The Consequences of Student Loans

About a month ago I came across an article online titled This is Why Millennials Will Never Grow Up. At first glance, I thought it was going to be some dumb article where the author makes fun of millennials for living in their parents’ basements, or something along those lines. However, as I read the article I found that my presumption was quite wrong. The author highlights a real problem facing people of my generation.

Here’s the article if you would like to give it a read: http://www.marketwatch.com/story/this-is-why-millennials-will-never-grow-up-2015-08-05.

If you don’t want to read the article, let me give you a summary, or as us millennials say, a TL:DR – high student loan debt is forcing many millennials to delay important life events, such as marriage, having kids, buying a home, or buying a car.

Student loan debt is something that has been on my mind a lot. About a year ago, Tom Smith and I were working on a blog that would be about the problem of student loans. The blog got stuck in the proofreading stage, and never came to be. Following the old saying “better late than never,” I decided to rehash some of what we had written and present it in this blog post.

It’s an opportune time to talk about student loans. School is back in session, and on college campuses worldwide, millions of new students are eagerly starting their college career. Many of them will graduate four, five, or six years later, proudly showing off their hard-earned degrees. Unfortunately, many of them will also graduate with a crippling student debt that will continue to have an impact on them years down the line. 79% of graduates in 2013 had student debt. That’s nearly 4 out of every 5 people. The average debt among those 4 was $30,996. Since most of the people reading this are Ohioans, let me bring these numbers a little closer to home. In 2013, 76% of graduates from Kent State University graduated with some sort of student loan debt. The average amount of debt among those graduates was $31,543. The University of Akron, the other Xenos college of choice, clocked in a bit better, with only 72% of graduates having student loan debt and the average amount being only $23,791.

Imagine graduating college, ready to start your adult life, and already being weighed down by $30,000 in debt. Research has shown that for someone with a bachelor’s degree, it will take them 21 years to pay back their loans. Are you okay with losing a part of your income each month for 21 years because of your student loans? What would you have to sacrifice because of these payments? According to the article I started this blog off with, many millennials have had to sacrifice buying a car, buying a home, getting married, or having children because of their loans. Do you really want to be in a similar situation?

Now, I think we can all agree that student loans are bad from a financial standpoint. But I want to go a bit further and bring a spiritual aspect into the conversation. The Bible teaches that the world is under the control of the evil one (1 John 5:19), and Satan has set up an elaborate system to trap and enslave people, known as the “kosmos.” 1 Peter 5:8 says that Satan “…prowls around like a roaring lion, seeking someone to devour.”

Am I saying that student loans are satanic? No… but it definitely fits in his system. Isn’t the following what has happened to a generation of young people?

If you want to get a good job, you need to go to college!

In order to pay for college, you need to take out all these loans!

Now that you’ve graduated, you need to get a job so you can pay back your loans!

Does anyone see anything wrong with this situation? Take out loans to go to college, so you can get a good job so you can pay back the loans you took out to go to college in the first place!

Now, I am probably oversimplifying things and being a bit too harsh. Student loans can give people the opportunity to go to college who couldn’t otherwise afford it. They can be an investment in the future – you are taking out a loan now so that you can have a higher income later on in life.

But we need to understand that there are some serious consequences to carrying a large student loan debt. Going back to the original article I cited, one might have to delay important events in their life because they can’t afford it due to their debt. The events cited in the article were all important ones, but let’s take it a step farther. What if you were given the opportunity to go into the missions field, but had to turn it down because you were saddled with too much student debt? What if you wanted to go to seminary but couldn’t afford it with the monthly payments you were making towards your loans? Or, what if you wanted to be a part of a church plant in another city, but couldn’t risk the chance of not getting a new job right away because of your loan payments?

One could say “if God really wanted me to do these things, he can make it happen despite my student loans.” I do believe that is true for some situations, where God will take care of things so that you may take up these opportunities. However, we are called to be good stewards of our money, and it seems unreasonable to make poor financial decisions with the assumption that God will take care of everything later on. Wouldn’t that be kind of similar to saying “I won’t prepare for this teaching, because if I just rely on the Lord everything will work out?”
I’m not saying that student loans are inherently wrong, but that they can become not only a financial problem, but a spiritual problem as well, preventing us from taking part in some awesome opportunities made available to us.

One thing I have noticed in talking to people is that many don’t really seem to understand their loans, and what taking out student loans entails later on in life. It can be tough to look at the whole picture when the consequences of student loans won’t come into play until years down the line. I encourage everyone to think practically and seriously about this topic. I would hate to see someone miss out on an opportunity like mentioned above because of their debt.

Over the next couple of days, I will be releasing a few other blogs about student loans. The first will be more technical, giving a breakdown of how student loans actually work. It may be a tad boring, but doesn’t the saying go “know your adversary!” After that will come a post with practical advice on how to avoid loans, or how to minimize their impact if you already have them. I hope you will come back to read the other posts, and that you take this information to heart.

In the meantime, if you would like some further reading on student loans, here are some things you might find interesting:

http://www.forbes.com/sites/maggiemcgrath/2015/09/09/desperate-and-in-debt-30-of-millennials-would-sell-an-organ-to-get-rid-of-student-loans/. 30% of Millennials would sell an organ to get rid of their student debt!

http://www.neoblogs.org/tsmith/student-loans/. Here is a post Tom made about his student loans. It gives a more personal look into the subject, and he also shares some practical tips that helped him. FYI, Tom tweeted a couple weeks ago that he had finished paying off his student loans!

http://studentdebtcrisis.org. Just judging by the name of this site, you know it’s gonna be good! Keep yourself up late at night by reading the horror stories submitted by people about their student debt.

http://www.fastweb.com/financial-aid/articles/the-horrors-of-defaulting-on-education-debt. Some more horror stories, this time of people who couldn’t afford their loan payments and had to default on the debt.

3 thoughts on “The Consequences of Student Loans

  1. I am very glad you are doing this Scott. It is so important people confront debt and money issues head on. I have had too many sleepless night worried about money.

    Our generation is great in many ways but we are grossly immature and naive in when it comes to finance.

  2. Great blog, Scott! I have a pretty general idea about my student debt. My dad helped me to consolidate my loans, so at least I’m paying off one lump sum amount. I have spent the past several years living on very little bank, mostly paycheck to paycheck. Now with a new job after college, I’m teetering on the edge of saving, but I have student debt and car debt. Thanks for writing this article. I hope once Megan and I are married, we can approach our finances with the Lord’s kingdom in mind and work to free ourselves from the chains of our student debts. I look forward to your future blogs!

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