Problems with college loans

Good friend Jim posted an interesting bit about a young man who managed to trap not only himself, his wife, and his children in a morass of student loan debt, but also his mother.  Or....maybe not.  When I looked at the article, I decided to get a bit curious and see what I could learn.

The first thing I noticed is that the man's problem isn't primarily student loans, but rather medical costs.  For whatever reason, some serious medical issues for his sons have made it impossible for him to pay off student loans.  So I Googled his name and found his LinkedIn account.

What did I find?  Well, he'd apparently gone to a private school in Pittsburgh that, with an 80% acceptance rate, can really only be described as "less selective" in terms of choosing students--US News characterizes them as "selective", but most schools worth attending qualify as  "more selective", "very selective" and such.  In US News-speak, "un-selective" more or less means the college takes anyone with a pulse, much like car loans.  He's got a "sports business" degree, took out $88000 in debt to get it, and he's been working as a bank teller and insurance salesman since graduation. 

In other words, he's got six figures of debt (after penalties for late payments) for a degree he's never used in his work.  Moreover, the work that he did obtain probably didn't give him stellar medical benefits--this may explain the medical bills he's got.

One of the most interesting things I noted is that if my estimate of his college costs is correct, his loan amount equals tuition, fees, and room & board for four years.  Translated; he doesn't seem to have tried to work his way through college.   I know from experience that he could at least have covered most of his room & board by working just 20 hours per week--40-50 hours per week in the 15 weeks of summer and about 10 hours per week while taking classes.  Combine this with going to a state school--there are nine near Pittsburgh--and he could have graduated without debt.

What this means?  Well, not that we need to forgive student loans.  It means that this young man made just about every mistake in the book financially--he did not work during college, took out huge amounts of debt, and got a worthless degree in the process.  For the rest of us, it means that we need to pay attention to Ben Carson's most recent column and stop graduating financial illiterates.

Or, put a little less politely, when the STEM kids are making fun of your major, it's probably a bad idea to go deeply in debt to get your degree.