Why I Defaulted on My Student Loans(nytimes.com)
nytimes.com
Why I Defaulted on My Student Loans
http://www.nytimes.com/2015/06/07/opinion/sunday/why-i-defaulted-on-my-student-loans.html?_r=0
13 comments
The truth is these kids aren't really adults, and no one along the way is incentivized to stop them and say "hey, you may be making a really terrible decision here." Instead, everyone encourages them. English major? Great! No major? Even better! You have time to decide! $100k in debt? A degree is worth it!
Thankfully I had programming skills to fall back on, but when you're 18 years old and you're surrounded by people giving you awful advice that could ruin your life, you may not be able to recognize it.
Thankfully I had programming skills to fall back on, but when you're 18 years old and you're surrounded by people giving you awful advice that could ruin your life, you may not be able to recognize it.
"when you're 18 years old and you're surrounded by people giving you awful advice that could ruin your life, you may not be able to recognize it"
I remember being 18 and I was terrified of loans, or of any kind of arrangements that could limit the options of my future! Advices, even ones that come from well-intended people, weren't worth much for me if they weren't supported by detailed plans in which I would end up OK. Receiving such insurance plans proved to be next to impossible, because and as you may presume, those who seriously suggest you mortgaging your life aren't the most forward-looking people!
...so no, I don't sympathize with that naive kid not thinking straight about his own future. I actually feel that this kind of practice represents one of our time's laws of natural selection.
I remember being 18 and I was terrified of loans, or of any kind of arrangements that could limit the options of my future! Advices, even ones that come from well-intended people, weren't worth much for me if they weren't supported by detailed plans in which I would end up OK. Receiving such insurance plans proved to be next to impossible, because and as you may presume, those who seriously suggest you mortgaging your life aren't the most forward-looking people!
...so no, I don't sympathize with that naive kid not thinking straight about his own future. I actually feel that this kind of practice represents one of our time's laws of natural selection.
The point of being an adult is to be able to handle such influences. We treat them this way in loans, in other financial matters, in other contractual matters, and even in other areas (such as those relating to sex, where 'power difference' no longer applies once someone turns 18). About the only area where we do is with drinking age (in the US) and I find that to be quite unfair.
I do think our concept of adulthood is flawed and has major issues, but society will never tolerate fixing it because it would restrict rights based on abilities and many of those who are currently taken advantage of will not willingly surrender the rights that allow them to be taken advantage of.
I do think our concept of adulthood is flawed and has major issues, but society will never tolerate fixing it because it would restrict rights based on abilities and many of those who are currently taken advantage of will not willingly surrender the rights that allow them to be taken advantage of.
Absolutely true. But everyone still is responsible for their actions... even if they got bad advice. That to me is the definition of being an adult.
What? Why shouldn't people be able to walk away from any debt, and accept the consequences for that (like not being able to take out another student loan, bad credit for 7 years, harassing phone calls, etc)?
Well, to give a german perspective, over here it is considered unfair. To such an extend that tuition is basically free. The thing is we do not think one should indept himself to be able to achieve a degree, nor should he be forced to work to such an extend. I mean i admire you man, but looking carefully around you, you have got to admit that not everyone would be able to do this, would they?
People over here got enraged when the goverment tried to introduce tuition fees of 1000 Euros a year.
I actually think an economy profits if you make it easy for people to achieve an high education, and if you do not monitor them in the nature of the chosen field. And a society where you can do that and still have a normal and fullfilled life and being able to socially contribute to our society, that is the society i want to life in man. And while computer scientist are among the highest earner in germany, i gladly contribute my tax money to a society like this.
I do however realize that cultures a different and another point of view is just as valid as mine. Just wanted to maybe offer another perspective :)
People over here got enraged when the goverment tried to introduce tuition fees of 1000 Euros a year.
I actually think an economy profits if you make it easy for people to achieve an high education, and if you do not monitor them in the nature of the chosen field. And a society where you can do that and still have a normal and fullfilled life and being able to socially contribute to our society, that is the society i want to life in man. And while computer scientist are among the highest earner in germany, i gladly contribute my tax money to a society like this.
I do however realize that cultures a different and another point of view is just as valid as mine. Just wanted to maybe offer another perspective :)
I've explained this before: https://news.ycombinator.com/item?id=9102059 - when you start considering the entire world as the marketplace for the fruits of education, this (taxpayer subsidized) model leaves you in a bad position.
Well, actually its working out fine atm, thank you :)
There even was a article linked here about USA student coming to germany for education this week. It said that most of them stay. Turns out if you spend like 5 of your formative years at one place, you kind of build roots there. So maybe an attractive education system can actually help securing talent.
There even was a statement by a german official which roughly said that they are very happy with the current state of affairs, having the international exchange. If things get too out of hand, tuition fees for foreign students will be explored as an option though.
There even was a article linked here about USA student coming to germany for education this week. It said that most of them stay. Turns out if you spend like 5 of your formative years at one place, you kind of build roots there. So maybe an attractive education system can actually help securing talent.
There even was a statement by a german official which roughly said that they are very happy with the current state of affairs, having the international exchange. If things get too out of hand, tuition fees for foreign students will be explored as an option though.
"There even was a article linked here about USA student coming to germany for education this week. It said that most of them stay."
So Germany invested by subsidizing some (foreign) students and manages to benefit from the fruits of its own education investment - this is hardly the context I was talking about. I was talking about the case where a country like Germany educates for free its own citizens then they leave for greener pastures. The fact that your government managed to sell you the idea that everything is all right because at least some of the subsidized students (foreign and German) will stay is relevant only to your subjective contentment level. The overall picture can be judged pretty objectively.
"Turns out if you spend like 5 of your formative years at one place, you kind of build roots there."
These kind of people would probably rooted anywhere, in any condition, as its just a thing in their nature, not something to present as a resulting advantage of a given system. Maybe a small part them came to Germany because of something unique that they couldn't possibly find anywhere else, but I think that most likely the majority came to Germany just because of the prohibitive education costs in their own country. That's to say someone else's education system has a problem (by being unattractive in the current conditions) and that secures you incoming talent now. Just expecting others to continue having problems is not a very solid plan to rely on. I believe that it's possible to design the system a little bit better, where the students that have access to subsidized education may come to feel the education debts only when they try to emigrate (and take away the results of that subsidized education) or some other kind of solution to the leakage of public investment.
So Germany invested by subsidizing some (foreign) students and manages to benefit from the fruits of its own education investment - this is hardly the context I was talking about. I was talking about the case where a country like Germany educates for free its own citizens then they leave for greener pastures. The fact that your government managed to sell you the idea that everything is all right because at least some of the subsidized students (foreign and German) will stay is relevant only to your subjective contentment level. The overall picture can be judged pretty objectively.
"Turns out if you spend like 5 of your formative years at one place, you kind of build roots there."
These kind of people would probably rooted anywhere, in any condition, as its just a thing in their nature, not something to present as a resulting advantage of a given system. Maybe a small part them came to Germany because of something unique that they couldn't possibly find anywhere else, but I think that most likely the majority came to Germany just because of the prohibitive education costs in their own country. That's to say someone else's education system has a problem (by being unattractive in the current conditions) and that secures you incoming talent now. Just expecting others to continue having problems is not a very solid plan to rely on. I believe that it's possible to design the system a little bit better, where the students that have access to subsidized education may come to feel the education debts only when they try to emigrate (and take away the results of that subsidized education) or some other kind of solution to the leakage of public investment.
But thats exactly what I am saying. The cost for education in the US is prohibitve and so they decide to come to germany. If they find employment most people will stay where they got educated.
However, i do not actually think that this the point. Education has always profited heavily from a diverse enviroment, so we do profit from people all over the world coming to us. Besides, not everything is about investment, sometimes a society just has to decide what it values. We also have a really expensive social system. I value this highly and love it when my tax money goes to efforts like this. I mean sure, at the end of the day i probably contribute more than i recieve money wise, but living in a society where i feel comfortable is pretty valuable to me :)
Lasty, i think i can objectivly point out, that neither of us is very likely to make any objective statements without getting into heavy citations :)
However, i do not actually think that this the point. Education has always profited heavily from a diverse enviroment, so we do profit from people all over the world coming to us. Besides, not everything is about investment, sometimes a society just has to decide what it values. We also have a really expensive social system. I value this highly and love it when my tax money goes to efforts like this. I mean sure, at the end of the day i probably contribute more than i recieve money wise, but living in a society where i feel comfortable is pretty valuable to me :)
Lasty, i think i can objectivly point out, that neither of us is very likely to make any objective statements without getting into heavy citations :)
I think tuition trends are appalling and it's a real problem that so many students leave college saddled with debt that will drag them down for a decade or more. (It's also a little insane that even bankruptcy can't shed student loan debt.) However, it's really hard to sympathize with someone who went to Columbia to get not just one but three degrees rather than attend a state university because he "deserved better". Ten years of loans to attend a school that costs over $50K/year (today) and then playing the victim?
This seems a lot like buying a Ferrari because you need a car, instead of doing the sensible thing and getting a Civic. Sure, you've got crippling debt. But it seems entirely self-inflicted.
This seems a lot like buying a Ferrari because you need a car, instead of doing the sensible thing and getting a Civic. Sure, you've got crippling debt. But it seems entirely self-inflicted.
These kinds of op ed pieces are always shocking in the way they drip with entitlement. He quit his job as a shoe salesman, where he would be a district manager if he stayed he'll have you know, because he was just too good for that kind of job.
Why does he think that? Why does he think himself somehow above the other people selling shoes, and indeed the district managers of shoe-selling operations? Does he really think other people selling shoes couldn't have gotten a liberal arts degree from Columbia if they were willing to take on foolish amounts of debt?
Why does he think that? Why does he think himself somehow above the other people selling shoes, and indeed the district managers of shoe-selling operations? Does he really think other people selling shoes couldn't have gotten a liberal arts degree from Columbia if they were willing to take on foolish amounts of debt?
These entitled assholes and their liberal arts degrees. Why does this guy think that the State has to pay him to enjoy 4 years of reading whatever works of literature he found amusing. If he doesn't get any skills that make him employable ... then we the citizens of America have to subsidize his 4-year party?
Maybe this sir should have thought about what he was learning in school. And if he was too young to think about that at the time he went to school, maybe we shouldn't be giving him the power to make those spending decisions at that age--or maybe we should be withholding loans from students pursuing such worthless degree programs.
This idea that the world must mold itself to the interests of liberal arts students or the hysterical theories of liberal arts professors--oh reading the classics will expand your mind!--is a bunch of bullshit.
Of course the liberal arts faculty want you to keep buying into the failed state that is their department. That's the only way they keep chugging along. But employers have long ago figured out that they want to hire smart kids. And smart kids were smart before they entered these programs.
Maybe this sir should have thought about what he was learning in school. And if he was too young to think about that at the time he went to school, maybe we shouldn't be giving him the power to make those spending decisions at that age--or maybe we should be withholding loans from students pursuing such worthless degree programs.
This idea that the world must mold itself to the interests of liberal arts students or the hysterical theories of liberal arts professors--oh reading the classics will expand your mind!--is a bunch of bullshit.
Of course the liberal arts faculty want you to keep buying into the failed state that is their department. That's the only way they keep chugging along. But employers have long ago figured out that they want to hire smart kids. And smart kids were smart before they entered these programs.
"Of course the liberal arts faculty want you to keep buying into the failed state that is their department"
I think you hit the nail on the head here. I distinctly remember almost every intro class I took the professor would try to sell me on the fact that it would be the greatest degree ever. Unfortunately, while some areas of study may be interesting, they are not always a good ROI and I think that is what alot of college kids don't understand.
I think you hit the nail on the head here. I distinctly remember almost every intro class I took the professor would try to sell me on the fact that it would be the greatest degree ever. Unfortunately, while some areas of study may be interesting, they are not always a good ROI and I think that is what alot of college kids don't understand.
To be fair to the professors, they wouldn't be teaching intro to whatever if they weren't genuinely enthusiastic about the subject.
Also, while the ROI on some majors is terribly negative over a large population, that choice has likely worked out very well for the professors teaching the class. A tenured position at a major university is the closest you're ever going to get in life to a sure thing.
Also, while the ROI on some majors is terribly negative over a large population, that choice has likely worked out very well for the professors teaching the class. A tenured position at a major university is the closest you're ever going to get in life to a sure thing.
Well, i would not like to live in a society you describe. Even though my skillset is contributing to society, i actually think with the state of modern societies it is more than affordable to invest in freedom of individual of personel development.
In the end, each society has to decide for themself in what they want to invest.
In the end, each society has to decide for themself in what they want to invest.
It all went to hell in 2005 because of this little gem:
http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and...
See, there are two primary forms of financing for higher education: The heavily regulated federal market, where the federal government guarantees the loans, but also maintains rules that ensure that repayment is affordable by way of myriad flexibility in repayment (including a very reasonable $50k total cap in principal lended), and the private market which is very much similar to other forms of consumer financing.
The BAPCPA changed the rules and handed out protection to private lenders outside of the federal system that made private student loans special in that they became nondischargable in bankruptcy.
Now take a room, throw in some profit hungry lenders drunk on an elixir or reduced risk prepared by the federal government, a bunch of kids that aren't old enough to drink, some old school notions about the value of expensive college degrees, more old school notions about the value of liberal arts degrees and a pile of overzealous university administrators looking to expand by pushing overpriced preparation for vaporcareers and guess what you get, this mess.
http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and...
See, there are two primary forms of financing for higher education: The heavily regulated federal market, where the federal government guarantees the loans, but also maintains rules that ensure that repayment is affordable by way of myriad flexibility in repayment (including a very reasonable $50k total cap in principal lended), and the private market which is very much similar to other forms of consumer financing.
The BAPCPA changed the rules and handed out protection to private lenders outside of the federal system that made private student loans special in that they became nondischargable in bankruptcy.
Now take a room, throw in some profit hungry lenders drunk on an elixir or reduced risk prepared by the federal government, a bunch of kids that aren't old enough to drink, some old school notions about the value of expensive college degrees, more old school notions about the value of liberal arts degrees and a pile of overzealous university administrators looking to expand by pushing overpriced preparation for vaporcareers and guess what you get, this mess.
Finally an actual factual and interesting comment instead of moralizing. Apparently 16 year olds cannot drink or have consensual sex (in most states) but are capable of taking out loans for hundred of thousands of dollars and make accurate predictions of the viability of various careers.
I don't understand how people can be so sure that they've made the right choice: If society isn't willing to give you anything for it, how are you sure it's your 'usefulness in life'? Usefulness to whom?
How is this person supposed to be a sympathetic character, when he paid none of the investment towards higher education, reaped a number of the benefits, and then lumps people who played by the rules/lived within their means as sad?
The sheer level of entitlement and narcissism displayed by acknowledging "I could give up what had become my vocation (in my case, being a writer) and take a job that I didn’t want in order to repay the huge debt I had accumulated in college and graduate school" but then going on to shirk the debt for your own personal benefit is disgusting.
How is this person supposed to be a sympathetic character, when he paid none of the investment towards higher education, reaped a number of the benefits, and then lumps people who played by the rules/lived within their means as sad?
The sheer level of entitlement and narcissism displayed by acknowledging "I could give up what had become my vocation (in my case, being a writer) and take a job that I didn’t want in order to repay the huge debt I had accumulated in college and graduate school" but then going on to shirk the debt for your own personal benefit is disgusting.
"If society isn't willing to give you anything for it, how are you sure it's your 'usefulness in life'?"
Because usefulness isn't measured only in money.
(Think of the children! No, really. They cost a ton, no guarantee they'll live to support you in your dotage even, but people still have them.)
Because usefulness isn't measured only in money.
(Think of the children! No, really. They cost a ton, no guarantee they'll live to support you in your dotage even, but people still have them.)
Society gives you a ton of validation, support, and encouragement to pursue having/raising children well. I'm not saying usefulness is only measured in money, but money is definitely one of many barometers to gauge if you're doing something useful. Seeing as this article specifically discussed his career, I think that money is a pertinent measure of what society would like you to do/you should do to fulfill your obligations.
Sociopath Explains Why He’s Above Paying Off His Debts: http://freebeacon.com/blog/sociopath-explains-why-hes-above-...
I'm sorry, but if you want to go to college, it's all a business. The experience you get, the paper you receive guarantees you nothing. You make college what you will. Banks and loan companies offer to lend you money with the intentions of running their own business. I graduated with $40,000 of debt. I got a job making $12 an hour as a programmer, way underpaid, and knew there was no way I was going to be debt-free ever, or so I thought. For a year, I did my best, got one raise, but I couldn't take it anymore, and decided to apply for new jobs, considering I had a college education, I had an advantage above many others. I applied and got 2 jobs. I worked about 18 hours a day for almost a year, and after all was said and done, it took me about 2 1/2 years to pay it back. After that, the IRS decided to come after me with a slap in the face asking for $6,000. I eventually paid off my student loans AND the IRS, and the next year after that, I ended up owing the IRS $3,000 more, but that is life and reality. I paid it off, changed my w4 so they take everything from me up front in hopes that I owe nothing anymore, and I am comfortably working in a job I love debt-free. Welcome to life. Defaulting does make you delinquent in the eyes of the law, or the loan companies, as well you should be. If I lent you $10,000 and told you I was charging you 6% interest, I'd expect to be paid back the original $10,000 I lent you and all the interest you accrued for each year you couldn't afford to pay me back. Welcome to the real world, my friend. Welcome to owning up to your responsibilities. Oh wait... you didn't do that.
I do agree with you that education is overpriced and the value for your buck is insane, but people are paying it, and those who do, especially those who are studying the right fields of science, mathematics, medical, engineering, and computer science are coming out on top and making great money. With the exception of several degrees in which a further education is necessary, those who study anything else tend to find it harder and rougher to get jobs. Truth about the workforce is: YOU NEED SKILLS. YOU NEED TO FIND SOMETHING THAT MAKES YOU IN DEMAND! Unfortunately, the college degree helps you get into the door, but it's what you truly have to offer that brings you much further in life. In my case, I am extremely good at picking up new computer languages, from computer programming to web design. Add value to yourself by acquiring new skills and selling them to companies.
I do agree with you that education is overpriced and the value for your buck is insane, but people are paying it, and those who do, especially those who are studying the right fields of science, mathematics, medical, engineering, and computer science are coming out on top and making great money. With the exception of several degrees in which a further education is necessary, those who study anything else tend to find it harder and rougher to get jobs. Truth about the workforce is: YOU NEED SKILLS. YOU NEED TO FIND SOMETHING THAT MAKES YOU IN DEMAND! Unfortunately, the college degree helps you get into the door, but it's what you truly have to offer that brings you much further in life. In my case, I am extremely good at picking up new computer languages, from computer programming to web design. Add value to yourself by acquiring new skills and selling them to companies.
My first reaction was the same as many comments below. "He made a poor choice and now doesn't want to take responsibility."
But...
I was talking to my sister the other day, who just graduated from an Ivy League school. All her life she's been in accelerated programs with other well-to-do kids. I realized that she has always interacted with people with above average intelligence, above average connections, above average wealth. I'm betting that many HNers have at least one of those privileges. The overwhelming majority of people do not.
Over time I see a recurring theme: that people who are uneducated and poor are so easily taken advantage of. I've seen single moms lease $30000 SUVs for 600 a month. People who, after work, sit in front of the television and spend -all their money on the weekends.
The world makes it so easy to fuck up. I always have to remind myself, a person with the single privilege of above average intelligence: what is obvious to me is not obvious to others. Yes, books are ubiquitous and cheap. Yes, people should know what they are signing up for. Yes, debts should be paid. But perhaps these things some of us take for granted as simple realities are not so obvious for an overwhelming majority. It is not their fault.
But...
I was talking to my sister the other day, who just graduated from an Ivy League school. All her life she's been in accelerated programs with other well-to-do kids. I realized that she has always interacted with people with above average intelligence, above average connections, above average wealth. I'm betting that many HNers have at least one of those privileges. The overwhelming majority of people do not.
Over time I see a recurring theme: that people who are uneducated and poor are so easily taken advantage of. I've seen single moms lease $30000 SUVs for 600 a month. People who, after work, sit in front of the television and spend -all their money on the weekends.
The world makes it so easy to fuck up. I always have to remind myself, a person with the single privilege of above average intelligence: what is obvious to me is not obvious to others. Yes, books are ubiquitous and cheap. Yes, people should know what they are signing up for. Yes, debts should be paid. But perhaps these things some of us take for granted as simple realities are not so obvious for an overwhelming majority. It is not their fault.
>I've seen single moms lease $30000 SUVs for 600 a month.
The alternative is to tell them they aren't educated enough to take out a lease.
Imagine how this would be applied to other scenarios. Say... telling someone they aren't educated/financially secure enough to have children.
The alternative is to tell them they aren't educated enough to take out a lease.
Imagine how this would be applied to other scenarios. Say... telling someone they aren't educated/financially secure enough to have children.
It's interesting that what we consider to be barbaric and primitive was a poor lower class of people who were uneducated while their lives were indentured. Now we have educated people who's lives are indentured.
Do you think the writer of this article actually got educated? I would argue they have not been educated, nor have they matured.
And that right there is an indictment of the college system.
And that right there is an indictment of the college system.
Hey why not? The system is, in a word, fucked. Something huge is needed to shake it up, and a massive wave of irresponsible defaults would certainly focus efforts.
For a variety of opinions about this, don't overlook the 697 comments at the article itself.
tldr; too bad that the majority of student loans are issued by the US government and filing bankruptcy doesn't clear them from your credit history...
While you got to party in College on someone else's dime, I worked 80 hours per week and built my career. I'm sorry your choice didn't pan out the way you thought it would but I'm really getting tired of the idea that people should just be able to walk away from student loan debt because they believe it is "unfair."