Dealing with 100K College Debt: Advice & Tips

[konto77]

Hey, so I've been using the financial aid calculators online to see how much the interest will rack up to once I graduate college.

I'm finding that I'll be owing near 100000 dollars for loans that I'll have to take out.

The monthly payment will be about 800 dollars a month.

Has anyone here had to deal with that much debt?

Will it be manageable with an engineering job?

 

[Wax]

That's like paying off a house!

If you have good grades, trying applying for some scholarships.

 

[konto77]

That's like paying off a house!

If you have good grades, trying applying for some scholarships.

I understand that it's a lot, but don't engineers start off with about 60000?

Besides, it's a little late for scholarships now, I'm going to start college this fall. My grades are good, just not good enough. 3.6 pff... sats are only 1860.
I slacked off for the first two years of high school, but got straight A's this final year with 5 AP classes. So i know I'll be able to do well in an engineering major.

Has anyone else dealt with this much debt though? Is it manageable with an engineer's salary?

 

[diazona]

Or go somewhere cheaper edit: I guess it's a little late for that, then

Remember that different colleges have different expectations about how much money you need to cover with loans. So make sure to check with the financial aid department at your university to see what they expect of you, and don't just use some generic loan calculator.

 

[TMFKAN64]

$60K is $5K/month. Overestimate taxes and say you'll be left with $3K/month. Take out $800, you'll be left with $2200 per month to live on.

The big question is, where will you live? Housing prices vary greatly... if you end up somewhere like NYC or the SF Bay area, you'll be hurting... but there are other areas of the country where you'll be just fine. So to a large extent, the real answer depends on what type of engineer you will be and where the jobs are for that field.

Aside from loans though, look for scholarships, work-study, or just plain old summer jobs. Every little bit that you can pay out of your own pocket will reduce your loan payment later on.

 

[konto77]

$60K is $5K/month. Overestimate taxes and say you'll be left with $3K/month. Take out $800, you'll be left with $2200 per month to live on.

The big question is, where will you live? Housing prices vary greatly... if you end up somewhere like NYC or the SF Bay area, you'll be hurting... but there are other areas of the country where you'll be just fine. So to a large extent, the real answer depends on what type of engineer you will be and where the jobs are for that field.

Aside from loans though, look for scholarships, work-study, or just plain old summer jobs. Every little bit that you can pay out of your own pocket will reduce your loan payment later on.

I am going to do work study, and I already have a summer job and will continue to work in the summer. I want to hold on to some of that money though so that I have for any possible downpayments in the future.

But, I don't plan on buying a house until I find someone to marry, which i'd like to do around 28.

So without buying a house, and living strictly within my means, I think I can do this. I don't need to make a ton of money right out of college, I'll make money no matter what, and I think that 100000 of college debt is worth it, for an engineering degree. Am I just too hopeful? Or is it likely that I can do this?

 

[Pengwuino]

From what I hear, that'll certainly be manageable. I've never had to take out a student loan but I hear they commonly get that high and that it's like a house loan - a big number that you simply pay off over a long time.

As for scholarships, WHOA! You are certainly not too late for scholarships. People get scholarships even in graduate school.

 

[cristo]

$100,000 debt after university? Wow!

 

[Andy Resnick]

I'm afraid your situation is already very common for people earning professional degrees, and unfortunately is becoming more common for 'everyone else'.

It's important to carefully think about your decision, given there are no guarantees- what are your reasons for going to university, for example. What other career options are available for you. What sort of financial aid options are available. etc. etc.

 

[TMFKAN64]

I think I can do this. I don't need to make a ton of money right out of college, I'll make money no matter what, and I think that 100000 of college debt is worth it, for an engineering degree. Am I just too hopeful? Or is it likely that I can do this?

I think you can do it too. However, just be sure you do well in school! It would be terrible to have to pay off even half of that *without* an engineering degree...

Good luck!

 

[Nick M]

Two years at a CC - $10,000
Three years at a Your-State U - $40,000

There you go, 50% off and still get a $60k job for EE/ChemE.

 

[TMFKAN64]

Except if "Your State" is California, three years is closer to $75K. :-) (This is their estimate including living costs for UCLA.)

Community college is still a good idea for decreasing costs though.

 

[Locrian]

I understand that it's a lot, but don't engineers start off with about 60000?

No. Engineers don't have a starting salary. A starting engineer's salary could fall anywhere in a distribution that varies on what area of engineering, location, the quality of the applicant, the state of the job market, the field (govt, etc), and more.

Working with your assumptions, it appears to me (rough calculation*) that your debt is going to damage the net present value of your career by 10-13%, depending on how fast your income rises and how long you work. If you make less than your (comlpetely unreliable) estimate of 60k, or have job/health/etc. problems, that will get much worse rapidly.

Still, it's totally doable. In my opinion the bigger problem isn't the 100k in debt; it's that you haven't done enough research into "details" like where you'll be working, what you'll really be paid, what the odds are of getting a job, etc. And the canned speeches from your university department don't count, by the way.

Kudos for coming here and asking. The real answers are going to come through your own hard research. Accepting nothing at face value is the most valuable piece of research I can give you.

* Assumptions included a 60k start; maxing out at 83k after about 12 years; no periods without work; 8% interest on the loan, 4% discount rate on earnings

 

[Choppy]

I would be curious where the $100k number comes from. Lots of students are able to make it through university without any debt at all including those who weren't given a 'free ride' via some scholarship and without a blank cheque from the Bank of Momandad.

 

[Monocles]

Well, Choppy, I can't speak for the OP, but I was going to end up with a similar amount of debt until I took some debt-reducing measures. My situation is that my parents move every couple of years, so I was out-of-state in every state. So getting in-state tuition was out. I decided to just move to where a bunch of my relatives have always lived and go to the best school there. My parents make too much money for me to get any government assistance, but they won't pay for my schooling. I was originally going to end up with over 100k in debt, but I decided to drop the second major and enter into the co-op program, so I work full time every other semester. I also work part-time during my school semesters. Doing this will get me to around 70k in debt, which is still a lot, but I could have avoided if I had gone to a "lesser" school that offers full rides to students with slightly above average SATs (this is what my little sister ended up doing). I was just foolish at the time and wasn't considering what kind of effect so much debt would have on my post-graduation life.

 

[konto77]

Well, Choppy, I can't speak for the OP, but I was going to end up with a similar amount of debt until I took some debt-reducing measures. My situation is that my parents move every couple of years, so I was out-of-state in every state. So getting in-state tuition was out. I decided to just move to where a bunch of my relatives have always lived and go to the best school there. My parents make too much money for me to get any government assistance, but they won't pay for my schooling. I was originally going to end up with over 100k in debt, but I decided to drop the second major and enter into the co-op program, so I work full time every other semester. I also work part-time during my school semesters. Doing this will get me to around 70k in debt, which is still a lot, but I could have avoided if I had gone to a "lesser" school that offers full rides to students with slightly above average SATs (this is what my little sister ended up doing). I was just foolish at the time and wasn't considering what kind of effect so much debt would have on my post-graduation life.

So, Monocles, you have graduated? How have you been faring on your own with that college debt? My problem is that my parents have no money to help me in any way. I'll have to buy my first car on my own and need to start building credit all on my own since they can't help me. Because of this I am fearful as to how I am going to make it on my own. Because of this lack of money I am extremely immobile. (something that's hard to understand unless you've been on both sides of the fence before) Have you been able to handle all this? Or do your parents help you out?

 

[konto77]

Hey, check out this federal student loan thing I just foundout about. http://www.ibrinfo.org/ Maybe this will make my dreams possible :D

 

[Fanaticus]

I would be curious where the $100k number comes from. Lots of students are able to make it through university without any debt at all including those who weren't given a 'free ride' via some scholarship and without a blank cheque from the Bank of Momandad.

I agree. I graduated with 25k of debt, and that was just because I did volunteer research and didnt work much the last two years.

 

[mattbreck]

May I suggest possibly getting a job up in Ft. Macmurray Alberta in the oilsands? The technology available for engineers up there is world class and the money is pretty good. For example truck drivers that haul the sand to the extraction plant make a minimum of 80k US a year. That's about average across the board for all trades. If you don't mind switching careers for a couple of years to get rid of your debt and then you can focus on your engineering career.

 

[Monocles]

So, Monocles, you have graduated? How have you been faring on your own with that college debt? My problem is that my parents have no money to help me in any way. I'll have to buy my first car on my own and need to start building credit all on my own since they can't help me. Because of this I am fearful as to how I am going to make it on my own. Because of this lack of money I am extremely immobile. (something that's hard to understand unless you've been on both sides of the fence before) Have you been able to handle all this? Or do your parents help you out?

Nah, I'm still in school.

 

[bombastic]

If you are facing the prospect of $100k in debt, do look at community college for the first two to four semesters of your college career.

There's no need to pay $25k/yr to learn the basic math/physics requirements you'll need and the smattering of humanities courses you'll probably need to graduate. It takes a little extra work on your part to visit counselors at the CC and whatever university to where you will transfer, but it is worth it in the end.

And while I can't attest to the rigor of these statistics, it has been shown that people who transfer up from a CC in the U.S. usually perform better academically than the rest of their peers.

 

[Canes2552]

If your parents can't help you out, apply for financial aid. You should get some grants along with your loans. I have a buddy who basically gets paid to attend college just based on his financial needs.

also

do look at community college for the first two to four semesters of your college career.

you don't want to pay mad money to take calculus, physics and humanities courses. I am a ME in North Carolina and we have a program with several CC and state schools w/o traditional engineering departments where students take courses from the first 2 years and transfer into NC State to finish their degree.

 

[gravenewworld]

IMO $100,000 worth of debt is absolutely not worth it for an undergraduate degree. I graduated with roughly $50,000 of debt. If I had the option of applying to college again, I would easily take my in state university over the private college I went to. Would the debt be manageable? Probably. But you also have to factor in costs like what could all that money be used for instead after you graduate. I ended up moving back to my parents' house (lame yes), however, I have since climbed over $25,000 out of debt in less than 2 years. At the rate I was paying it off before it would have taken me until something like 2041 and almost $30,000 in interest to pay off all the loans. That $50,000 loan was actually going to turn into an $80,000 loan. Most undergraduate degrees are of the same quality no matter where you go. Many ivy league trained professors teach at state universities. IMO, going to a premium name university only really matters if you are going there for grad school.

 

[madners]

hye there~

100k? sure a lot bro, but then wasnt it depend on ur cgpa?

luckly for me enter government university, only have to paid around 2.5k per semester = 20K for 4 years cost..

but then just strike the path bro...

 

[Moonbear]

How are you calculating $100,000? Is that the actual tuition and fees costs for your 4 year degree (that's expensive!), or is that factoring in the interest on the loan and number of years it'll take to pay it off?

If your family has little money to even help with school, and you're going to have to fend for yourself after college with nobody to help you get started, I'd strongly suggest looking at alternative schools with lower tuition (though if they have so little, I wonder why you're not qualifying for other forms of financial aid...have you filled out your FAFSA paperwork already?)

Definitely continue to apply for scholarships...you aren't likely to pick up anything with a full ride type deal so late, but there are always tons of little scholarships available, and even if they don't cover more than the cost of textbooks, every little bit helps.

Unless you have a really high cap on what you can earn through work study, also consider a part-time job near your college. If you're willing to forego the party life now to save debt later, being willing to work Thursday or Friday evenings at the local grocery store or other 24 hour market will get you hours that a lot of students try to avoid working and bring in some extra money, and then you'll have that job secured for the semester breaks too (you can find something that pays better in the summers).

 

[maverick_starstrider]

Two years at a CC - $10,000
Three years at a Your-State U - $40,000

There you go, 50% off and still get a $60k job for EE/ChemE.

? Either I'm misunderstanding you or you might want to check your math there.

Anywho, $100,000 is obscene I can't believe you guys pay that much. Honestly it you're not looking for an amazingly ambitious job (like top NASA scientist or some such) I'd think switching to a state school or I guess a community college (I don't really know about those).