I come from a single mom household of two kids, and under 30k a year- many years were closer to 15-20, so you are not alone.Originally Posted by KellyDKim
The way I look at it, is I plan on making roughly 50-60k a year, by using this education I gain- It's actually not that outrageous a sum according to many statistics. hell, if i can make 30k a year, I'm doing better than I am now (and better than a lot of others too).
If I look at going to school as being part of my professional life- In a way it is just the life expense I plan to one day make. If I make and spend 60k a year- 240 over four years is about right.
Also with a decent payment system, It won't be a lifetime of payments- and with correct investments along the way- you could end up quite secure. I don't fully understand all the ins and outs of finance, but as I'm learning, it seems that us who don't know all that don't come from money, should learn to look at debt not as only a bad thing- but sort of a neutral thing depending on what it is for...
worst come to worst, file for bankruptcy- get your debt cut into I think it's a third of it's amount- and then get a descent job, and slowly build your credit up again from terrible. It's hard but people do it regularly.
I think I heard something during the election cycle, that just as Obama was elected president he finished paying off his college debt. All I could think was, "wow".
and about loans- I doubt I know anymore than anyone else whose never taken one out- but they seem to be based on assets and credit levels. As we, as young people, some of whom have never had a job, have next to no credit, the loans may have to be taken out in someone else's name, or as a co-signer. In most instances, the banks weigh the credibility of the reason for the loan, and the likely hood of seeing a return before they give a loan out. As college education is often seen as a means to increase money making ability, often loans are readily given for college educations as long as one can show credit scores are high. with many other loans sometimes equal money must exist in ones account before a loan can be taken out, or one must have a history of doing good on loans. Real estate and school loans are some of the easiest to get- as they seem to be the most secure forms of investment (at least on paper).
Things to look out for in loans are obviously the interest rates, the cost of the loan (often called points), and the payment method set up. Many loans "cost" a certain amount, so if you take out a 30k loan, you may only actually get a 25k payment on it (I'm not fully sure of how this works). With the payment method, often the lowest payment plan (the one a lot of people jump on) is simply paying off the interest, not the loan- this does nothing to lower ones amount of debt.
The next thing is checking on when the loan is due- Some loans build interest as soon as they are given, while others build after a certain point, or not until one is out of school for a set amount of time (i think it is often 6 months). I believe payment periods are variable to each loan type- though it does make sense that what ever the loan, or when ever payments are do, paying off as much as possible, as soon as possible is always the best...
but you cannot always pay off a loan as soon as you get it, or there may be penalties- banks plan on a certain amount of the interest build up that one pays while having a loan, so often there are clauses in the contract, where you will be fined if you pay off the whole loan before a certain point.
last thing about loans I can think of, is making sure you know where/how the money in the loan can be used. some loans are given directly as money- use if for what you want- school, housing, what ever- it's money. others can be used for only particular items- such as only school, only homes... and then, some loans are given directly to the institution, and you basically never have a chance to decide what to do with it- your job with the last kind of loan is just to pay what ever the amount you pay on it is, and the rest is dealt with between the bank and educational institution.
NOw is all this on loans 100% absolutly correct? I doubt it- it's how I understand it, and I am still very very green to the understanding of all of this. this is how it's been explained to me, and how I personally understand what I've read. Please if anyone sees anything wrong with what I said, do not be afraid to correct that information!
I really don't know anything- this is just my understanding, and I have no more and probably a lot les experience with these things than most. but to those who It might help, pleased to be of service.
Reply With Quote
Bookmarks