The following article is from Melanie, our new staff writer. Melanie is in the beginning phase of her journey to Financial Freedom and she’ll offer a refreshing point of view for us. For instance, I’m investing in the state’s 529 plan to help pay for my kid’s college education, but she has a different take on it. Let’s see what she has to say.
As a Millennial, I am a walking statistic. I carry a large student loan balance that will take me years to pay back. I chose to pursue higher education, as I thought it was the right thing to do, the appropriate next step after immersing myself in the working world.
When all is said and done, I will have paid over $81,000 in student loan debt. Much of my generation is saddled with student loans, and the news doesn’t make it any better. Every day we see tuition rising, more young people burdened by large student loans looming over their heads, and the post graduate job market continues to be dismal for many. Currently, I have paid off $40,000 of my $81,000 balance. About $30,000 of that was paid off in the past three years after I got serious about getting out of debt. During this time, I faced bouts of unemployment and seasonal work, making between $16k-30k. It has not been an easy road, but I’m determined to get out of debt.
Some days, I dream of what it would be like to be debt free. By my standards, I’d be rich, much more carefree, and able to fulfill some of my dreams that are currently on hold. However, as I began whittling down my debt, I started to realize how much I have grown as a person and am appreciating my journey. And I’ve realized that I wouldn’t change a thing.
Here is why I’m glad my parents didn’t pay for my college education:
They Didn’t Compromise Their Retirement
I always knew that getting a college degree was something that I wanted to do, and my parents always emphasized the importance of going to college. My parents also made it pretty clear they were unable to assist me with my college tuition. You better believe I asked for help. They assisted me in the ways they could, but paying for tuition was my responsibility.
When I decided to go to graduate school in 2010, I asked for a help again. The answer was still the same. Although it hurt at the time, I’m glad my parents set boundaries. I’m glad they understood that by paying my tuition, they would be compromising their own dreams of retirement. Although my parents make a good salary, for most of my life they have been a single-income household, with my mother being the breadwinner. To pay for my college would mean compromising their situation. Remember, you can borrow money to go to school, but you can’t borrow money to retire.
I Have A Strong Work Ethic
I have always been a hard worker, but once I realized that no one was going to bail me out of debt, I really kicked it into high gear. For the past several years, I’ve taken on many side hustles as: a pet sitter, house cleaner, brand ambassador, event assistant, and more. I’ve even worked an overnight rave selling water to sweaty dancers… I’ve made between minimum wage and up to $20/hour for these side hustles. There is (almost) nothing I won’t do.
Before, I used to think that I was too good to do certain things, or that I was “above” doing a certain kind of work. Then I realized that work is work. You have to be responsible for your own financial well-being, and sometimes you have to do whatever it takes. It doesn’t mean it will be like that forever. It is temporary, but you have to take the first steps. Being in debt has taught me the value of hard work. It has taught me patience and resilience. Those are qualities you cannot teach; you only learn it from experience. To me, learning those qualities and knowing I can bounce back from hard times is priceless.
I Was Forced to Learn About Finance
When I graduated college, I knew very little about personal finance. I had a vague idea of what a budget was, knew that saving was important, but didn’t really understand how everything worked together. Upon graduation, while dealing with my student loans and having found a low-paying job, I knew I had to get smart quick in order to take care of myself. Although it’s been a journey filled with ups and downs, false starts, and quick turnarounds, I’ve learned a lot. In order to get out of this mess, I was forced to learn about finances. And so I did. I have an emergency fund, started saving for retirement, and put over 50% of my income towards debt. I still have a long way to go, but sometimes you can only take baby steps. I had to learn the hard way, but I learned many lessons – lessons that came gift wrapped in a very complex package.
I’m glad for the journey
Would I be more financially stable, richer, and better off if my parents paid for my college? Probably, but purely from a financial aspect. I am choosing to see the silver lining and appreciate the other areas of my life that I am rich including love, health, experiences and hard work.
If you are thinking about compromising your retirement to help your child, you don’t have to. Do what you can, make your boundaries clear, but realize it’s not all bad news out there.