When I graduated from high school I was determined to be good with my money, to avoid unnecessary debt. I was NOT going to get a credit card and planned to work to get myself through college. Unfortunately I graduated from college 5 years later with about $45,000 of student loans and 6,000. It wasn’t a pretty sight. Here’s what I wish I had known back then that could have saved me a lot of heartache.
Go to a Community College
I went to a major university and really enjoyed my experience, but I can’t count the number of times I really wish I would have gone to a smaller university or community college. I wasn’t super worried while I was in school. I mean, I was getting a degree from a very good university in a good field. Sure I was in debt and that was a bit scary, but I consoled myself with the idea that I would soon be out of school and I could start paying it back. It was after I graduated that I realized how many people take a very long time to pay off student loans. My situation was compounded by the fact that I struggled for four years after graduating to find anything more than a minimum wage job. Of course, there are many who find good jobs straight out of college, but why take the risk and take on the debt ? With the economy as volatile as it tends to be, it should be easy to see there are no guarantees. The years that followed my graduation from college were among the most stressful I have lived through. I spent the next decade and a half paying for that college experience. Lesson, you can choose to go to a major university and accumulate a lot of student debt, but the price will likely be much larger than you bargained for.
Working through school makes a lot less work later.
When I was in school I really just wanted to be done as fast as possible. I was also determined to have a social life. Looking back, I am not sure what the rush was. There was nothing that said I could not have taken a couple more semesters to graduate. I never worked when I was going to school except in the summers. I was busy with my classes and socializing, but I can’t help wondering how drastically different things would have been if I would have taken a few less classes and gone to a few less social gatherings. Don’t get me wrong. Getting through school and socializing are still very important to me. I am thankful for my degree and the fun times I had at social events, but I also believe that things need to be done in wisdom and order. If I would have taken just a little longer to graduate, I could still have gotten my degree, had fun social experiences, and also done so without debt and the stress and pain that came later. Lesson: take it slow.
Applying for credit cards makes you very vulnerable.
Ok. hear me out, it may seem like harmless stuff, but the act of obtaining a credit card opens up a can of worms that you may not be able to see until it’s way too late. I think my dad tried to warn me not to apply for credit cards, but I thought I could handle it. To be honest I think I wanted the hat they were giving away, the hat I never really wore by the way, so I applied. I thought I could apply and never use them. Well, I was wrong, way wrong and the price was pretty heavy. Even though I didn’t use my card for a few years, I made a rookie error and ultimately got scammed by a company for agreeing to let them send me an “information packet” when the only thing I really got was a bill for $500; all from a card that I never even used. Ouch. It’s tough to admit and to think about all these years later, but to be honest if that was the end of the story I would have considered myself blessed and pretty happy. A few years into my college career I had no money and no loans. I already had the credit card and so I rationalized and took the next step. I used my credit card and even applied for another card to cover my expenses. Thousands and thousands of dollars and 15 years later I finally paid off my credit card. Yep, that hat, that FREE hat, was hands down the most expensive piece of clothing I have ever owned. The lesson, if you don’t apply for credit cards, you won’t ever have credit card debt, EVER.
Eating out can put you in debt fast.
Once I opened myself to using my credit card, I used it. Eating out with my credit card is easily the one thing that was most costly. Yes, I put thousands of dollars on my card for school and such, but eating out was a habit that continually put money on my card, over and over and over. It was also a difficult habit that I had to break in order to get out of debt. There are lots of things we can shop for and overspend on, but eating is something we all have to do daily and if we are in the habit of eating out, it can be a little thing that adds up quickly. I am all for eating out when it is in the budget, but when it’s not it should be avoided at all cost. Dave Ramsey, the popular financial advisor, will tell you restaurants must be avoided when you are trying to get out of debt. If I would have understood that sooner I would have avoided a lot of debt and a lot of interest. The lesson: restaurant meals need to be paid for in cash.
The Wrap Up
I did eventually get out of debt, but it took a lot of stress, hard work and living on very little for 15 years to do so. I am no expert, but if I can help even one person from suffering like I did because they learn from my mistakes it will be worth telling my story.