Going to college the right decision? Yes if you stay modest with loans and set intentional goals to pay them off
College tuition has doubled since I attended school in the early 2010s. One of the largest hurdles that millennials struggle with financially today is student loan debt. Parents in the previous generation blindly encourage their children to attend universities because in their generation, that's what worked for them and people who attended university have traditionally done well. This is because colleges were more affordable back then, and with an abundant amount of stable jobs that people often held for their entire career, and retiring with a pension or sizable nest egg, it was the best bet to achieving middle-income class.
"you have to be intentional with your decisions and plans and strategize effectively in order to maximize your degree"
However, with an exorbitant increase in tuition costs and an ample amount of creative career path that oftentimes does not require a traditional four-year degree, it is no longer a one-fit solution for all. I still think a college degree is the best bet for having a lucrative career, but I think you have to be intentional with your decisions and plan and strategize effectively in order to maximize your degree while minimizing student loan debt that will cripple your financial life.
Similar to the budget process where you maximize your income and minimize your cost to have the highest benefit. The same formula should be applied here: you should maximize the earnings potential (income), and minimize your expense (student loan).
I utilized several ways to minimize my tuition such as joining the ROTC for two years of free tuition and living in off-campus housing instead of the dormitory.
But the biggest factor in paying off my student loan was finding a job that paid a modest salary while keeping my living expenses lower in order to use the disposable income to pay it off.
It took several years after graduating to realize that the money that I borrowed as an 18-year-old will not magically disappear under my name, and the longer I waited, the more I would have to pay back. When I first signed the loan agreement, I had no concept of what this really meant and how difficult it would be to earn enough to pay back the student loans. I didn't realize that for most people, your first job out of college isn't going to make you rich beyond your imagination.
"the biggest factor in paying off my student loan was finding a job that paid a modest salary while keeping my living expenses low"
Growing up without having to work part-time jobs, and learning the value of each and every dollar, it was hard to imagine how high of a financial mountain it would be to climb. The loan repayment meant that much fewer tangible goods I can buy at the grocery store even the ramen noodle, go out to eat, or travel. It was a scary realization.
After that moment, my first and foremost goal was to get rid of the debt. As mentioned earlier, I maximized my disposable income and reduced my living expenses, and tackled the debt diligently each month. It still took me two years of humble living but I was glad to be done and reach this milestone. It was definitely a relief and felt I can finally just begin to start living my life.
Student loan and college tuition is no longer something you can take lightly.
With the recent sky-rocketed prices, student loan problems are getting worse and worse. Even a strategy of making enough income to tackle the debt seem out of reach for new graduates as wages have not kept up with the rising tuition costs.
That made me realize I should try to assist and subsidize my children's education as much as I could by starting a 529 account even if the amount won't be enough to cover all of their needs. (read: Setting up a 529 Plan). I hope with the compound growth for the next 18 years, it will be a sizeable account to help lift the burden off of their tuition.
In conclusion, I am a supporter of secondary education and believe the value of education goes a long way. There are ample amount of jobs out there that will earn you a good income to pay back your student loans. But you need to be more diligent and intentional than ever before. And for now, I can do my part to build and grow my children's college fund slowly to help as much as I could.
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