Thursday, January 26, 2006

College Loans Eating Up Salaries

I came across this interesting article about how many people graduating college are doing so in such debt that the debt is eating up a significant portion of their salaries. It's just another reason to start early and save. if I can come out of college debt free I feel that I will be in a wonderful financail position. From the article:

John Donald and Teresa Bujacich, both health care professionals, don't consider themselves poor, and they wouldn't meet anyone's objective measure of being poor.

Yet they share many of the same challenges as other working poor in the Seattle area. They watchdog their budget, juggle bill payments and live month-to-month. There is no money to save for retirement. No emergency fund. They've made a lifestyle choice not to buy cell phones and cable TV, but even if they wanted to, they could barely afford them. Mini-mansions have popped up like mushrooms in the area surrounding their practice, but they are raising their baby in a modest one-bedroom condominium in Bothell, a 30-minute drive from their work.

The reason? Student-loan debt.

Between the two, Donald, an acupuncturist, and Bujacich, who is both a naturopath and acupuncturist, have 16 years of higher education and nearly $350,000 in student loans, a massive liability that costs them $1,700 a month in loan payments.

Entire Article


Will Kirby said...

I'm in school right now and while i'm nowhere near 350k, the prospect of ending law school with 75-80k in debt just scares me to death. At least, this helps me get some perspective, but it does make me wish I had been a little more aggressive in my saving.

My Boaz's Ruth said...

Interesting. Living in the same area, my husband managed to graduate with no debt at all and I never built up that much (and mine is all paid off 10 years later) I have to wonder if part of the problem is decisions people are making IN college. It's hard to see how one gets THAT far into debt just on tuition and books.

mbhunter said...

If you have posts about debt reduction, like this one, you can submit them to the weekly Carnival of Debt Reduction and draw traffic to your blog.

Your child's adorable! Keep up the good work!