthy wtf is your actual plan discussion. I don't really know anybody who could completely finance their childs education. I still made minimum wage when I drove a forklift :( but I agree with your general sentiment because these things are really valuable. I could have got my certificate and worked somewhere that paid more but I wasn't in to that. I have a few friends who ended up as plumbers or ironworkers which are really smart careers. Most parents I know want to help because they know it will put their kids on the right track so they won't have to help out much later in life. Granted that backfires sometimes and a lot of people just really can't help. I think all in all parents are more likely to either help or want to help if they know the program will get their child somewhere.
What you're describing sounds a lot like for profit colleges, like Devry or Phoenix. I wonder if for profit colleges are a thing in Canada. Here, in the States, they are. They're a big problem too, they're one of those kinds of companies that profit off the poor. Basically, they convince the poor, minorities, and former servicemen into going their schools, promising cheap and easy education. They're extremely aggressive in recruiting and they often go after people who can get loans for school easily due to their social status, but don't know any better to use their loans for trade schools or community colleges. The degrees they give you are worthless, because they have a reputation for teaching crummy classes. What's worse, most of their credits don't transfer to real schools. When you combine for profit colleges with smaller colleges who often lose accreditation, a lot of people are left high and dry with debt. I wonder if living with a lower income is easier in Canada too, thanks to your social health care and probably cheaper rent and such. I'd actually love to see a comparison of Canada's food welfare programs versus programs like Foodstamps and WIC here in the States. God knows you probably do have better health care, even with waiting lists. Hell, I don't live in Canada and even I had to wait a month and a half to see a doctor more times than I like to admit. It sucks. The least they could have done was make it free.
We have thing called career colleges which I think are very similar and receive similar complaints about crummy classes. A friend of mine went to a college in my city which had a really good Massage Therapy program with these two girls who had transferred from one of these colleges ( I think it was Everest) and they were so behind they pretty much had to restart. I can't imagine how pissed off I would be paying off the debt from that school. Even reputable colleges however have programs which don't really benefit the student as I'm sure any school does but people do it since they think they should. Which is a really crummy way to go about things. My only friend who really has his life together joined the military, and from constantly looking at people struggle I'm determined to just pay it off as quickly as possible. For me to achieve that I tell myself it's a small amount and life will be so darn grand after I'm done. If I told myself it was a huge amount then I wouldn't see how I was able to pay it off and I would just give up. It's like I get you aren't supposed to have everything figured out at 20 but I really wish they didn't make it so easy to fuck everything up at that age. I'm getting that impression ! I mean I got lucky in a lot of ways, my first job as a part time cashier gave me 100% prescription drug coverage so on top of not having to worry about doctors visits I also didn't worry about prescriptions. On top of that I got 10% off groceries which might seem small to start but it's not. I kept that job through college because on top of that I was guaranteed a certain number of hours for being there for a long time. After that I worked in a bar and I am fully aware I got that job because of looks/body. OH and also server wage in Ontario is higher than some minimum wages I've seen in the states. I could have easily stuck with that and done quite well for myself but I wanted to travel for work a bit. The local doctors office that most of my family goes to is amazing too, I don't know how they swing it but they have a counselor you can see for free. The wait list can be like 3 week long but as you point out you've waited longer to see a doctor that you paid for. So ya I got lucky in a quite a few things. Obviously not everybody around me has that stuff though, and they still seemingly have it better. Everybody complains about the buses but they are actually really good. I'm not saying it's easy to get everywhere or particularly safe but the buses are there. Actually they started a new thing in my city where after a certain time you can ask the bus driver to let you off at a certain spot along the route that's safer for you. I've had to add 30 minutes to my trips because I didn't feel safe at the stop I should have got off at and I've also had to walk 30 minutes to the main bus since one bus didn't run early enough but all in all it's pretty good. I don't know much about our social programs in comparison but I know they are pretty good. I also know we have things that don't exist in the states like the child care benefit. For people who live in rural communities that aren't near major cities it kind of sucks because they don't have as many opportunities to get ahead. As far as thing like rent and utilities go that varies a lot depending on which province you are in which I imagine is similar to the states. Even then though you can generally live in a crappy neighborhood without actually worrying that much about violence. I mean I lived in those neighborhoods, and sure one of my friends got stabbed but it's not like that's the norm. On a long enough timeline somebody is going to get stabbed everywhere. So we technically have "bad" neighborhoods but I wouldn't compare them to ones in the states. Other than first nations reserves that is, and that is a whole complex problem. I wonder if living with a lower income is easier in Canada
Holy shit, yeah, Everest is one of those for profit colleges. It's absolutely insane to think that these places actually exist. A lot of my old friends are in the military. They either never went to college and ended up joining the military almost right away, or they went to college, dropped the idea for one reason or another, and joined the military as a backup. For a lot of people, there's a lot of appeal to becoming a serviceman. Garunteed pay, decent benefits while you're active and after (kind of, the VA is actually pretty fucked up), a promotional structure, on the job training, etc. The only downside is, a few of them have decided that career military is not the way for them to go, so when their time of service is up, they don't re-up. Now they're almost back where they started, because despite what military recruiters tell you, on the job military training doesn't always translate to marketable skills in the civilian world. As for poor neighborhoods, while the actual risk of being a victim of a crime is statistically higher, sometimes people blow it a little out of proportion. However, whether or not you actually ever get stabbed or mugged or burgled is a bit of a moot point. The environment alone can be draining. When you're not home, you're worried about your possessions at home and whether or not they're safe. When the neighbors down the way are being loud as fuck for a place that already has thin walls, up until 3 o'clock in the morning, the loss of sleep has a very real impact on your mood and ability to be productive. When the pipes in your apartment building freeze and burst and your landlord takes a week to fix them because he doesn't give a fuck about the law, there goes your ability to shower and make yourself coffee. On and on it goes. Not only that, but I sometimes think that the actual worry of being harmed is more damaging than actually being harmed. It can be really difficult. We've both been very lucky and I think the majority of the people on Hubski feel the exact same way. In comparison to what's going on in a lot of the world, we have it pretty alright. You gotta give yourself credit though, cause luck is only the half of it. You're also smart and it sounds like you're hard working as well. You've made some good, well thought out decisions to get you where you are in life right now and if you keep making good decisions, you'll probably turn out a little "luckier" every year. You got a lot to be proud of. :)I mean I got lucky in a lot of ways.
They really are the worst, they prey on people and make them think that going to their crappy school will result in actually getting something. The thing is to in my city we have a really good college that offers the same programs but obviously better which makes it even harder to find something after the fact. Like not only does your diploma pretty much suck but you have to compete against people who went to the good college for jobs. It's just not going to happen. Something interesting I found yesterday was 54% of borrowers said that if they could do it over they may have made different college choices. It would be interesting to find out how many of those students went to these for profit colleges.
It seemed low when I look at my friend but really there was a bunch of people who did pretty good. I just don't talk to those people. A couple of my friends have more or less accepted it and made peace with things too. My friend and I actually had a conversation the other day in which she was saying that although she knows she could have been in less debt she doesn't regret it. So I don't think people like her would say they would do things over even though it didn't pay off in an obvious way. Like I moved across the country and after the first night woke up with bugs crawling on me. Most people would regret that, and at first I did but in the end I wouldn't actually change anything. They even came back just before moving to fuck with me but I still wouldn't have changed things. I'm hoping, I mean the conversation has really shifted in the past years. Going to community college and then university is seen as a good option more as well and people are just starting to look at it differently in my experience. It's helpful to talk about how insane the cost is overall but that just doesn't help the people who want to go to school now and get on with their lives. It helps the next generation which is awesome but this one needs solutions too.
You're expending a lot of effort to see this as anything but a cost of living problem. You've walked back from calling the poor stupid or lazy, but you still seem to believe that if only those poor benighted souls could get some book learnin' about budgets and whatnot all their problems would be solved. This link is for you.
You honestly think everybody just knows how to handle personal finance ? I very clearly pointed out that America seems to have ALOT ( I even wrote it all big and stuff ) of problems to work on which I wasn't fully aware of. Many Americans love trying to point out that their health insurance isn't actually a lot of money and it's waaay better than the system we have in Canada. So even though we are told about these programs to help the poor pay for healthcare in America apparently that was mainly BS. I very clearly explained that these are problems which are apparently much bigger than people like to admit (although I think that's just how they respond when Canadians get smug and they want to say no no it's not that bad). The thing is as much as I can see a cost of living problem I can't really ignore the people who have no idea wtf to do seeing as they are my peers. If they weren't I probably wouldn't see the problem but holy shit it's a problem.
Who are these people? Most of the people I know admit that healthcare is jacked up around here, and they're paying a lot without getting a lot back because of Big Pharma, government subsidies, etc., and sure don't comment on (dis)advantages compared to the Canadian system when most of us are just trying to figure out how the hell our own healthcare system (doesn't) work...Many Americans love trying to point out that their health insurance isn't actually a lot of money and it's waaay better than the system we have in Canada.
I sometimes get the impression it's a response to outsiders when they criticize the system. Like how people will critize their own family but when somebody else says something all of a sudden their family is amazing. I've had people talk about how terrible waiting times are here and how their monthly payment isn't that much. Or the common bit about how we pay all our money in taxes. How there is programs that help the poor so it's not actually that bad. Personally, I always think our system is better since I know my family wouldn't have a roof over our heads without it but just how bad the American system is has been downplayed a decent amount over the years.
Job I worked in college was a 30 minute drive away. it was a 2 1/2 hour bus ride, and the buses stop at midnight, and I worked until 2am. There are probably mystical fairylands where buses take you everywhere you need to go all the time, but growing up, I didn't so much as see a bus until I took a trip to Mexico.what so bad about the bus ?
Out here in the sticks, if you do not have a car, you cannot get a job. Job ads will even state "Must have reliable transportation" as a requirement. The new Republican governor wants to start a jihad against public transport, so the shitty barely there stuff we have is going to be under stress as it is. And public transport in the suburbs is non-existent.Sell the car
Even if you could sell the car and get a bus pass, the buses in my area are going to take 2+ hours to get you someplace that it takes 20-30 minutes to drive. So tack on that time, and factor in the cost of a person's time - or, you know, just subtract the sleep that could have occurred in that time (cuz usually yeah, it's "i gotta wake up at 6 to take the bus to be on time for my shitty retail mall job where my shift start is 9:30) and think about that. Taking the bus means you have to get up at 6 AM to get to your shit shift at 9:30 AM and then, when your shit shift is over at 5, waiting til 6 to catch the bus and getting home at 8. Or so on. The buses don't run 24/7, so if you get off at 10, good luck finding a way home. And yeah, shit mall jobs, you will be getting off at 10 some nights. This is out in a fake city in the basic burbs, so I'm not talking NYC or LA or some shit. I don't know what their busing is like. But public transpo in the hubs like NYC, Atlanta, LA, Seattle, etc, is going to be very different even from the average American's shitty experience. Hell, it's my understanding that Atlanta is simply not made for public transport - the city's extremely spread out and it's hard to get from most places to most other places unless you have a car.
The one thing that doesn't get enough mention is bicycles and scooters. I think most people dismiss them as non viable in the US because they are dangerous but they are often significantly cheaper to own and use per mile than cars. In other countries they are much more common as a mode of transportation than in the US for that reason.
My dad bikes to work everyday, I don't even know how long it takes but it has to be over an hour each way, he's insane. Also very healthy for his age which is the up side of course. I'm going to just go ahead and assume though that we have more bike lanes where I'm from too.
I actually saw a statistic yesterday about how 7 of the top 10 cities for amount of people taking public transit to work in North America are Canadian cities. The reason the stat was that way too was because of the burbs. So apparently this is something we are good at and also investing even more money in. I mean my last job involved an hour and a half sometimes longer bus ride to go what would have been a 10 minute drive (I knit so it's never wasted time). For someone like me though that's awesome because my earlier option was carpooling in at 7 am, waiting around for one 4pm class then going back a few hours later because I lived way out in the middle of nowhere ( I very rarely attended this class). So when I moved and I had buses at my disposal it was amazing. But a big component of that is apparently Canadian cities are really good at public transit.
Also interestingly enough many Americans in this position can't actually "Sell" their car. In America if you are poor you get suckered into negative equity loans or leases. So many Americans don't own the cars they drive and would actually have to pay quite a bit to get rid of them.
Plus, if your credit is bad, you're often stuck with Buy Here, Pay Here dealers and they can be predatory as fuck.
That much doesn't hang over upper-middle-class white people. It hangs over my barber's daughter, who puts in two quarters towards a dental assistant gig but then she has to help take care of grandma. It hangs over my old laundry guy who co-signed for his nephew to go to ITT Tech. It hangs over people who were never going to get a bachelor's in anything but the late night commercials convinced them that a bold new future awaited them on the off-world colonies. I've mixed a stupid amount of reality TV. I've watched a stupid number of ordinary people scheme about what they'd do with their meager winnings. "Get out of debt" is far and away their biggest desire.
Here is the bizarre story of me "not making payments": By the time I graduated I owed about $40K. I agreed to pay $400/month to retire that and set up a dedicated account where I deposited that amount on the last day of every month and it was withdrawn the next day. About two years later the withdrawals stopped and I called the Bank, dozens of times over a course of several months, and no one could tell me why. Then I got sued. By the federal government because the Bank had claimed default and the Feds were the guarantor who had paid off the debt in full. When I received their documentation I saw that the Loan Consolidation Agreement was not the one I signed. It did not have my signature on it, the loan officer was different and the amount was several thousands of dollars higher. So the Bank had presented fraudulent documentation to the Feds to justify their claim of default. After about 2 years, the matter got to trial. The Feds went through their claim and I went through mine, then the Judge called us into his Chambers for an off the record discussion. He railed at the Plaintiff's lawyer about the fraud and I felt pretty good. Then he turned to me and said: "Did you take the money?' Yes, the lesser amount on the original Agreement. "Is it fair that a student pay back their loans?" Yes. Then he tells me I have a winning case but he is going to rule against me and I can appeal that if I want, which he knew I would not. So I ended the day with a judgement for I think $25-30K against me. Spoke with the other lawyer and their witness from the Feds afterwards and said: Give me a call and we will make an arrangement. I never got a call or any demand for payment. They also did not register the judgement against me. All that time I had still been putting $400/month in the account and continued to do so for almost 2 more years until I was sure they would not be coming after me. So I withdrew the money and shut the account. My theory is that the Bank forged the Loan Document and acted on the Guarantee so that: 1) they could get immediate full payment with zero risk; and 2) claiming this as a default artificially inflated the default rates which they could use as leverage when negotiating higher rates/fees from the government.