Money Mistakes: Student Loan Debt

Hey everyone, it’s time for another edition of Money Mistakes! Yes, even us self-proclaimed “money experts” have made a few missteps with our money here and there. This is where we share them to help any readers avoid the same fate as our own. Enjoy!

Tell Us a Little About Yourself

Hi, I’m Sam, the writer behind Smarter and Harder. My goal is to start exciting new conversations that challenge people to improve their work, lives, and money, and hopefully have a great time doing it. Both in my work and my personal life, I strive to lead with positivity, understanding, and more than a bit of enthusiasm.

I love cartoons, noodles, video games, and weightlifting. When I’m not writing, I’m probably enjoying at least one (though ideally multiple) of those things. I live with my wife and our awesome dog, Sophie, in our New England home.

What Was Your Money Mistake and When Did You Make It?

I certainly have plenty to choose from, but the one money mistake that has had the biggest impact on my life was going to an expensive private university with no real plan for how to pay for it.

I believe I was 17 when I decided to enroll, but 18 by the time I officially signed up to pay for it.

Up until that point, I had never made more than $3,000 in a year but decided it was a reasonable plan to sign up for a program that would cost me over $50,000 per year. I had no real savings to speak of and no wealthy benefactors, just a few scholarships, a couple of part-time jobs, and a whole bunch of loans.

What Led You To Making the Mistake?

The easy thing to do here would be to nebulously blame “society.” All of us growing up in the late 20th century were constantly reminded of the importance of a college education and, at the same time, conditioned to pay no attention to the stratospheric cost.

I won’t deny that the cultural influences played a role; of course, they did. But I also don’t want to deflect my personal responsibility. There were people in my life who advised against my choice. They told me the value of graduating without debt. Plus, I had seen what debt had done to my parents.

Even so, I set it all aside because I still believed that going to a “good” school was more important than going to a school I had any hope of paying for.

How Did You Recover From It?

Quickly, aggressively, and with a great deal of focus.

I proposed to my girlfriend right around the time we graduated college. We merged our finances and quickly realized we had a severe six-figure debt problem. So we got to work. We made getting out of debt our sole priority. We started learning everything we could about money, we set other goals on the back burner, and we did everything we could to slay our debt dragon.

In the end, we got all the way out of debt in about two and a half years. It took a massive concerted effort, but in the end, it was one of the best things that ever happened to us.

What Would You Have Done Differently?

It’s hard to say exactly what I would have done differently. On the one hand, I don’t regret my choice to attend the school I did. I met fascinating people there, got an excellent education, made unforgettable memories, kicked off my career, and had a wonderful experience. Everything that has happened in my life since — good, bad, and otherwise — stems back to that decision.

But at the same time, going into the decision the way I did, with no real plan and no thought to the long-term consequences, was a big money mistake. I won’t necessarily say I wish I made a different choice because I don’t. However, I do wish that I had approached the decision differently.

Given a chance to go back, I would take that decision more seriously and weigh in all the factors. I would take an honest look at the actual cost of being 23 years old and having nearly $170,000 in debt. I may or may not have ultimately made the same decision, but going into it with nothing but hope and a shrug was not the right move.

How Can Others Avoid the Same Money Mistake?

One thing I’ve realized since I started to get serious about my finances is that there are a lot of ideas circulating about what you’re “supposed to do” with your money. Go to this school, buy that car or house, and take this expensive trip because “you deserve it.” But, a lot of that oft-repeated cultural money advice is not very good.

Personal finance should always be personal first and financial second. The most positive shift in my financial wellness came when I started making decisions based on my understanding and what felt right to me. Not what the people around me were doing or telling me I should do.

That is the one thing I would recommend to everyone when it comes to debt or any other big money decision. Do a little research on your own, talk to people whom you trust, and decide for yourself what makes the most sense for your situation. Following along with what everyone else is doing, or what you’re “supposed to do,” is a quick way to get into trouble.

Most Importantly, What Did You Learn From Your Money Mistake?

Everything I now know about money all stems back to this one mistake. Getting into this deep hole with debt is what convinced me to start getting serious about money in the first place. That’s why I started reading awesome personal finance books, following blogs and podcasts and soaking up everything I could about building a better relationship with money.

If I were to boil it down to one thing, I’d say the importance of financial education. Most of us don’t receive the benefit of formal education about money. That means it falls to us to go out and seek our own financial learning. Whatever your interest or learning style, there’s something out there for you. Starting to learn some of the basics is the first step to totally transforming your life with money.

Anything Else You Want To Say?

Money can be scary. The financial problems that we all face at one point or another feel massive and overwhelming. Worse, they make us feel ashamed, guilty, and isolated from the people around us. As if somehow, we’re solely to blame for our challenges, and there’s no one else in a similar situation.

Just remember, whatever your personal money mistakes or challenges, you’re not alone. These are normal things that everyone goes through at different points in life. And every one of them is solvable. It may take time and hard work, and it may mean putting some other things on hold, but I assure you, you are bigger than whatever financial struggles you face.


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