I’ve made several financial mistakes in my lifetime that I wish I could take back. I’m not referring to overspending on a new pair of shoes or eating out one too many times. I’m talking about the biggest money mistake I have ever made. It has cost me thousands, a lot of headaches, and even the ability to reach the financial freedom I hoped for in my 30s.
What is this mistake that I’m referring to? Taking out student loans.
I understand that most times avoiding any form of student loan won’t be an option. However, if you know you can fall back on a student loan you’ll be less likely to try to pay for your education upfront. I found myself in this position when I decided to obtain a Business degree in my 20s. I quit my job at the time to go to school full-time and found myself maxing out on my loans just to take care of everyday bills. Why? Because I thought it was the smart thing to do. I talked myself into believing that this was the way to do it and since this would help me reach my career goals one day, I could justify my actions. Today, I still have student loans that hinder me from reaching the financial freedom I hoped to have as an adult.
So in hindsight, this is what I would have done differently:
I would have kept my job
I wanted to obtain my degree in the traditional 4-year time frame so I quit my job. This cut our family income in half and also contributed to our debt. I needed to take out the maximum loan amounts available in order to pay for some of our living expenses. I went back to work after a few semesters, but the damage was already done.
Paid in full
I would have paid for my tuition in full one class at a time. With careful budgeting along with a second income, I truly think this could have been a possibility. It probably would have taken me several years to graduate, but right now I would have been completely student loan free. It’s hard to foresee what the future holds when in college, but knowing what I know now I would have gladly taken my time.
I would have waited
I didn’t go to college right out of high school which is probably what fueled my desire to obtain my degree in my 20s. However, looking back I wish I had waited even more. Why? Because every job I held after my degree didn’t require me to have it. My work experience was more valuable in each case. I also worked for myself at different points and once again, no degree was necessary.
There were some positives for me in this whole ordeal. Graduating with top honors as an adult with two small kids was an amazing feeling knowing I had to work twice as hard to earn it. I still remember walking the stage with pride while my parents watched proudly-the first member in the family to obtain a college degree. I also know that I have been able to set myself apart in my businesses because of what I learned in school. I just wish it didn’t cost me so much financially…
Have you ever made a big money decision that you later regretted? I would love it if you shared!
The college degree isn’t just the ability to find meaningful employment. It also lends to being an educated person. A critical thinker. A well rounded individual. Learning the human condition. I think investing in yourself is never a bad thing. People invest in property and THINGS. I’d rather pay my student loan bill and know I’m educated than pay a mortgage and know nothing . Knowledge is invaluable. IF loans are how you get there, do it. We need more educated people in the world. And in the future, the unskilled labor force is dwindling.
I am visiting from the Frugal Friday Link Up Party. I despise y student loans… I owe tons of money, and I don’t use my degree. pointless… 🙁
Another school option that many do not consider is attending a local Community College first . While there, obtain the “core curriculum” necessary at all schools (like English classes, History and some Sciences) and then transfer those credits to the preferred college of your choice. The schools can help you determine what is transferable/or not before you sign up for classes. Money saved in the first two years or so helps minimize the debt in the long run.
The biggest money decision that I regret is selling our duplex. Sure we were able to pay more down on our house but the duplex would have been paid off by now and we would be collecting rent! What were we thinking?!!!;0)
Dumbest *large* mistakes we ever made were overspending on the wedding (and not realizing it until all was said and done) and going to a full commission job at the same time as my husband. Still paying for both of those bad decisions.
I couldn’t agree more, Jesenia! I hate being in debt right now. But on the bright side, mine will be paid off in less than a year! I can finally see the light at the end of the tunnel!!! Lol
We’re in the same club my friend! I wish I had NEVER taken out those stupid things. I worked full-time and went to school full-time while earning mine but I still had to take out loans. I wish I would have saved up the money instead of taking out the loans. Truthfully, the market is so saturated with college graduates that many are making well below what they should be and many are struggling to find a job because of the “experience” requirement. I think it’s imperative that students at least save up half of what they expect to pay in tuition before going to college.
Love this post! 🙂
That’s a great tip and I completely agree. Even working while in school can help offset the costs. The job market is very saturated and combined with a shaky economy, even a degree does not guarantee a great paying job. Thanks for sharing Jessi!
If you research this idea a bit, you will find that this is not great advice for everyone. Student loans are a pain, yes, but for many, the faster you finish your degree, the sooner you can begin working in your career field and start making a living. This usually means taking lots of credits and pushing through college quickly which makes working full-time implausible. Of course there are several factors that may affect this scenario which would change the circumstances. For example, if you choose a major that doesn’t help you obtain a great job, etc. Wise decisions about college majors is a whole different discussion.
Students also don’t need to max out on loans. As you mentioned, careful budgeting will help a lot. I used to work at a law school and our advice about student loans was that if you take out loans and live like a lawyer is school, you will love like a student upon graduation. Just be smart.
The work you have done that doesn’t require a degree is fabulous but studies also show that the more educate done is, the more money they will make in their lifetime, i.e., having a high school diploma vs a graduate degree.
Thanks for your feedback Gwen! Oh, I would never imply that this is what everyone should do, but in my case a degree was not necessarily worth the cost. I still owe several thousand dollars and I truly never needed my degree for any of my jobs.
Now I know that for someone coming right out of high school it doesn’t make sense to wait forever to get a degree, but in my case I should have waited. Student loan debt is at an all time high and it’s sad that some will find a great job after college (although not always the case!), but will be spending a chunk of their income paying off student loans.