The Dr has 1/2 million in student loans!

[ronocnikral]

time out...so you are telling me that I can't travel the world, take some classes, get a few letters after my name and just get paid 6 figures without having to pay for it?

I have little compunction for this girl. it was her choice and as my pappy told me all the time - you made your bed, now lay in it.

i graduated in 2005 with $42k in SL debt. It all got paid off a year ago. My starting salary was $65k and has balloned over the 6 figure mark in 5 years.

here's the problem, kids skate away from home chasing their dreams of fixing the world. get some crap degree in something lame like photography or history. get out in the real world and figure out working at starbucks doesn't get them into a fancy car, big house and no frills life they see on TV. So...they then go get a master's degree, digging themselves even deeper into debt. a couple years later they pop out of the machine thinking they are entitleted to even more now, because they are more educated. well, teaching 3rd grade with teach for america is starting to wear on them, after all, they are well educated and should be paid more. so now they go to law school thinking they will be ballin' and rolling on 24's if they can become a lawyer. they get out of law school and find out there are lawyers every where and it doesn't pay $1m/yr like they saw on TV. They settle down with their decent salary and are pissed off b/c they are so educated and not making what they are worth. So...they attack the student loans, whine, bicker and complain about how much it is.

my cousin wants to become a patent attorney. he's all pissed off b/c he farted around in undergrad and took 6 years to get his petroleum engineering degree and came out a couple years ago when it was impossible to get a job. so...now he has some crap job with a service company. i asked why he was going to law school. he told me he has always wanted to be a patent attorney. I told him he already has an engineering degree, buy the patent bar study program off of ebay for a couple hundred bucks, study for a couple months, drop a few bills on the test and pass the patent bar. even if you had to retake it, you could still pass the patent bar for under $1000. why go to law school, if all you want to do is file patents? he wants the $40,000 version I guess. not to mention if he would get himself together he could make slightly less than a patent lawyer doing petroleum engineering, no schooling required.

i don't feel too sorry for these people. while it's good to have dreams, a little reality check is nice.

[Orchidflower]

ronocnikral, that hits it on the head totally!

[Emeritus]

Quote:

Originally Posted by ronocnikral t my cousin wants to become a patent attorney. he's all pissed off b/c he farted around in undergrad and took 6 years to get his petroleum engineering degree and came out a couple years ago when it was impossible to get a job. so...now he has some crap job with a service company. i asked why he was going to law school. he told me he has always wanted to be a patent attorney. I told him he already has an engineering degree, buy the patent bar study program off of ebay for a couple hundred bucks, study for a couple months, drop a few bills on the test and pass the patent bar. even if you had to retake it, you could still pass the patent bar for under $1000. why go to law school, if all you want to do is file patents? .

An enrolled agent can file patents, but is not a substitute for being a patent attorney.
Its similar to the difference between being a nurse practitioner and an physician. Both useful professions, but by no means the same. I have students who have done both.

[plex]

Quote:

Originally Posted by ronocnikral my cousin wants to become a patent attorney. he's all pissed off b/c he farted around in undergrad and took 6 years to get his petroleum engineering degree and came out a couple years ago when it was impossible to get a job. so...now he has some crap job with a service company. i asked why he was going to law school. he told me he has always wanted to be a patent attorney. I told him he already has an engineering degree, buy the patent bar study program off of ebay for a couple hundred bucks, study for a couple months, drop a few bills on the test and pass the patent bar. even if you had to retake it, you could still pass the patent bar for under $1000. why go to law school, if all you want to do is file patents? he wants the $40,000 version I guess. not to mention if he would get himself together he could make slightly less than a patent lawyer doing petroleum engineering, no schooling required.

Oh man, cannot help but chime in on this. As Emeritus said, there is a huge difference between an agent an attorney, it is like the difference between a lab tech and an engineer, faster degree vs. no mobility and much lower starting pay, same field.

That said though, petro engineering is probably one of the worst backgrounds for going into patents, he is going to really have to make up for it with law school grades. This doesn't sound promising if he took 6 years to get an engineering degree, which is near the time limit for him failing out. I knew two guys like this, and they got their engineering degrees with low 2.0s after 6.5 years, and I was surprised they managed that even after retaking 1/3 of their classes. There is also a very wide range in difficulty between engineering degrees (the guys I knew were taking medium+high difficulty ones at least), which is why there are a lot less people with the more desirable ones for patent law.

[ronocnikral]

i recognize the difference between a patent attorney and a patent agent. my cousin said all he wanted to do was file and write patents.

i would at least get the patent bar under my belt before jumping into the law school thing...

[plex]

Probably true, it is like jumping into becoming a doctor when previously you were doing construction work. Completely different types of work, most engineers actually hate the type of work involved in law, because law uses a completely separate and unrelated set of skills from engineering. With how almost universally expensive grad school is, it isn't something that should ever be jumped into without a lot of thought.

[Alan]

Quote:

Originally Posted by Orchidflower Met a lady this week at the auto dealer waiting for the old oil/lube/filter job. We start talking, and she tells me her son has a degree in some fancy-type of engineering (sorry, engineers here, but I have no clue what it was), then gets a Masters in some advanced engineering--along with an MBA = 3 degrees$$$. She goes, "but guess what he does now?" He runs a sailing boat excursion company in Key West, loves it and is happy she said. She and I both had a good chuckle over it. She said he was making money, so...."whatever" was her attitude. I agree. (Is there some degree like biochemical engineering? That's what just popped in my head.)

Yes, there is such a degree and field called biochemical engineering. Its applications are used in the food, feed, pharmaceutical, biotechnology, and water treatment industries.

A sailing boat sails on water - right ?

[haha]

Here is some very intersting talkback on Cortney Munna's experience, as well as about the student loan fiasco in general. Goes far beyond "buyer beware, and they should have read the fine print" to deal realistically with the problem. One guy suggests putting the college counselind offices and lendesr on the hook too, rather than the taxpayer who got no benefit from the process. Another guy says that professorial "Follow your bliss" advice borders on malpractice, which I have believed since I was an 18 year old freshman. Also suggested in making bankruptcy possible for student loans. Taking that away was to me an obvious pay-off to the lenders in this space, to the detriment of student borrowers and teh taxpaying public of which I am most unfortunately a member.

The Case for College Accountability Daily Finance's Zac Bissonnette concurs, and argues prior to Lieber's New York Times piece that "Many colleges ... are signing naive students up for levels of loan debt that are destined for failure." When the financial aid offices do this, he argues, "the schools should at the very least share in the financial fallout."

When Drowning in Debt for College Doesn't Pay Off | The Atlantic Wire

[Westernskies]

No amount of education will guarantee future earnings. Hard work, high performance, tenacity, ingenuity, an ability to work with others, and making the most of every opportunity are what determines financial success, IMO.

Graduating with a degree (in anything) with no substantive work experience and/or a poor work ethic, a sense of entitlement, lack of responsibility, etc. is a recipe for future disaster. Having that piece of paper isn't the end-all many have been led to believe it is.

Many schools churn out graduates who don't know what it means to work for a living, what a dollar is worth or where that dollar comes from. It reflects a systemic lack of accountability in our educational system, (well-discussed in another thread here on FIRE...) which should also be teaching graduates how to make a living with their expensive higher education; otherwise it's just institutional education for the sake of education. Many profs eschew any type of financial discussion relative to their curriculum, probably because they have been cloistered in academia and don't have a clue what their graduates are going to be facing in the job market.

I've seen this firsthand with a couple of highly-educated family members, and with freshly-minted graduates who show up at interviews with nothing more than a sheepskin and a smug attitude. They believe they should be starting at wages far higher than their peers (degreed or not) with years of relevant work experience and proven track records..... many of these these graduates feel they are entitled to it, after all they have all this education and those damn student loans... hence the OP's story of the doc who feels her loans are just too much of a burden.

Earning a degree doesn't automatically equate to earning a living.

[ronocnikral]

most of these graduates are asking us to trust them with the right to vote, yet they are almost asking us not to trust them to take out a loan or select a career? or do they just want to have their cake and eat too?

[Texas Proud]

Quote:

Originally Posted by haha Here is some very intersting talkback on Cortney Munna's experience, as well as about the student loan fiasco in general. Goes far beyond "buyer beware, and they should have read the fine print" to deal realistically with the problem. One guy suggests putting the college counselind offices and lendesr on the hook too, rather than the taxpayer who got no benefit from the process. Another guy says that professorial "Follow your bliss" advice borders on malpractice, which I have believed since I was an 18 year old freshman. Also suggested in making bankruptcy possible for student loans. Taking that away was to me an obvious pay-off to the lenders in this space, to the detriment of student borrowers and teh taxpaying public of which I am most unfortunately a member. The Case for College Accountability Daily Finance's Zac Bissonnette concurs, and argues prior to Lieber's New York Times piece that "Many colleges ... are signing naive students up for levels of loan debt that are destined for failure." When the financial aid offices do this, he argues, "the schools should at the very least share in the financial fallout." When Drowning in Debt for College Doesn't Pay Off | The Atlantic Wire

This is from the article...

"The Case for College Accountability Daily Finance's Zac Bissonnette concurs, and argues prior to Lieber's New York Times piece that "Many colleges ... are signing naive students up for levels of loan debt that are destined for failure." When the financial aid offices do this, he argues, "the schools should at the very least share in the financial fallout." "


Now... I am all for holding some people to the fire... but let's take a look at the lady in question... Sallie Mae stopped loaning her money... should they take a hit?

The financial aid office does not get any 'income' from the loans... the students are paying for their college just like the ones who are paying cash... so there will need to be a charge to the students who use student loans to pay for their tuition to pay for the deadbeats...

And then do they get hit if they kick someone out and they now can not get a job.. back to our example... if the school kicked her out with 'only' $60k in debt, saying she can not have anymore at their school... and now she does not go to ANY school... do they get paid for what at the time was reasonable debt?

The problem is the rules are set up for someone to borrow that is NOT credit worthy... nobody will lend big sums of money to someone that does not have any means of paying it back (ok, start with the jokes about the subprime mortgages... I can take it ) ... so, you put the full burden on the student...

And even then... there are a number who do not pay... ever...


I think a good suggestion... and I just thought of this... so maybe it will be stupid... but why not limit the amount that can be lent to say... 2X the 'state tuition' amount... so, if you can go to State U for $18K, then the max you can get is $36K (sounds to high... maybe 1.5X... or even X...)... then, if you want to go to a high cost school... you either get grants, scholarships or scrounge around for the money... this will limit the max debt for eveybody...

[haha]

Quote:

Originally Posted by Texas Proud This is from the article... "The Case for College Accountability Daily Finance's Zac Bissonnette concurs, and argues prior to Lieber's New York Times piece that "Many colleges ... are signing naive students up for levels of loan debt that are destined for failure." When the financial aid offices do this, he argues, "the schools should at the very least share in the financial fallout." " Now... I am all for holding some people to the fire... but let's take a look at the lady in question... Sallie Mae stopped loaning her money... should they take a hit? The financial aid office does not get any 'income' from the loans... the students are paying for their college just like the ones who are paying cash... so there will need to be a charge to the students who use student loans to pay for their tuition to pay for the deadbeats... And then do they get hit if they kick someone out and they now can not get a job.. back to our example... if the school kicked her out with 'only' $60k in debt, saying she can not have anymore at their school... and now she does not go to ANY school... do they get paid for what at the time was reasonable debt? The problem is the rules are set up for someone to borrow that is NOT credit worthy... nobody will lend big sums of money to someone that does not have any means of paying it back (ok, start with the jokes about the subprime mortgages... I can take it ) ... so, you put the full burden on the student... And even then... there are a number who do not pay... ever... I think a good suggestion... and I just thought of this... so maybe it will be stupid... but why not limit the amount that can be lent to say... 2X the 'state tuition' amount... so, if you can go to State U for $18K, then the max you can get is $36K (sounds to high... maybe 1.5X... or even X...)... then, if you want to go to a high cost school... you either get grants, scholarships or scrounge around for the money... this will limit the max debt for eveybody...

I think you took a long way around the barn to reach the same conclusion that I and these other writers did- the responsibility needs to be put on someone who is in a position to understand what it means and who benefits from the lending. The school obviously does benefit (as does any firm whose product gets easy credit financing on someone else’s risk), as does the lender, as does the federal bureaucracy involved as does the student. No matter how perfect and cool and worldly wise and responsible all you tough love advocates think you were at age 18, I know I didn't know jack, and I know many young people don't either. So all parties get benefit, but one party is not truly able to understand the risk by virtue of being barely out of childhood. So which party gets left holding the entire bag? You guessed it, the naive 18 year old student borrower.

[Martha]

Quote:

Originally Posted by haha Also suggested in making bankruptcy possible for student loans.

Of course we can't make bankruptcy the route for all forms of student loans because all those insolvent college grads with student loans could just file bankruptcy and move on. Instead, what we do have is the ability to start a lawsuit in bankruptcy to prove that the loans cause you undue hardship. This is very tough to prove if you have future earning power plus you have to pay for the speculative litigation of the issue. Many bankruptcy courts follow a test which requires a showing that 1) the debtor cannot maintain, based on current income and expenses, a “minimal” standard of living for the debtor and the debtor’s dependents if forced to repay the student loans; 2) additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and 3) the debtor has made good faith efforts to repay the loans.

Sometimes there are possibilities to use chapter 13 bankruptcy to at least reduce loan payments for a period of time.

For federal student loans there is the income based repayment plan available: http://studentaid.ed.gov/PORTALSWebA...sh/IBRPlan.jsp


I disapprove of the private student loans like this woman took out. The lender gets all the bankruptcy law protections but the borrower is limited in restructuring options. I think private student loans should be treated like any other unsecured debt in bankruptcy.


(My brother went to a tech school for a couple of years and did not do well. He left after being diagnosed with autism and getting on SSI. His loans were supposedly forgiven for being disabled. Then about 15 years later the student loan collectors came after him full force. Even though he was disabled and on SSI they wouldn't accept proof. They said there was no evidence the loans were forgiven and we couldn't find any either after so many years. They harassed him and confused him causing much grief. I could have litigated the issue but instead I settled up with them by paying off the loans and getting the collection costs forgiven. Even that was a struggle. So I do have a bad taste in my mouth for the whole system. )

[ronocnikral]

i would like to point out that there are already limits in place on federal loans. i'm sure they've gone up, but freshman (by credit hour) can only borrow so much per semester (it is was something like $2300 when i was in school), sophomores can borrow a little more and juniors and seniors can borrow even more. not mention the plus loan system puts the parents on the line as well. and every loan needs someone to co-sign.

maybe a "pay off each degree before you dig yourself into a bigger hole policy." plus, a little dose of the real world never hurt anyone.

i'm surprised no one has brought up the salaries of the profs. i know it's always a touchy subject, but that's part of the inflated tuition costs.

i'm not saying i knew it all when i was 18, even when i was 22. i took out a private student loan my last semester to live a little more comfortably (so i could ski). i wished i wouldn't have. i didn't really understand how much it would truly cost me, but i didn't bicker and whine about it, i sucked it up and paid it off. it kept me up at night once i became a productive member of society.

no one forces anyone to go to college. it's a choice to sign on the dotted line, regardless of outside pressure and forces. removing the consequences (both good and bad) of one's choice benefits no one in the long term.

[harley]

I'm with Ha on this one (as I tend to be). At 18 I was an idiot. Even though I'd already been working for 6 years and had a good idea of the value of a dollar, I had no concept of credit, compounding, and especially debt. If I didn't have the cash, I couldn't buy it. Luckily back in my day tuition was cheap enough that I could earn it myself working my way through school. Not anymore.

I'm a huge fan of personal responsibility. But there's also a need for education before taking the responsibility. How hard would it be for a loan officer or college financial advisor to say "if you take on this much in debt, and you make this much in your future job (modified reasonably for the hoped for career), your payments will leave you this pittance to live on. Is it going to be worth it to you?" It would take 5 minutes and would likely avoid an awful lot of the problems we're seeing. They could even run a couple of examples at different take home pay levels to give ranges based on future incomes. Not that hard.

[Texas Proud]

Quote:

Originally Posted by haha I think you took a long way around the barn to reach the same conclusion that I and these other writers did- the responsibility needs to be put on someone who is in a position to understand what it means and who benefits from the lending. The school obviously does benefit (as does any firm whose product gets easy credit financing on someone else’s risk), as does the lender, as does the federal bureaucracy involved as does the student. No matter how perfect and cool and worldly wise and responsible all you tough love advocates think you were at age 18, I know I didn't know jack, and I know many young people don't either. So all parties get benefit, but one party is not truly able to understand the risk by virtue of being barely out of childhood. So which party gets left holding the entire bag? You guessed it, the naive 18 year old student borrower.

I am not quite there with you... I know that I did not want to run up a debt that I could not pay when I was 18... no amount of talking from some high priced school would have changed my mind (to be fair... none came a calling...)

I disagree that the schools are getting the benefits of this arrangement.. sure, more student can come with the easy credit... but most of the high priced ones are so oversubscribed they would fill their quota anyhow...

The banks can take a hit... but as mentioned.. who gets hit Using this girl as an example... should Citi suck up all of the bad debt since they loaned her the 'last' amount of money?

Also... should the lending institutions get involved with the degree choice? I mean, lending money for a degree in underwater basket weaving is not a good choice... but an engineer, finance or IT field might be the way to go...



Opps... just wanted to add.... what about the parents Sure... they want the best for their kids... but really... there is an adult in the equation .... so it is not only the 18 YO making a decision...

[harley]

Quote:

Originally Posted by Texas Proud I am not quite there with you... I know that I did not want to run up a debt that I could not pay when I was 18... no amount of talking from some high priced school would have changed my mind (to be fair... none came a calling...) I disagree that the schools are getting the benefits of this arrangement.. sure, more student can come with the easy credit... but most of the high priced ones are so oversubscribed they would fill their quota anyhow... The banks can take a hit... but as mentioned.. who gets hit Using this girl as an example... should Citi suck up all of the bad debt since they loaned her the 'last' amount of money? Also... should the lending institutions get involved with the degree choice? I mean, lending money for a degree in underwater basket weaving is not a good choice... but an engineer, finance or IT field might be the way to go...

I'm not saying that a person who chooses to take the loan should be able to easily walk away from it. Just that there should be more of an effort to make sure the student (and his/her parents) understand what they are getting into beforehand. Wouldn't have hurt in the housing market over the past 1o years either. Honest, ethical lending shouldn't be that rare.

[haha]

Quote:

Originally Posted by ronocnikral no one forces anyone to go to college. it's a choice to sign on the dotted line, regardless of outside pressure and forces. removing the consequences (both good and bad) of one's choice benefits no one in the long term.

Give me a break. Being forced at gunpoint is not the only way young people can be led. They have spent 12 years in a school system which really has no endpoints other than college, or failure. We are almost alone in the world at not tracking students. Should a mediocre student who has an IQ of 100 go to college.? Of course not. Are they led to believe that college is what any self respecting young person should aspire to? Of course they are. Should they be able to resist this subtle and not so subtle pressure? Maybe, but it is hard to choose to be a non-person.

Many universities exist only to capture fees from students. Almost any advisor in the academic system, at any level, will suggest more schooling as an answer. Why not? Are surgeons against operations, or lawyers against lawsuits, or furniture salesmen against couches? Not in my admittedly limited experience.

The parent is often relatively powerless against this array of supposedly better informed opinion. At any rate, many parents have their hands full just keeping their children from sniffing glue and having group sex at age 15.

Ha

[harley]

Quote:

Originally Posted by [COLOR=black At any rate, many parents have their hands full just keeping their children from sniffing glue and having group sex at age 15.[/COLOR] Ha

I think this deserves it's own thread.

[ronocnikral]

Quote:

Originally Posted by haha Give me a break. Being forced at gunpoint is not the only way young people can be led. They have spent 12 years in a school system which really has no endpoints other than college, or failure. We are almost alone in the world at not tracking students. Should a mediocre student who has an IQ of 100 go to college.? Of course not. Are they led to believe that college is what any self respecting young person should aspire to? Of course they are. Should they be able to resist this subtle and not so subtle pressure? Maybe, but it is hard to choose to be a non-person. Many universities exist only to capture fees from students. Almost any advisor in the academic system, at any level, will suggest more schooling as an answer. Why not? Are surgeons against operations, or lawyers against lawsuits, or furniture salesmen against couches? Not in my admittedly limited experience. The parent is often relatively powerless against this array of supposedly better informed opinion. At any rate, many parents have their hands full just keeping their children from sniffing glue and having group sex at age 15. Ha

while you may have read gunpoint, i alluded to no firearms.

regardless of how a student is led/taught by parents, teachers, mentors, religious figures etc, they are the ones ultimately responsible for their actions.

while some students may plead ignorance, they are given an amortization schedule with the loan or at minimum shown what your monthly payment will be at signing. you are also required to take exit counselling before graduation to enure you understand repayment terms. i hardly feel students are dooped. I seem to remember yearly statements as well, but that may have just been me keeping up with what i borrowed. i know we could all go online and see what we had borrowed at anytime. also, i feel the fin aid people at my school were very fair. In fact, i would get upset at them quite often b/c they would give me scholarships and i would go out and get another one outside the school - which in turn they would take away one of the previous awarded scholarships from me to give to another student. i was essentially earning a scholarship for another student.

regardless, the process is hardly unfair or predetory.

my dept head always said, if your starting salary => loan debt, it makes sense (or cents).