Reposted from Dave Ramsey article.
School of Hard Knocks
Sadly, the phrase "student loan" is becoming as much a part of our vocabulary as the word "college."
A new poll by the Associated Press and Viacom finds that almost 6 in 10 students rely on loans to help with the cost of school. That's a very sad stat. It's become more common to just borrow money than it is to look for a more affordable college or find better means to pay for it.
But going to school without debt is simpler than you think. Not easier, but simpler. Here's an example.
Let's say you want to go to an in-state school that costs $15,000 a year for everything. That's $1,250 a month. If you get a job making $10 an hour and you work 30 hours a week (which is very doable, even for a full-time student), that's $1,200 a month during the school year.
"Now wait," you might be saying. "That's not enough to cover the cost of school, and you haven't taken out money for taxes and gas." Right on both counts, but we also haven't talked about working during the summer or Christmas break (where you have no expenses and more time to work).
If you work a full 40-hour schedule during the summer and December, you can make between $6,000 and $7,000. When combined with your school-year income, you'll have enough for expenses and even some fun money, and that doesn't include parents helping to pay, working more than 30 hours a week, or even scholarship money.
Even better, doing this means you don't have a student loan payment around to destroy the first few years of your post-school life.
Imagine paying $300 a month for 10 years after you leave college. If instead you invested the money during that time, and then left it alone until age 65, it would be worth $4 million! You are literally throwing away a multimillion-dollar fortune by getting a loan for school!
Sit down tonight and brainstorm some ideas that you can do to reduce the cost of the school you're attending. Get a job as a resident assistant. Apply for scholarships. Look at places near campus where you can work. A little thought and a lot of effort can positively affect the rest of your financial life.
For more info on how to get through college debt free, check out Zac Bissonnette at
Debt Free U
scott@4wallscoaching.com
