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The True Cost of Student Loans

By Edited Nov 13, 2013 1 3
Credit: morguefile

When I started college at 18, I believed that student loans were just part of the college experience. The only people who did not get student loans were kids from extremely rich families, exceptional athletes, or geniuses. I did not fall into any of those categories, so I completed the student loan application without a second thought. My mom assured me that she would help me pay the loans back, and I was confident that I would get an amazing job after graduation. I took out loans to cover the cost of tuition and part of the cost of living. I did receive some grant and scholarship money, which added up to about $30,000 over the course of my undergraduate and graduate programs. The grant and scholarship money helped out greatly, but it was only about half of what I used to get through college. Now, four years after graduating, I am learning the true cost of student loans.

Plans Change

Six months after graduating college, I had to start paying back my student loans. My mom really did intend to help me pay them back, but my younger sister was in college and my parents were attempting to pay for her education with cash. They learned from my experience that the student loans add up fast and wanted to avoid that for my sister. Plans changed and my parents were unable to help me pay off my student loans. The student loans were in my name, and they were for my education so I am paying them.

I did get an amazing job after college, but it does not pay very well. Our first child was born while I was in graduate school. When I finished school, I decided to stay home with him. I always wanted children, but I imagined myself as more of a career woman than a stay-at-home mom. My plans changed, and I decided to postpone my career until my children start school. Unfortunately, my student loan payments did not go away when I decided to stay home.

These changes in plans left me owing more money than I expected with less income than I had hoped. Between mine and my husband’s student loans, we pay nearly $400.00 per month. Thankfully, my husband’s income is sufficient enough to allow me to stay home. The situation could have easily been different, with my student loan payments making it impossible for me to stay home with my children. The true cost of the loans would go way beyond money.

Long-Term Commitment

We made the first payment on my husband’s student loan six years ago. To date, we have paid off roughly 35% of the original balance of his student loan. We have also paid an almost equal amount of interest. His original student loan was for $12,335.83 and we have paid a total of $4,429.78 toward the principle. Over the last six years, we have also paid a total of $4,097.33 in interest on his student loan. The original $12,000 loan has now cost us $16,000, and that number will continue to rise as time goes on and interest continues to accrue.

You need to ask yourself how much you are really willing to pay for the college you want to attend. The cost of education increases exponentially if you get student loans. On many of the loans, interest begins to accrue immediately. You do not have to make payments on the loans until you graduate or quit going to college, but you are already being charged interest on the money you borrowed. Is the school you want to attend worth double, or more, than what the university is charging for tuition?

I did not ask myself these questions before I decided to take out student loans, and no one around me asked these questions either. My student loans are much higher than my husband’s. I used his as an example because I honestly cannot face the true cost of my student loans. It is heartbreaking to know that I could have saved so much money by paying for college with cash instead of student loans.

The Alternative

I finished my undergraduate degree in three and half years. I worked part time as a nanny for some extra cash, but I never worked fulltime during college. Looking back, I could have slowed down and worked fulltime to pay for my tuition with cash. In order to work fulltime, I most likely would not have been able to take a full load of classes every semester. It may have set me back and extra year, which is not ideal. However, I would not have the burden of student loans after college.

In hindsight, I wish I would have worked throughout college to avoid student loans. As my younger brother started college, I pleaded with him every step of the way to avoid student loans. I showed him how much of our loan payments were going toward interest. He continued to live at home with my parents and worked fulltime for a large portion of his college career. He is in his last year and has avoided going into major debt to pay for school. It has taken him longer than four years to finish his undergraduate degree, but he will not be burdened with the amount of debt that my husband and I face.

In a perfect world, we could all move away from home at 18, attend our college of choice, and get the full ‘college experience’ without worrying about where the money will come from. Many people do leave home and have a wonderful college experience financed with student loans. Then, for the next twenty or thirty years the same students continue to pay for that ‘college experience.’ I had fun in college, but the experience came at too high of a cost. Before you take out student loans, take time to consider what your education will cost if you pay for it with student loans.

You may have to live at home, go to a less expensive school, and/or take more time to finish school if you want to avoid student loans. It is more difficult to work and go to school, but it only lasts for a few years. If you take out thousands of dollars in student loans, it will likely take you decades to pay them back, and you will end up paying thousands more than you borrowed in interest. It is worth the sacrifice to avoid student loans, take it from someone who experiences the true cost of student loans every single month.


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Aug 27, 2013 9:28pm
Student loans are incredibly scary. I luckily got through undergrad with no loans, but had to take them on in grad school. Grad School loans run at higher rates (6.8-7.1%) which is terrible, and they are quickly becoming to feel like the golden handcuffs I was warned about.
Aug 28, 2013 10:49am
Grad school classes are also a lot more expensive than undergrad classes, so the loans can add up quickly. I hope your advanced degree will help you bring in a higher income to pay off the loans faster. When I finish paying off my loans I literally plan on throwing a party to celebrate!
Nov 19, 2013 9:23am
Good article, as the cost of college keeps rising this will become a bigger issue. At the time, it seems like loans are easy money and many people don't fully comprehend their actual cost.
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