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vaticanplum
03-08-2010, 07:48 PM
Redszoners: I need salient, objective advice. From financial gurus and/or people who have school debt.

Here is the deal, as concisely as I can put it (not very). I am hoping to go to graduate school next year. This is something I have been wanting to do for a while now and have kept putting off. I've been accepted into my dream program, I've been over the moon about it for weeks, and I was looking forward to giving them my affirmative decision in time for the deadline late this week. And then today I got the financial aid package.

The financial aid package is underwhelming, to say the least. And this is not really unexpected; there's not a lot of money in my field, and not a lot of money in the world of education or in general right now. It actually lines up very well with the sample package the school provided earlier in its 65-page financial aid manual, so I don't know why I'm so shellshocked by it. I guess it's just different when the numbers are staring you in the face.

The numbers are terrible. The full cost (tuition, room and board, and health insurance) for the two-year education is over $110,000, with the first year being more costly due to three semesters vs. two and mandatory travel. They have awarded me a small teaching fellowship and an itty bitty scholarship. They have estimated my own contribution at $16K for the first year (more about that in a bit). This brings my expected loans to $49,474. FOR THE FIRST YEAR.

Now. I'm capable of living very frugally and I can see being able to save some money in those loans, i.e., I think their estimates for living expenses are probably on the high side. But even so, I can chop off maybe a few thousand dollars at most. The program is very rigorous and involves its own brand of work on top of classes, 12-16 hour days six days a week, so having a separate job during school is discouraged and probably in fact out of the question.

I'm just...not sure what to do right now. I'm not really asking for advice on whether I should do this program. That's a decision only I can make, I know, and in my heart of hearts I can't believe I could turn it down. I've worked a long time and made a lot of sacrifices to be able to go to this kind of a program and I love it so much. There aren't a lot of programs in my field to begin with, and this is the best there is. When they first accepted me, one of the things I was most happy about was the fact that with this degree I will be guaranteed a job forever, which is huge and unusual in my field. But the thing is, I'm guaranteed work that may pay me $35K a year after I graduate. Nevertheless, it would be very hard for me to turn this down. This is what I have been working for most of my life.

So what I'm asking for advice with, I guess, are the sheer financials of it. How do people DO it? How do people incur $90K of school debt without the promise of a commensurate salary to pay it back afterward and still sleep at night? I have always been very cautious with money. I have less than $13K in college debt, which is very good considering how expensive my college was, and have never had any other debt. I save a full third of what I make, in various forms (401K, investments, and straight-up savings), but even so, I don't have anywhere near $16K to throw at school next year (my own estimated contribution -- don't have it. just don't have it, can't get it), and even if I did I wouldn't want to. That money is my emergency money, my what-if-someone-dies-when-I'm-living-overseas, what-if-my-mom-loses-her-job-again money. So that $16K (which they based on my FAFSA, which is somehow based on my 2009 earnings from my very nice job which I will not have in a few months if I go to school) will just have to be ANOTHER loan. I know that I could be in much worse shape right now than I am, but at the same time, right now I kind of feel like all my attention paid to careful financing over the years has been for naught. And can go to pot SO QUICKLY in two years' time.

I even considered deferring for a year once I saw this offer, until I realized that a) the school doesn't permit deferrals, and b) I considered what I could actually save to put toward school in a year, and I could do maybe $15K, which I think is pretty impressive but, let's face it, is really a drop in the bucket of $90K in school loans. I'm also 31 years old, which is a double-edged sword of being old enough to be very conscious of money and worried about debt while knowing that I cannot legitimately put off this kind of intensive program any longer.

How have others handled similar situations? Do you just take a deep breath and deal with the debt later? Do you just accept that this is the way it is? Are there other alternative? I need help. A week ago this was the greatest thing that has ever happened to me and my life was wide open, and now I'm a mess and I feel like everything has slammed shut and that no matter how many career opportunities this creates for me, I'll always have to consider money first. I hate the thought of that. :(

OSUmed2010
03-08-2010, 08:09 PM
I have about 160k in student loans. (Although, I'm in a different situation, as I will hopefully earn a comensurate salary about 6 years after I graduate.) I guess my only advice would be to really look at this program and what makes it the best for you.

What specific qualities make this program ideal?
Are there any programs where you could get a similar education/experience?
Is the difference in education worth the difference in tuition?

I faced a similar dilemma when I had to choose which school I'd go to. The difference in price between a state and private school was about 60k over 4 years. Even between two state schools, there could be a large gap in cost depending on the scholarships they had available.

I chose the "cheapest" route, and I'm happy that I did. For me, the difference in education did not justify the difference in cost. I don't know what you field you plan on studying, so I can't speak for that. But from where I stood, most of the schools seemed to offer generally the same stuff; the only major difference was the prestige.

SunDeck
03-08-2010, 08:16 PM
My first question would be, how much will you be likely to earn after graduation?
Paying $250K for med school is probably better than paying $75K to get an MFA.

Reds4Life
03-08-2010, 08:22 PM
Personally, the only way I would invest in a graduate degree right now is if the career field you are in is in demand, and high paying.

It varies from field to field, but with the economy the way it is right now even people with advanced degrees aren't making much. I see people with MBA's who used to make over $100k a year and now they only get offers for jobs paying $50k if they are lucky. Doctors and laywers are the exception, but they always were.

Will M
03-08-2010, 08:22 PM
Redszoners: I need salient, objective advice. From financial gurus and/or people who have school debt.

Here is the deal, as concisely as I can put it (not very). I am hoping to go to graduate school next year. This is something I have been wanting to do for a while now and have kept putting off. I've been accepted into my dream program, I've been over the moon about it for weeks, and I was looking forward to giving them my affirmative decision in time for the deadline late this week. And then today I got the financial aid package.

The financial aid package is underwhelming, to say the least. And this is not really unexpected; there's not a lot of money in my field, and not a lot of money in the world of education or in general right now. It actually lines up very well with the sample package the school provided earlier in its 65-page financial aid manual, so I don't know why I'm so shellshocked by it. I guess it's just different when the numbers are staring you in the face.

The numbers are terrible. The full cost (tuition, room and board, and health insurance) for the two-year education is over $110,000, with the first year being more costly due to three semesters vs. two and mandatory travel. They have awarded me a small teaching fellowship and an itty bitty scholarship. They have estimated my own contribution at $16K for the first year (more about that in a bit). This brings my expected loans to $49,474. FOR THE FIRST YEAR.

Now. I'm capable of living very frugally and I can see being able to save some money in those loans, i.e., I think their estimates for living expenses are probably on the high side. But even so, I can chop off maybe a few thousand dollars at most. The program is very rigorous and involves its own brand of work on top of classes, 12-16 hour days six days a week, so having a separate job during school is discouraged and probably in fact out of the question.

I'm just...not sure what to do right now. I'm not really asking for advice on whether I should do this program. That's a decision only I can make, I know, and in my heart of hearts I can't believe I could turn it down. I've worked a long time and made a lot of sacrifices to be able to go to this kind of a program and I love it so much. There aren't a lot of programs in my field to begin with, and this is the best there is. When they first accepted me, one of the things I was most happy about was the fact that with this degree I will be guaranteed a job forever, which is huge and unusual in my field. But the thing is, I'm guaranteed work that may pay me $35K a year after I graduate. Nevertheless, it would be very hard for me to turn this down. This is what I have been working for most of my life.

So what I'm asking for advice with, I guess, are the sheer financials of it. How do people DO it? How do people incur $90K of school debt without the promise of a commensurate salary to pay it back afterward and still sleep at night? I have always been very cautious with money. I have less than $13K in college debt, which is very good considering how expensive my college was, and have never had any other debt. I save a full third of what I make, in various forms (401K, investments, and straight-up savings), but even so, I don't have anywhere near $16K to throw at school next year (my own estimated contribution -- don't have it. just don't have it, can't get it), and even if I did I wouldn't want to. That money is my emergency money, my what-if-someone-dies-when-I'm-living-overseas, what-if-my-mom-loses-her-job-again money. So that $16K (which they based on my FAFSA, which is somehow based on my 2009 earnings from my very nice job which I will not have in a few months if I go to school) will just have to be ANOTHER loan. I know that I could be in much worse shape right now than I am, but at the same time, right now I kind of feel like all my attention paid to careful financing over the years has been for naught. And can go to pot SO QUICKLY in two years' time.

I even considered deferring for a year once I saw this offer, until I realized that a) the school doesn't permit deferrals, and b) I considered what I could actually save to put toward school in a year, and I could do maybe $15K, which I think is pretty impressive but, let's face it, is really a drop in the bucket of $90K in school loans. I'm also 31 years old, which is a double-edged sword of being old enough to be very conscious of money and worried about debt while knowing that I cannot legitimately put off this kind of intensive program any longer.

How have others handled similar situations? Do you just take a deep breath and deal with the debt later? Do you just accept that this is the way it is? Are there other alternative? I need help. A week ago this was the greatest thing that has ever happened to me and my life was wide open, and now I'm a mess and I feel like everything has slammed shut and that no matter how many career opportunities this creates for me, I'll always have to consider money first. I hate the thought of that. :(

we live in the real world. you have to look realistically at how much money you will make (especially after taxes & basic bills are paid) after you get your new degree. IF if isn't going to come close to being able to pay off your debt in a reasonable fashion then you may want to make the very pragmatic decision to give up your dream.

i am 45 years old. when i was young i decided to become a physician. i got my undergrad degree in Biology. i had zero debt. then i went to medical school. i finished in 1990 with $30K in debt. i was able to pay off all my loans within 3 years of finishing medical school. at age 32 i started saving and investing money.

fast forward to today. one of my partners just finished her residency and is over $200,000 in debt at age 32. not only that but physician incomes are a lot less that they were in the past and the future doesn't look promising. if i had been in her shoes i would never have gone to medical school even though it was my first choice of what i wanted to do. i would have become a chemical engineer. i would have made less money but i would have been able to start working/saving/investing with no debt at age 22.

it might seem that you want your 'dream job' but all jobs have one thing in common: they are a job. not a hobby. not something you do for fun. eventually even your dream job won't be lollipops & unicorns. you will have to do things you don't want to do, things some bureaucracy makes you do & unpleasant colleagues and coworkers to deal with. if you are 45 & have a nest egg growing this is a lot more tolerable than if you are 45 and still in debt from school.

just two cents from a pragmatist,

- Will

Red Heeler
03-08-2010, 08:44 PM
I was 30 when I got accepted to vet school. I ended up with about $80K in student debt when I got done. I'm not sure about the rules now, but I was able to consolidate my loans when I got done for a 30 year payback. Interest at that time was somewhere around 3.5%. I get a decrease in interest for paying by direct withdrawal and got another decrease for making 3 years worth of payments on time. I don't know what your earning potential is once you finish the program, but my loans have not been a big strain on my wife and I.

MWM
03-08-2010, 09:04 PM
Say yes, and go to grad school. If you don't, you'll spend the next 40 years wishing you had. It's a life experience, not just a degree. If you can live frugally and manage to pay it off over a long period of time, it will be worth it. If you love what you do, you won't care about having to live a much more meager lifestyle for the years after the program that it will affect you. Now, all of this is assuming you really love the field and what this program has to offer.

I faced the same decision about 6 years ago and I have well over $100k in debt. It's a heavy burden and definitely puts a cramp on things for at least a few more years. And I also have to admit that my program allowed me to do fairly well after graduation so it won't be quite as burdensome as yours. But I had a family with 3 kids and I had a good paying job at the time. For me it came down to it being a life experience I wanted and I knew I'd always regret it if I didn't do it.

If you're lukewarm on going irrespective of the cost - and it sounds like you are not - then you'd make a different decision. But if you're passionate about this and you really would LOVE to do it, my advice would be to do it, and take care of the financial burden afterwards. Some might think this is terrible advice, but I'm a big believer in the value of great life experiences.

Sea Ray
03-08-2010, 09:22 PM
Can you go to a cheaper school? Is that an option?

I get the idea you'll be a teacher of some sort when this is all said and done. If so, are you willing to work summers to pay off your loan? If it means that much to you so that the answer is yes then I'd say go for it.

Cyclone792
03-08-2010, 09:27 PM
VP, these are just some of the things I've observed so take it for what it's worth. It may not be worth anything so this is my disclaimer on it. ;)

When I was in undergrad, I worked in a mortgage office of a bank. Not only did I work in that kind of setting, I primarily did audit checks on loans. We re-checked credit scores, job status updates, tax bill payments. etc. That meant I pretty much had full access to the financial records of anybody who had a loan with our bank. I knew what their assets were, how much their assets were worth, where they worked, how much they earned, and how much they saved/had saved.

Many people - let me emphasize this ... many people - make financial decisions at some point in their lives (or repeatedly in their lives) which results in them hanging on by the skin of their teeth. They make good money, and they also spend good money. They make good money, and they're unable to save much money because they're too busy paying off debt. And sometimes it's not merely debt, but also repeatedly paying the interest they're incurring due to their debt.

These are the people who are one emergency away from spiraling out of control down a path that nobody wants to go down. Maybe it's a job loss, maybe it's an unexpected expense, maybe it's an unexpected increase in one or more common expenses, whatever. They made good money and lived paycheck to paycheck, and as soon as one thing went wrong, their world collapsed financially.

Unfortunately we've seen in the last two years what types of havoc a recession can wreak on individuals, and the vast majority of people who are in trouble are the ones were hanging on by their skin previously.

People who save money and have no debt (or little debt) can weather the storm of an emergency. If they lose their job, they can live off unemployment for the foreseeable future until finding something without risking losing their house or having the repo man visit them overnight to take their car back.

I know all this because I saw it every day while working in this bank. It's the sad truth, but it's reality out there (I'll note that I worked there long before this recession hit too). It's the unfortunate and too common answer for your question on how most people do it. They barely did it, and in the end a fair amount haven't been able to make it.

For me personally, I'm a lot like Will outlined. A career, even a wonderful career, is still just a job to me. It's not a dream. My dream is to retire as early as possible so I can do what I want, which partly involves traveling around watching a lot of baseball, playing a lot of golf and chilling on a beach. No job will ever be part of that dream unless somebody is willing to pay me a salary to let me do whatever it is I want, and that job hasn't ever been available. I have a four year degree and have been able to launch a nice career at a nice organization, and I also have no school debt. Of course, this is a situation I strived for and worked hard to put myself in. It's all part of being able to achieve my dream.

Everyone is wired differently and you obviously have your set of dreams, one of which appears to have some financial risk. Only you know what you really want to do and if you should really do it. I'd just strongly urge you to know the full risk and go in knowing and understanding that full risk.

Perhaps it's worth it, perhaps it isn't. Only you can fully know and understand that.

As an aside, I did read an interesting article about a week ago that really took a hard look at different types of college education, and it put together a fairly legitimate argument that some types of college education just isn't worth it anymore due to the rising cost of tuition vs. the long-term salary difference outlook. I'll see if I can dig it up again.

Cyclone792
03-08-2010, 09:36 PM
I'm still looking for the article I referenced, and I'm not sure if I'm going to be able to find it.

Nevertheless, this is a good read if you're trying to get a handle on college debt vs. future earnings potential: http://moneywatch.bnet.com/retirement-planning/blog/retirement-roadmap/borrowing-for-college-heres-the-formula/2840/

MWM
03-08-2010, 09:58 PM
VP, if this program costs that much and the jobs coming out of the program don't pay all that much, you can't be the first person to have this dilemma. I'd think pretty much everyone coming out of the program would have the exact same issue. What do they do? Seems like you should be able to get a lot of guidance from the program.

vaticanplum
03-08-2010, 10:28 PM
VP, if this program costs that much and the jobs coming out of the program don't pay all that much, you can't be the first person to have this dilemma. I'd think pretty much everyone coming out of the program would have the exact same issue. What do they do? Seems like you should be able to get a lot of guidance from the program.

Yeah...this is a good point. And I am talking to the financial aid office tomorrow. It is possible that I'm undercutting my future earning potential. One of the reasons I'm getting this degree is to be able to teach at the college level, and I tend toward the conservative in estimating things, but even as an adjunct I might be able to earn more than $35K a year with other gigs.

I appreciate all the advice. As to some of the questions -- there aren't really cheaper education options in this field, or if there are, there's really no job potential beyond them, which is depressing. I do have an option out there for a cheaper degree, but it's not even the degree I want...I'd have to go for a PhD afterward and that might ultimately take even more money and certainly time. MWM kind of nailed it on the degree itself. This really is a once-in-a-lifetime opportunity and I couldn't really do anything else knowing I'd given this up. For me a career, this career, isn't just a job; I just happened to be blessed (cursed?) with an inherently financially conservative personality. Cyclone -- I will always have a decent emergeny fund, for one. I couldn't sleep at night without one. It's not wanting to put that toward non-emergency school that is partly what's gotten me so worked up here.

I guess part of what I'm looking for is really viable financial solutions. Where do people look for extra grad school money? What is the best way to deal with school loans, both during and after school? Subsidized Stafford loans appear to account for the smallest part of my offer -- do I have any control over what's subsidized and what's not? Direct solutions like Red Heeler mentioned, this is kind of what I'm looking for.

Yachtzee
03-08-2010, 10:51 PM
Yeah...this is a good point. And I am talking to the financial aid office tomorrow. It is possible that I'm undercutting my future earning potential. One of the reasons I'm getting this degree is to be able to teach at the college level, and I tend toward the conservative in estimating things, but even as an adjunct I might be able to earn more than $35K a year with other gigs.

I appreciate all the advice. As to some of the questions -- there aren't really cheaper education options in this field, or if there are, there's really no job potential beyond them, which is depressing. I do have an option out there for a cheaper degree, but it's not even the degree I want...I'd have to go for a PhD afterward and that might ultimately take even more money and certainly time. MWM kind of nailed it on the degree itself. This really is a once-in-a-lifetime opportunity and I couldn't really do anything else knowing I'd given this up. For me a career, this career, isn't just a job; I just happened to be blessed (cursed?) with an inherently financially conservative personality. Cyclone -- I will always have a decent emergeny fund, for one. I couldn't sleep at night without one. It's not wanting to put that toward non-emergency school that is partly what's gotten me so worked up here.

I guess part of what I'm looking for is really viable financial solutions. Where do people look for extra grad school money? What is the best way to deal with school loans, both during and after school? Subsidized Stafford loans appear to account for the smallest part of my offer -- do I have any control over what's subsidized and what's not? Direct solutions like Red Heeler mentioned, this is kind of what I'm looking for.

It sounds to me like you've already got good characteristics to avoid some of the pitfalls that some fall into while attending grad school. The big thing is to get into the habit of living frugally, as it will help keep down debt in the short term and make it easier to pay it back once you graduate. A lot of grad students fall into the trap of taking out the maximum in loans and spending the extra money on a nicer apartment and nice things to fill it with, or go out partying every weekend.

If you can get by just taking out loans for what you need and living on the cheap, you'll be the much better for it. And remember that it's important to consider long-term earning potential as well, not just starting salary, when it comes to the ability to pay the loan back. If you're just naturally frugal and able to live within your means, you will be able to pay above the monthly payment on your loans in order to pay them off early. Don't forget job stability as well. Many run into problems not because they spent too much, but they haven't been able to find stable work. It sounds like this program is one that would provide you would a long-term career doing something you love. If you can do that, I say go for it.

I had a good-paying job doing something I wasn't really enjoying and then decided to take on the debt and go to law school. My school debt is substantial, but I'm now doing something I truly love. I have new challenges every day. When I couldn't find a job with someone else, I was able to just strike out on my own. I don't regret going to school and taking on the debt. My only regret is not having done it sooner.

pahster
03-08-2010, 10:54 PM
On adjuncting: I think you should think long and hard about going into this much debt if the best job you can get out of this is an adjunct position. Do you really want to teach six to eight classes a semester at several different schools with little to no job security?

On getting a PhD: Yes it will cost time, but it shouldn't cost money besides the income you will miss out on by being in school. Don't bother going anywhere that doesn't pay for your tuition/fees and doesn't provide you with a livable stipend; it's not worth it and those kinds of places don't value their students as anything other than TA fodder.

Eric_the_Red
03-09-2010, 06:46 AM
http://www.daveramsey.com/article/student-loan-backlash/lifeandmoney_college/

Hoosier Red
03-09-2010, 07:34 AM
Ramsey makes a good point but no one's going to get a 12% geometric average return on their investments over a 10 year period.

VP, I'm generally in favor of going after your dreams to almost any end. Please forgive me for prying, but I don't believe you have family counting on you(spouse, kids) correct?

If that's the case, than you can be a little greedy and spend the money(debt) on yourself.

15fan
03-09-2010, 08:58 AM
On adjuncting: I think you should think long and hard about going into this much debt if the best job you can get out of this is an adjunct position. Do you really want to teach six to eight classes a semester at several different schools with little to no job security?

On getting a PhD: Yes it will cost time, but it shouldn't cost money besides the income you will miss out on by being in school. Don't bother going anywhere that doesn't pay for your tuition/fees and doesn't provide you with a livable stipend; it's not worth it and those kinds of places don't value their students as anything other than TA fodder.

The truth has been spoken above.

The kind of debt you are looking at & the corresponding earning potential after the program are going to dictate decisions for the rest of your life. Marriage. Family. Travel. Retirement. Home Buying. The list goes on and on.

I would advise you to go back to the financial aid folks and let them know how much you are interested in the program, but how daunting the financial burden is. It's quite possible that as time progresses and they have a better feel for who will/won't matriculate, other financial aid options will become available. If there are other resources, you want to be on their radar.

I would also recommend that whatever you do, do not do not do not pull money out of your retirement instruments to pay for this. Between the taxes & penalties of early withdrawls, you will be paying a hefty premium.

bucksfan2
03-09-2010, 09:22 AM
I am 27 and don't have any college debt so take may answer for what it is worth.

I have long been told that education debt is considered good debt, as long as you are current and paying. I don't know if that is still considered true or not. I do know that with so many people going to college, and especially going back to get their MBA, fields are becoming saturated with educated people. I think if you can go and get a specialization masters it greatly enhances your hiring/working power.

I think the 100K figure can seem overwhelming, but I do think you have to consider it over the course of the loan. If I understand college debt, it doesn't kick in until after you have graduated, or have quit school. While it may look expensive, the earning power down the road may be much greater. To me its kind of like that high school/college decision. Do I go to college and stay poor for the next 4 years or do I go into the work force and make $10/hour. While that $10/hour may look great to start it doesn't look that good 5-10 years down the road.

gonelong
03-09-2010, 10:24 AM
Stafford Loans for Graduate School (subsidized and unsubsidized) are at 6.8% currently.
Plus loans are at 8.5%

Principle and Interest Payment on a $90K, 30 year loan at 6.8% is $624/month.
Principle and Interest Payment on a $90K, 30 year loan at 8.5% is $724/month.

Loan consolidation is not a slam dunk like it was 3-5 years ago.

At 35K a year, you will take home maybe about $2000 a month. A full 1/4-1/3 of that will go to service your student loans. Can you live on $1200-1400 a month for the next 5 years ... or maybe the next 30 years (until you are 31+2+30=63)?

You have to decide if the juice is worth the squeeze, and only you can decide that.

For many people (such as my brother), this wouldn't be a deterrent in the least. He would jump in with both feet and not think a thing about it. He would fully expect that things would work out for him. I'd lose some sleep over the deal, and vomit every month I wrote the check.

From what you wrote above, I wonder if the stress from worrying about the financial burden will be worth the realization of the dream. Don't discount any possible mental costs when making your decision.

I think I would ask myself the following:
1. If I enroll in the program, what is my 5-10-15 year outlook (location, family, career, finances, etc.)?
2. If I don't enroll in the program, what is my 5-10 year outlook (location, etc) ?
3. Which of these do I prefer?

Good Luck, a tough decision to be sure.

GL

vaticanplum
03-09-2010, 10:26 AM
Ok, first of all, those articles are terrifying the crap out of me. As if I weren't scared enough at my own potential debt, now I have to feel GUILTY about what my student loans do to the economy. Good grief.

Secondly, on adjuncting. I mentioned that as something of a worst-case scenario, teaching wise. I should clarify that this is a terminal degree. It will qualify me for any kind of teaching position at the university level. Ideally I think I'd like a full-time tenure track position down the road, but I don't want to count on that straight out of school because a) those are very hard to come by right now with education funding being cut right and left, and b) it behooves me, both personally and professionally, NOT to go into full-time teaching right away. Professional (non-teaching) experience will be very valuable and make me more attractive to universities later on.

One of the things I'm going to ask the financial aid people (person. as far as I can tell there is one person) is really how well graduates from this program do, with as solid financials as she can give me. I've been told, very sincerely I believe, by the heads of the program that graduates do very well, but relative to my field, I always just assumed that meant they could get permanent work. Numbers would be nice.

And no, I don't have a family ie. kids of my own, though I do feel a keen responsibility, financially and otherwise, to those who helped pay for my education up to this point. But of course that's a good point and something I've considered. I will not have this chance forever. I do honestly worry that I'm cheating any future children of mine their own education options. But I guess I can't worry about hypotheticals forever.

I didn't sleep at all last night and ultimately decided that this is just the way it's going to be. I won't be sleeping well for many years to come. But I can lose sleep over money for the next 30 years, or I can lose sleep over my biggest missed opportunity for the rest of my life. I'm going to choose the former, obviously, because I think I'll be doing a disservice to myself and those who worked to give me this opportunity if I don't. I'll just have to work really hard to be the most appealing job candidate ever and figure out ways to avoid and pay off debt any way I can. Suggestions are always welcome...

And no touching retirement, I wouldn't think of it! Totally off limits.

vaticanplum
03-09-2010, 10:30 AM
Stafford Loans for Graduate School (subsidized and unsubsidized) are at 6.8% currently.
Plus loans are at 8.5%

Principle and Interest Payment on a $90K, 30 year loan at 6.8% is $624/month.
Principle and Interest Payment on a $90K, 30 year loan at 8.5% is $724/month.

Loan consolidation is not a slam dunk like it was 3-5 years ago.
The financial prospectus I was sent quotes all Stafford loans at 6.8% interest but Plus loans fixed at 7.9%. Not that it's that big a difference, but is the latter incorrect?

The Plus loans are where I would make up any money by living more frugally than what they've estimated in terms of living expenses. I spent a full 18 months of my life eating on a $1.31-a-day food budget, so I am hoping I can do this a little.

RiverRat13
03-09-2010, 10:47 AM
Ramsey makes a good point but no one's going to get a 12% geometric average return on their investments over a 10 year period.


No kidding. After reading that article I was going to ask if Ramsey lets people know in another article where we can find mutual fund that had 12% growth over the last decade.

gonelong
03-09-2010, 10:48 AM
The financial prospectus I was sent quotes all Stafford loans at 6.8% interest but Plus loans fixed at 7.9%. Not that it's that big a difference, but is the latter incorrect?

The Plus loans are where I would make up any money by living more frugally than what they've estimated in terms of living expenses. I spent a full 18 months of my life eating on a $1.31-a-day food budget, so I am hoping I can do this a little.

I pulled that info from Sallie Mae: http://www.salliemae.com/get_student_loan/find_student_loan/grad/grad_student_loans/grad_plus/grad_plus.htm

Your circumstance might be different.

I would be sure to know everything about the financial aspect of this decision. Some of these loans come with an origination fee (up to 3%). I believe some of the loans only have a 10 year payoff (you'd have to get someone to consolidate to 30 years, no slam dunk in 2010).

90K, 7.9% interest on a 10 year loan is $1087/month payment.

Please be careful and ask many questions, then double check/verify the information yourself. You are making an enormous financial decision here, IMO you should make it a part-time job to figure out what it means to you over the life of the commitment.

GL

vaticanplum
03-09-2010, 10:55 AM
I pulled that info from Sallie Mae: http://www.salliemae.com/get_student_loan/find_student_loan/grad/grad_student_loans/grad_plus/grad_plus.htm

Your circumstance might be different.

I would be sure to know everything about the financial aspect of this decision. Some of these loans come with an origination fee (up to 3%). I believe some of the loans only have a 10 year payoff (you'd have to get someone to consolidate to 30 years, no slam dunk in 2010).

90K, 7.9% interest on a 10 year loan is $1087/month payment.

Please be careful and ask many questions, then double check/verify the information yourself. You are making an enormous financial decision here, IMO you should make it a part-time job to figure out what it means to you over the life of the commitment.

GL

That's great information, thanks GL.

Roy Tucker
03-09-2010, 11:00 AM
Not to put any more fear into your heart than already is there, but all this also requires that you indeed do get the degree.

Having said that, I'm sure you will.

But what happened to my son was 2 years worth of student loans and then he flunked out. Great Lakes only cares if you are currently full time. If not, a 6 month timer clicks on. If you aren't full time at the expiration of that timer, you start making payments. So now he's trying to pay off the $10K worth of loans as a grill cook at O'Charley's.

Reds4Life
03-09-2010, 11:22 AM
Do you intend to teach at a public University, or a private one?

Not to be a negative nancy, but most states are slashing higher education budgets pretty heavily right now because of huge shortfalls in the budget. A lot of state schools all around the country are going to be laying off professors, not hiring new ones.

pahster
03-09-2010, 11:34 AM
Do you intend to teach at a public University, or a private one?

Not to be a negative nancy, but most states are slashing higher education budgets pretty heavily right now because of huge shortfalls in the budget. A lot of state schools all around the country are going to be laying off professors, not hiring new ones.

Privates are having problems too because a lot of endowments took substantial hits. Tenure track lines are drying up, though I don't think there's any need to worry about people getting layed off; that's not how tenure track jobs work. Hiring freezes are a legitimate concern, though.

That said, it'll get better eventually. Maybe not by the time VP is done with her two year program, though.

bigredbunter
03-09-2010, 12:59 PM
I would advise you to go back to the financial aid folks and let them know how much you are interested in the program, but how daunting the financial burden is. It's quite possible that as time progresses and they have a better feel for who will/won't matriculate, other financial aid options will become available. If there are other resources, you want to be on their radar.

.

VP--

Agree with the above. I've made a similar journey as you are considering. Here's what I wished I had knew when I started--

1. It's not all about you wanting the program. They should want you too. If they don't, you're going to be disillusioned fast. I would go directly to the academic program (not necessarily the financial aid people). The chair can put pressure on the financial aid dept. and find money.

2. I get where you are coming from as far as "dream job" goes. I'm holding down a faculty position now (incurred about $25K in student loans over the MA and PhD level), and don't regret ever spending the money. Having said that, if you're taking out 100K, you'll spend $225K paying that back with interest. Unless I were tracking to make serious (serious) money, I could could not do that as a thinking person.

3. The financial situation often improves in ways that you can't forsee during a graduate program. You start to work on other people's projects, Professor X has $500,000 to do this or that, etc....These things happen, but you have to be good. Really good. As long as you quickly establish a reputation for someone who is a top student, the finances probably will fall into place. If you're going to be a mediocre student in a top program that is expensive, just go to a regional school where you'll have more opportunities and it won't cost as much.

Just my experience. Hope it helps.

Rojo
03-09-2010, 01:31 PM
Frankly I would touch the retirement. My grandfather stated that if you're even at forty, your doing ok.

TeamSelig
03-09-2010, 03:45 PM
Wow and I thought my 16k debt was a big deal.

15fan
03-09-2010, 03:58 PM
Frankly I would touch the retirement. My grandfather stated that if you're even at forty, your doing ok.

Uncle Sam says that if you touch the retirement money, you'll be paying taxes & penalties of about 40%.

You'd get better rates borrowing from Vinnie who's lending money out of the back of his van in a dimly lit alley somewhere.

TRF
03-09-2010, 04:07 PM
Am I the only one thinking there are some scholarship possibilities? I know that generally they apply to undergraduate and graduate degrees, but it is worth looking into. Also, to parrot an earlier post, Is this the ONLY school you are considering?

Yachtzee
03-09-2010, 04:21 PM
I think it's important to look at job prospects and salary growth potential in considering ability to repay the debt. This may be entirely dependent upon the field of study. For example, right now it would be pretty rough to justify that amount of debt if you were considering going for an MBA, as the market is flooded with MBAs. Whenever I talk to someone interested in getting an MBA, I feel they need to get out there working for a few years and see if their employer will help them pay to enter an executive MBA program.

Law degrees? I have one, so I can't necessarily tell people don't do it. However, I emphasize strongly that anyone considering it thing long and hard about whether they are doing it for the right reasons. If you do it because you have a passion for the law, that's one thing. If you're doing it because you thing it's going to result in lots of money and job security, think again.

However, as VP described it, this advanced degree might be a rather restrictive field. It may not have the potential of a 6-figure salary that a law degree or an MBA carries for the select few that finish at the top of their class or go to one of the top schools. But it might not be oversaturated with candidates like those other two areas are. If that's the case, she might have strong prospects for a job out of school and long-term stability in her career field. Again, it's important to look at things beyond what someone will make right out of school, and take into account long-term earnings and job stability when comparing it to long-term debt.

vaticanplum
03-09-2010, 04:27 PM
Am I the only one thinking there are some scholarship possibilities? I know that generally they apply to undergraduate and graduate degrees, but it is worth looking into. Also, to parrot an earlier post, Is this the ONLY school you are considering?

Part of my package is a $1500 scholarship. Yay?

I applied to a few backup schools, yes, but questioned even before I was accepted anywhere whether that was a good decision. It's cheaper but it's not a great career move. It's not a terminal degree and so would not permit me to teach at the college level, which is one of my goals. To do that I'd have to continue onto a PhD, which for many reasons is not something I really want to do.

There is one other comparable program on the table. But I consider it a distant option because a) they haven't accepted me yet (I interviewed last week and the decision is due any time now), b) it's not nearly as good a fit for me, and c) if I felt there was going to be a much better financial deal it would be much more in the forefront of my mind, but that's extremely unlikely. That school is notoriously stingy with funding and it's also a three-year program instead of two.

Without going into too many details because I think it would be confusing, the program is unusual. There are only a few in existence at all, and none are at public universities (there was one and I did apply there, but I'm getting the impression it's getting cut because of funding). So my options in that regard are limited. There's only so much pull I can have because no matter how much they "want" me, competition is stiff and each program only takes 3-4 students a year. You'd think they'd have more money to dole out, right? I really think that in anything non-profit related, people are so used to being in debt and having low-paying jobs that they just accept that it's the way it is. I am obviously having a hard time with that.

Re: dipping into retirement, to be honest, I don't even have enough yet to make it worth it, penalties or not.

Some encouraging things in this thread. A lot of things that make me want to curl up into a hole too.

I have a message in at the financial aid office and a page and a half of questions and talking points. Waiting for a call back now.

Yachtzee
03-09-2010, 04:30 PM
Just to add an example to my point above, one area where continuing education makes sense is Nursing. In my area, just about the only part of the economy that is growing is the medical field. If someone is interested in that area, seeking to become a Licensed Nurse Practitioner is a great way to go. You may not have the same upper level salary potential as a full doctor, but you can come out of school with really good job prospects and an earning potential that puts you near what some doctors might make, but without the same debt load as going to medical school. It also has the long-term job stability aspect that makes paying off long-term debt like student loans much more palatable.

oneupper
03-09-2010, 08:02 PM
I'm supposedly a financial guy, but I'm going to agree with MWM on this. Go for your dream.

There are financial "decisions" and there are "life" decisions. They sometimes intermingle and one may get in the way of the other, but usually one knows which category a decision falls into.

If all decisions were all dollars and cents, most of us wouldn't have chosen to have kids or even get married. We wouldn't jump out of airplanes or paddle down rapids. Life would be very, very boring.

So make this investment in yourself. Your experience. Your life. Your career (although not necessarily).
The money? If I understand correctly, your main concern is paying back debt AFTER graduation. Worry about that then. I'm not saying you should be carefree (http://online.wsj.com/article/SB10001424052748703389004575033063806327030.html?m od=WSJ_hpp_sections_personalfinance) (http://online.wsj.com/article/SB10001424052748703389004575033063806327030.html?m od=WSJ_hpp_sections_personalfinance)

But think: What is the worst that can happen?

Suze Orman gets a lot of flak from the formal financial community. But she always says "People First, Then Money and Things afterwards". I believe in that.

Good luck. :)

cincinnati chili
03-10-2010, 12:36 AM
This current economic downturn has made me rethink a lot of things. I may have made the wrong decision to go to law school. But it will probably take another 10 years for me to get some perspective. I'm supposedly one of the lucky ones in that I have a job, did well in law school, made law review, blah, blah. But I have more than twice as much debt as my annual income, and I certainly wouldn't say I love what I do. I spend a lot more time being unhappy now than I ever did before law school.

So if you're going to be buried in debt for a good portion of your life, it's extra important to make sure that you're going to love what you do. It's sound like this is your thing, so maybe it is wise to listen to the people telling you to go for it.

Good luck.

TRF
03-10-2010, 09:09 AM
Part of my package is a $1500 scholarship. Yay?

I applied to a few backup schools, yes, but questioned even before I was accepted anywhere whether that was a good decision. It's cheaper but it's not a great career move. It's not a terminal degree and so would not permit me to teach at the college level, which is one of my goals. To do that I'd have to continue onto a PhD, which for many reasons is not something I really want to do.

There is one other comparable program on the table. But I consider it a distant option because a) they haven't accepted me yet (I interviewed last week and the decision is due any time now), b) it's not nearly as good a fit for me, and c) if I felt there was going to be a much better financial deal it would be much more in the forefront of my mind, but that's extremely unlikely. That school is notoriously stingy with funding and it's also a three-year program instead of two.

Without going into too many details because I think it would be confusing, the program is unusual. There are only a few in existence at all, and none are at public universities (there was one and I did apply there, but I'm getting the impression it's getting cut because of funding). So my options in that regard are limited. There's only so much pull I can have because no matter how much they "want" me, competition is stiff and each program only takes 3-4 students a year. You'd think they'd have more money to dole out, right? I really think that in anything non-profit related, people are so used to being in debt and having low-paying jobs that they just accept that it's the way it is. I am obviously having a hard time with that.

Re: dipping into retirement, to be honest, I don't even have enough yet to make it worth it, penalties or not.

Some encouraging things in this thread. A lot of things that make me want to curl up into a hole too.

I have a message in at the financial aid office and a page and a half of questions and talking points. Waiting for a call back now.

vp, millions in scholarships go unclaimed every year. I work for a community college, my daughter went to the university down the road, and the scholarships offered by the schools are usually in the neighborhood you mentioned. Almost always in memory of someone that went there, killed too soon etc.

For real scholarships sometimes you have to go the extra mile, apply to foundations, and a ton of research. There is a good scholarship out there that needs a home.

RichRed
03-10-2010, 09:48 AM
"People First, Then Money and Things afterwards". I believe in that.


Amen to this. Go for it. Life is short; do what you love. Some people never figure out what it is they love, so you're fortunate to be ahead of the game in that respect.

[Full disclosure: this comes from someone with no debt besides a mortgage, so take it for what it's worth.]

Ltlabner
03-10-2010, 01:59 PM
As others have said you have to consider your earning potential down the road and the availability of jobs in that market. It makes no sense to burden yourself with $110k of debt to "live a dream" if you'll end up making $35,000 down the road.

You also have to consider if having that degree will really do anything for your career. Sometimes having a masters does exactly nothing to gain you extra earning potential or responsibilities because it isn't needed. Another example would be the 27 year old who has a masters and 2 years of working experience. In many fields people simply aren't going to give you a job without the requisite experience.

If you've already addressed those issues I apologize. I haven't read the entire thread.

I guess I'm a party-pooper but while "living your dream" sounds like fun burdening yourself with crushing debt that will hamper your lifestyle for 15+ years post graduation doesn't make a lot of sense. And frankly, that sort of debt can impact a lot of options down the road that are of little consideration now. I like options, not being forced to row in one direction because of a decision I made 10 years ago.

vaticanplum
03-10-2010, 04:14 PM
:explode:

I have been doing research for two days, and I think I am more confused now than when I started.

RichRed
03-10-2010, 04:23 PM
:explode:

I have been doing research for two days, and I think I am more confused now than when I started.

That's what we're here for - you're welcome. :)

wolfboy
03-10-2010, 06:19 PM
Law degrees? I have one, so I can't necessarily tell people don't do it. However, I emphasize strongly that anyone considering it thing long and hard about whether they are doing it for the right reasons. If you do it because you have a passion for the law, that's one thing. If you're doing it because you thing it's going to result in lots of money and job security, think again.

Best advice a potential law student could have. I think it probably applies to your situation as well, VP. The future is uncertain. You could get lucky and find a dream job or you could struggle to find a job at all. Either way, the student debt is going to be a big burden. If you have a passion and love for what you'll be doing then no challenge is too tall.

MWM
03-10-2010, 06:44 PM
For the record, I'm a big proponent of the belief that "chasing dreams" is a big waste of time and that too many supposedly inspirational speakers or authors talk about "never give up on your dreams." I read these types of quotes all the time and I think it's just bad advice. Most people that chase a dream wind up dejected and broke with few prospects.

But the folly of chasing dreams is generally around things like athletes who think if they try harder or get a lucky break they're going to make it in the pros. There's also actors and musicians thinking they're going to hit the big time when there are thousands of wash outs for every lucky group or person to hit it big. I have a good friend who wanted to make it in the theater clear in to his mid-30s. He was determined to make it and go to Broadway. Problem was, he just wasn't that talented. He thought he was, and he was OK, but he was not Broadway material. He's now late 30s with no skills and no prospects for any kind of stable future.

I don't think what VP is talking about here falls into the "chasing a dream" category like some are implying in this thread. She's talking about a very reasonable career in a field she has a lot of passion for and which she's very qualified and will most likely actually get there if she completes her degree. I think this is very different that those who hold on to unrealistic dreams. My impression is that she's already somewhat involved in this field, but getting a degree would allow her to participate in a much more rewarding way. No one here knows what's right for her, and she'll make the right decision for her, but I wouldn't dismiss this as dream chasing.

Sea Ray
03-10-2010, 08:19 PM
My impression is that she's already somewhat involved in this field, but getting a degree would allow her to participate in a much more rewarding way. No one here knows what's right for her, and she'll make the right decision for her, but I wouldn't dismiss this as dream chasing.

The dream in all of this is that she can pay off a $100K debt on $35K a year. Something about those numbers has got to change...

Yachtzee
03-10-2010, 09:56 PM
The dream in all of this is that she can pay off a $100K debt on $35K a year. Something about those numbers has got to change...

The thing that will change is the salary. It's my understanding that that is her expected starting salary. We have no idea what the salary growth potential would be. There are a lot of law students graduating these days that are looking at starting salaries in that range. The difference is that it sounds like VP has a much higher potential for job stability than a graduating law student. Depending on what field she's in, and it sounds like it might involve working for non-profit organizations, she's got a reasonable chance of some decent salary growth over the years. There are quite a few people who make a good living working for non-profits and can end up doing very well for themselves if they have a passion for the work. You can't just assume that someone starting at $35K a year is going to be still making $35K a year 10-15 years down the road.

Sea Ray
03-11-2010, 11:12 AM
The thing that will change is the salary. It's my understanding that that is her expected starting salary. We have no idea what the salary growth potential would be. There are a lot of law students graduating these days that are looking at starting salaries in that range. The difference is that it sounds like VP has a much higher potential for job stability than a graduating law student. Depending on what field she's in, and it sounds like it might involve working for non-profit organizations, she's got a reasonable chance of some decent salary growth over the years. There are quite a few people who make a good living working for non-profits and can end up doing very well for themselves if they have a passion for the work. You can't just assume that someone starting at $35K a year is going to be still making $35K a year 10-15 years down the road.


I certainly hope $35K is just a starting salary. Potential for growth beyond that is the crux of this financially and we don't have that info.

Roy Tucker
03-11-2010, 11:23 AM
I'm supposedly a financial guy, but I'm going to agree with MWM on this. Go for your dream.



Yeah. The best piece of advice I got at the age of 21 was from my ex-father-in-law. He said "do what you love and the money will follow". I did that, didn't get into 5 figures for a few years, but it all turned out pretty darn well after that. Living cheap makes you appreciate living well. Things turn out best for the people who make the best of the way things turn out.

vaticanplum
03-11-2010, 07:40 PM
Well, I want to thank everyone for all of the advice and ideas in this thread. I really mean that -- much of it has been very tangibly helpful, and even just all of the perspectives, idealistic and realistic and everything in between, have been so valuable. There is tremendous benefit to objective opinions from people who know the world and not you and I can't really get that anywhere else.

Here is my update, since my decision is due tomorrow, and I'm sure you're all on the edge of your seats about what I'm going to do with my future. (But seriously, I have learned a lot the last few days, and some of it may even be valuable to others someday.)

Yesterday I bit the bullet and called the state school program (the only one that exists). I hadn't heard a word from them and just assumed for many reasons that the program had been cut or that they didn't want me, but for my own peace of mind I had to know. I let them know I was on a deadline to decide elsewhere, and the head of the program called me back right away and offered me acceptance...and some very decent financial aid. All told it's not much more non-loan money than I'm being offered by dream school, but the disparity in initial cost is quite great (though it's a three-year program vs. two at dream school). I talked to him for a while about the program because I hadn't had a great grasp of it before. I like it...it has a lot of the things I'm looking for, though its specialization is not an area that interests me. He made it pretty clear that I would be something of a big fish in a small pond there. That's never been something that appeals to me; I'd rather be challenged, but there are benefits to that in opportunities, both in school and beyond, as some in this thread have mentioned.

I was a mess. I did some more research on the program myself, and it didn't lead me to the greatest conclusions, quality-wise. But the financial difference cannot be ignored. So last night I turned to the experts. I called everyone I know in the field who has a sense of grad schools and jobs and that kind of thing. They actually made me feel a lot better about a lot of things. I have been looking at a worst-case scenario in most of my number crunching just to prepare myself. And while nobody can make me feel better about the sheer amount of debt I'm going to have from school, they reassured me of two important things. One: while the ecomomy is rough, and my field is rough, and education is rough, if I go to dream school, I should always be able to get a teaching job if I want it. Provided I work hard and all that, but I work like a crazy person. The connections and reputation of the school are so good that graduates will just generally be first in line for any teaching position. I'm still wary of blanket generalizations like that, but it reassures me a little bit.

Secondly, they think I'm underestimating my potential salary. Even if I have piecemeal work at first, the absolute bare minimum salary I should be able to get is $40-50K depending on location, with the potential of a lot more as time goes on. Again, of course, with work ethic and quality playing a role, but I still found that somewhat reassuring. Basically the general opinion from the experts is that the dream school is worth the cost, not only because of the personal satisfaction and quality education I will get there, but because of the tangible difference it's going to make in getting real-world work and well-paying work at that. I don't think this is the case in every field; I think in many cases you can distinguish yourself anywhere and get a similar education at a lot of places. But as I understand it this just isn't true for me. It's such a small field, with jobs so scarce, that educational disparities make a huge difference.

So I was pretty convinced. Then today I was finally able to talk with the financial aid person at dream school. She was wonderful and knowledgeable and talked me down from the ledge for over an hour. The bad news: there's no more money to be had. The loans aren't going away (though they will probably be decently reduced my second year of school). I offered to do anything to make more money, work for the department, anything, but grad students are split into those with teaching fellowships and those with work study, and since I have the former I can't get the latter. She did say that their estimates for cost of living are on the high side, and if I make a budget for myself that's lower, she can review it and let me know if she thinks it's viable so that I don't have to borrow quite as much.

The good news (and anyone ever considering grad school should pay attention here): There are private scholarships to be had, and I now have a list of options to pursue. More pressingly, there are also more repayment options for loan borrowers than I thought. Consolidation is still an option and consolidation with my college loans should also be an option, and actually a very good one, because the interest rates get combined somehow and I consolidated my college loans at a time when interest rates were very low, so that may slightly bring my graduate interest rates down after I graduate. (I also confirmed interest rates with her to begin with, as gonelong recommended.) There are benefits to be had for e.g., making repayments on time for a certain period, etc., as others have mentioned. She told me about something called income-based repayment, which is exactly what it sounds like and a nice option for someone not making a lot of money. But I said I assume interest would continue to compound on such a program, and she said yes, and then she said if this and that then interest is being added to interest, and then I started to convulse so we stopped talking about that.

But THEN she started to tell me about the thing that is going to be the shining beacon of hope in my soon-to-be-debt-filled existence: the PUBLIC SERVICE LOAN FORGIVENESS PLAN (https://www.dl.ed.gov/borrower/QCNews.do).

I had read about this in the 65-page financial packet and skimmed over it because I assumed it had to do with military service, which is likely not something in my future. Well, no. The gist of this program is that all government loans -- Stafford, both subsidized and unsubsidized, AND Direct Plus loans, which are what you use when you've maxed out the Stafford loans, and which have the higher interest rates, and which will account for the largest portion of my loans at least the first year -- fall into this plan, which is a huge incentive (along with the lack of front-loaded repayments and consolidation and deferral options) not to get a private bank loan even though the interest rate and origination fee on a bank loan may be better. If you work 10 years in any public service area -- military, education, any non-profit [501(c)(3)], i.e., pretty much every job I'm likely ever to have, and pay off your loans for 10 years, after those 10 years are up, your student debt is FORGIVEN.

For real. i have been looking for the catch to this all day. The only potential one I can find is that it has to be a full-time job, so a cornucopia of adjunct work or whatever probably would not qualify. But still, this is a HUGE relief to me (and also for like eight people I know whom I called immediately after learning this), and it is also very good to know up front, because I might have tried to push for a 10-year repayment and died under the strain, but if get work where I qualify for this, then it's obviously much better to take a 30-year repayment plan and weather the lower payments for 10 years. She said that this initially started with doctors and lawyers in mind...these people can come out of school with $150, 175K in loans and literally have no choice but to go into the private sector, and there has to be some incentive, any incentive anywhere at all, for people to go into public service. I asked her if, you know, such-and-such gets elected in three years, is this going to go away, so we talked a little bit about political ramifications and it was a very interesting discussion actually. This woman meets with lobbyists on a regular basis and knows her stuff. I also asked her if it has to be 10 consecutive years, so for example if I work in public service for three years and then take time off to have a baby and pack it off to the poorhouse, or I take a private sector job for a couple of years, do I have to start all over, and she said no, it's cumulative. (which is backed up by the way it's phrased on the government website -- they don't refer to it as 10 years' service but rather as 120 student loan payments.)

FYI, there is also a bill under consideration for the private sector, for either 20 or 25 years. i.e., if you have been making consistent payments on your student loans for 25 years, for crying out loud you should get a break. But this bill is on the back burner probably until health care is straightened out.

I'm sorry this is so long. I have been ingesting a lot of information this week.

So I felt better, and I'm still very daunted by the sheer amount of money involved in all of it, but all told I think dream school is the best choice. And then this afternoon I got a call and acceptance from ANOTHER school. I mentioned this school earlier -- it's comparable academically and reputation-wise, though isn't as close a fit to my personal philosphies as dream school. But I adore and respect the head of the program, and when I asked when financial aid information would be coming, he said about a month unless I have a decision to make, in which case they'll try to push it through sooner. I said, yeah, I kinda do, though I didn't tell him my decision date is tomorrow. So what I have decided to do is pay the very substantial deposit to dream school tomorrow, and if this other school comes back with a truly amazing financial offer, even though I don't like it quite as well, I will swallow that deposit and go there.

I've done a lot of research and have a lot of information at my fingertips, and this is the decision that's going to cost me the least sleep, I think. I'm indulging myself in the dream program as my last great gift to myself, and the promise that I'm making is that given similar choices once the career kicks back in, I'll go with the financially better one in those cases. That could turn out to be a job in the private sector (though there aren't many of those in my field), or it could mean sticking with a less desirable job in the public sector to qualify for the public service forgiveness. And of course, it's a given that I'm going to work my tail off and make as many connections as I can. And purchase a life insurance policy so that my funeral and debts are covered for my next of kin when I graduate, realize the extent of my debt, and inevitably throw myself off a bridge.

MWM and others had my back on this, but this isn't a pipe dream. If it was as simple as pursuing my dreams, I'd be running around Tuscany in vintage sundresses with a baseball bat and a hookah. I've been working toward this most of my life, making many sacrifices along the way, and a huge part of the decision to go to grad school was a practical one, because it opens so many more doors in my field, including the only ones that are even remotely lucrative. This *is* what I want to do, and yes it's my dream field and school and I feel lucky to pursue it, but it's also a very considered practical decision despite the potential debt. I currently have a well-paying job that I absolutely love and is almost everything I could ask for in a practical sense -- and it's not enough for me. I know now, actually not theoretically, that it's not going to sustain me forever and that a job I truly love is more important to me than comforts. So I have no doubts, and no regrets, and despite this tremendous financial burden I do believe I will be ok, as many in this thread have said. I will just have to watch my budgeting. Religiously. My whole life. It's ok.

MWM
03-11-2010, 08:00 PM
Congrats, VP. Your process for evaluating this decision was very wise. Good luck to you.

RichRed
03-11-2010, 08:12 PM
Good for you, vp! You've done your homework and chosen your path. I'm sure success will follow. On those nights you can't sleep, hop on the computer and give us some updates on how it's going. Best of luck to you.

oneupper
03-11-2010, 08:46 PM
In 5 years you're going to be saying "Why the %^$* was I worrying so much?"

(or "why the %^$* did I ask a bunch of baseball fans about this?").

Best of luck.

15fan
03-11-2010, 11:45 PM
:clap:

Go get it, and don't look back.

George Foster
03-12-2010, 01:16 AM
good Luck!

KoryMac5
03-12-2010, 09:17 AM
The Public Service Loan Forgiveness Program is great if you have a lot of debt. You have to make 120 consecutive on time payments and they will forgive the balance if you serve in the Public Sector (ex. Dept of Veterans Affairs). So it's definitely something you should check out.

gonelong
03-12-2010, 10:17 AM
The updated numbers make this a much more palatable adventure (IMO) ... though still not for the faint of heart. Nonetheless, it sounds like you have a plan and are going into it with open eyes.

I wish you the best of luck.

GL

/chasin' a dream ain't easy, otherwise everybody would do it.

Yachtzee
03-12-2010, 07:03 PM
Good luck, VP! I wish you the best.

There's something to be said about picking the school and program that will be the most challenging. Although I loved law school and love what I do, I chose the program that, at the time, made the most sense economically, even though I had scholarship offers from 4 different schools. What they didn't tell us was that they were offering a scholarship to everyone and would only let the top 10 students keep it after the first year. Although I did well, I was handicapped by having a family to take care of, so I finished out of the top 10 and lost the full ride after year 1. If I had chosen the more reputable and expensive school, I would have probably come out about the same financially, but I would have been able to walk into most law firms and get a job right away.

Overall, I still feel I made the right decision to go to school though.

MWM
03-12-2010, 07:12 PM
FWIW, I also had a similar choice as far as schools go. I got into my top choice program (Michigan) but not much financial aid. I had an opportunity to go to a lesser program (ironically, Ohio State) but have it completely paid for. The field I was going into, Michigan is one of the top 2 in the country and OSU isn't really in the conversation. I decided to go to the better program and don't regret it at all. I wouldn't have been able to do what I've done since coming out of OSU.

SandyD
03-12-2010, 09:29 PM
Best of luck.

Hopefully, you'll be able to find some alternative aide like private scholarships, etc.

No matter what, don't look back.

cincinnati chili
03-13-2010, 09:00 AM
VP - so you've got us all on pins and needles. Give us a hint about the school. We know you like you're anonymity but Redszone can keep a secret. We won't tell.

Chip R
03-13-2010, 10:51 AM
Good luck!

vaticanplum
03-13-2010, 06:41 PM
The Public Service Loan Forgiveness Program is great if you have a lot of debt. You have to make 120 consecutive on time payments and they will forgive the balance if you serve in the Public Sector (ex. Dept of Veterans Affairs). So it's definitely something you should check out.

As I understand it, the 120 payments don't even have to be consecutive...meaning not that you can skip payments on your student loans, but you can, for example, take a couple of years off to work in the private sector and start up again when you return to the public sector. The payments you make during your time in private business won't count toward the program, but you don't have to start from scratch when you return to the public sector.

Thanks for all the well wishes everyone, they mean a lot. I slept for ELEVEN HOURS last night so I guess I'm at peace-ish with this decision.

SunDeck
03-13-2010, 07:29 PM
Excellent! It never fails to impress me how much knowledge and good advice there is to be had here. Best of luck VP.

Redsfan320
03-13-2010, 07:39 PM
Good Luck from me too! Congrats on finding your dream!

320