A Frugal Education

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I am a rare specimen; I am a person that graduated from college without receiving financial assistance from my parents and without taking out student loans. When my classmates were taking out loans to afford on-campus housing and meal plans, I was living in the sketchier area of town, wearing thrift-store clothing, and getting creative about locating free food on campus. I attended Cornell University, where my frugality was outside the norm. Most of my classmates were either from the upper middle class or the wealthy 1% and lacked the perspective of growing up without money.

Even the students that didnt have the money to cover their costs had no compunction about taking out loans to finance their lifestyle. One of my friends, the daughter of a professor, was attending college for free as part of her fathers tuition benefit. Even so, she graduated with more than $40,000 in loans; she didnt want to live at home, her father didnt want to pay for housing, and she spent her summers studying abroad instead of working. When she told me about her loan situation, I stared at her in shock. I couldnt fathom spending money you didnt have and taking out loans you didnt need. But this friend of mine was hardly outside the norm; I met many students who admitted that they didnt mind taking out extra loans, if these loans ensured they had a fun college experience. Avoid unnecessary debt was a mantra drummed into me from both my parents and my religious up-bringing.

I was very lucky; I was accepted to a university with the financial resources to provide a generous aid package. Since my parents didnt have a lot of money, my tuition was covered by grants. Living costs were harder to cover; I had to work during the school year and during the summer. I also had to take a couple semesters off to work as a full-time lab technician. There were a lot of times, especially towards the end of the school year, when my bank account was hovering around $0. I ate a lot of pasta and eggs, to the point that one of my roommates instituted a ban on eggs in the house out of concern for my health.

Sometimes I regret not having a more laid-back student experience. I missed out on some valuable college experiences because I was always either working or studying. But I was raised by parents that taught me to be frugal and to live within my means. My parents are examples of hard-working people that fought their hardest to keep their heads above water, all while raising a large family on a very limited income. Sometimes my parents had to get creative; for years, my parents raised cows, chickens, and pigs in order to feed the family. And there were times when my parents had to rely on public assistance and church welfare. But my parents never gave up. No matter how dire the situation got, there was always the self-assurance that we were doing everything we could to make ends meet.

I am grateful to my parents for the lessons they have taught me. Now, post-college, my husband and I are free of student loans, free of credit card debt, and we were able to afford a 20% down payment on our home. I also had the privilege of studying at a wonderful university, one that taught me how to question and to think critically. My college experience was one that I treasure, as my education taught me to push intellectual boundaries. There were times when I had to struggle to make ends meet but in the end, I discovered my own strength and resourcefulness.

Thank you, Mom and Dad, for teaching me to always live within my means.

 

Note: This was originally posted on “A Post-Mormon Life”

32 thoughts on “A Frugal Education

  1. More people need to do what you did. A sincere congratulations to you and your husband.

    I read somewhere when prepping for law school:

    “You can either live like a lawyer in law school and then live like a student after graduation, or you can live like a student in law school and then live like a lawyer after graduation – take your pick.”

    Of course, law degrees are such a bad investment these days that I’m not sure that’s true in all respects, but the basic concept seems sound.

  2. I’ve never heard that saying before but it is a pretty sound concept. I went to grad school at a medical college, where a lot of the med students took out massive loans assuming they were going to be wealthy doctors. Which, if you get through, you probably will make a decent salary, however, the amount of loans to pay back would be pretty staggering. And if anything happens, you’re screwed.

  3. My dad is a doctor on the Wasatch Front, and he said that a lot of the doctor families we knew living in mini-mansions up on the foothills were in debt up to their ears. Just because they fell into the trap of thinking that their profession entitled them to something.

    But that aside – as a bankruptcy attorney, I’ve slowly been coming to the conclusion that student debt is some of the most toxic and dangerous debt in America right now. That stuff is nasty. You can’t get rid of it in bankruptcy, the amounts are astronomical, the risk is getting higher and higher, and they can even exercise enforcement options you usually only see from the IRS or State Child Support services – like garnishing Social Security.

    I swear, if my daughter comes to me 8 years from now and announces she want’s to get an degree in Chinese literature I’m gonna….

    ahem.

    Smile and politely tell her to pay for it herself. Yeah, that’s it…

  4. When my daughters started college, they met with financial aid “advisers” (these are official people working in the school’s financial aid office, mind you), who told them they should each take out $11,000 in loans per year. They knew better than to take that advice (They didn’t need my “That’s insane!” to keep them from doing it), but when it’s coming straight from the school, I fear a lot of people won’t think twice about it until it’s too late.

    I think a student loan amnesty is probably a bit too extreme, but making it dischargeable in bankruptcy would go a long way towards helping a lot of people.

  5. Kuri: There was a semester when I was really struggling to make ends meet. I went into the student aid office to investigate taking out a loan to tide me over to the end of the semester. The aid officer told me about the government grants (I think each student is entitled to take out a certain amount in loans each year and the gov’t subsidizes some of the interest) She was quite shocked when I said no, I didn’t need the full amount, all I needed was $800. Which I then paid off over the summer. I really do think that financial aid offices need to counsel students a lot more as to the consequences of student loans.

    Seth R: Based on what I’ve seen, I’m not surprised that a lot of doctors are in debt up to their eyeballs. I get the feeling that a lot of my husband’s co-workers (he’s a research engineer) are either in debt or have no savings whatsoever – their lifestyle is a lot more lavish than ours. And yeah, if I have a kid who wants to study something like Chinese literature, I will do my best to make sure they make that decision with their eyes open. I’m not saying it won’t work – it can – but you have to be very pragmatic and willing to put in the sweat necessary to make your dream a reality.

  6. Yeah, my daughters have done the same thing. They’ve gotten loans for amounts like $1,500 and $2,000, and they’re always met with surprise that they don’t want everything they’re eligible for.

  7. Kuri, the 2005 bankruptcy reform law (we bankruptcy attorneys abbreviated it “BARF”) made private student loans very difficult to get rid of. Getting a student loan discharged (which includes anything from a Stafford loan at Notre Dame to a hairstyling degree from those folks advertising a 3 AM on the Sci Fi channel) is almost impossible in Bankruptcy Court. There is a “hardship” exemption, but it’s draconian. We debtors’ attorneys call it the “iron lung exemption” because you basically have to be in an iron lung for the rest of your life to qualify.

    The only option for people with hardship is to search their private student loan lender’s website for information on getting hardship workouts or assistance on the good graces of the lender (and they don’t make these programs easy to find on their website – you really have to dig for it).

    But…

    On the other hand… can you imagine the greater financial implications if they opened the floodgates on private student loan discharges?

    It would probably be the biggest financial crisis since the mortgage crisis.

    I’d settle for making student loan payments an allowed income deduction in Chapter 13 5 year payment plans. They currently aren’t allowed as deductions and it causes my clients a LOT of hardship problems.

  8. It was already next to impossible to discharge government student loans before 2005, as I can tell you from personal experience.

    Obviously the general forgiveness some people have been talking about would have huge effects (not necessarily all bad, though, except to banks and servicers), but I wonder how large the negative impact would be just from making student loans dischargeable. Not that many people would declare bankruptcy, I would think.

  9. I think the student loan industry targets a very vulnerable population – kids who need to go to school, who have easy access to a lot of credit, and who just don’t have the maturity to understand the consequences of their actions. In a way, it’s probably even worse than the mortgage crisis, given that you can’t get rid of student loans and no one even makes an effort to ensure that students will have the capacity to pay off the loans in the long-term.

  10. If a seventeen year old kid walked into a Wells Fargo branch and wanted to borrow 200K for purchasing a small house, he’d get laughed out of the building.

    But no one even thinks twice about dropping the same amount on him for going to Georgetown.

    It’s nuts.

  11. It is nuts. But on the flip side, my husband did his undergraduate in India. At the time, you couldn’t even get loans for college, no matter how desperate your circumstances. If he hadn’t had the very good fortune to get a scholarship (which was also very rare) he wouldn’t have been able to afford college. And he is a freakishly talented individual, it would have been a real tragedy if he hadn’t gone to college.

  12. I know it’s crazy, but my experience is that because I didn’t take out the loans and didn’t go to university until I could afford to go back and fund it myself, I missed out on the potential of making far more money overall than had I bitten the bullet and taken out the loans in the first place. I am fully aware that a university degree does not guarantee a person a job or a good income, but I think it would have been better for me to finish my degree and have more options at the end of it than to put it off for another fifteen years, working minimum wage jobs.

    I agree with postmormongirl that unnecessary debt is never a good idea. It’s difficult to drum that into a young person’s head, no matter what values their parents have drummed into their noggins. I just wished I had had someone who could have explained to me my potential earnings stacked up against the short-term debt. I doubt that I had the discipline or the brain-power to attend Cornell when I was eighteen, but I think that even at a state school I would have done better to take out a few loans, live frugally and graduate with a practical degree. Seth, I wonder if a degree in Chinese anything, these days, might be looked upon as a good investment? I am getting ready to start a Mandarin course with the view of passing on as much knowledge to my boy.

  13. Seth, I wonder if a degree in Chinese anything, these days, might be looked upon as a good investment?

    lol, I was thinking the same thing, actually…

  14. leftofcentre: You know, I did take a couple semesters off but overall, I would recommend going straight through college. In my situation, I took some semesters off for different reasons – the first semester I was in the middle of changing majors and wanted time to think. The second semester I was in a long-distance relationship with my husband (I met him six months before he graduated) and was able to get an internship where he was doing his post-doc. But overall, I do think it’s better to just bite the bullet and take out some loans if that means getting out in a timely fashion.

  15. @13 — That is a very interesting article. I agree with a lot of the author’s points about how university credentials are often more a class marker than an indication of merit (for the reasons the author describes, particularly w.r.t. le over-valued ivies). However, the author seems to be implying that the solution is to do away with the university system. There are a few problems with this:

    1. Even if credentials can be a zero sum game, there is no reason for education and information to be a zero sum game. The democratic solution isn’t to say “everyone should be ignorant” — it’s that everyone should have access to a decent education. And not just for the sake of having credentials. Curiosity, knowledge, and learning are valuable for their own sake. Widespread education is critical for a democracy or republic to function.

    Some can learn on their own without teachers, but leaving people to learn on their own initiative gives a big unearned advantage to people with means. K-12 public education could be dramatically improved. A lot of things people learn these days in expensive universities could be learned at the high school level if investment in the future (trhough education) were a priority (instead of being treated like some sort of unearned “entitlement”). A lot of Americans have essentially decided that public education, on principle, cannot work, therefore should be defunded and scrapped. The ones who think this are the ones who are incapable of seeing beyond their own borders.

    2. Suppose, hypothetically, we were living on a planet where we need massive amounts of scientific research and engineering to develop feasible/economical alternative energy technologies now (as in, like, preferably 20 years ago, but, failing that, ASAP) if we’d like for our planet to be fit for human habitation at the end of this century. How does the author propose the scientists and engineers should be trained? Where will the research labs be? What if someone wants to be a scientist out of a passion for learning? Is that some sort of elitist dream that needs to be squashed, out of fairness?

    3. After reading the beginning chunk, the first thing that popped into my mind is a point someone mentioned to me a while ago, about American medical schools. Specifically, one of the reasons why health care is so much more expensive in the US than in other countries is because US medical schools require a bachelor’s degree before even beginning medical school. So doctors are scarcer, and have a ton of debt to pay off, and are hence more expensive. But the US system isn’t typical. Still we read:

    Today, we take it for granted that practicing medicine or law requires years of costly credentialing in unrelated fields.

    Who’s “we” in this sentence? Seriously, are the US borders walled by a giant two-way mirror, shiny-side in?

  16. @13 I feel a little uncomfortable with the fact that all of the SCOTUS are educated at either Harvard or Yale. But in some respects, I think that is more a indicator of the fact that each year, law schools graduate about twice the number of students than there are positions for, making competition extremely fierce and prospective employers lazy about finding good candidates from lower-ranked universities.

    I do realize that getting into an Ivy League was due to both hard work and luck. I have met a lot of brilliant students that didn’t get the same opportunity through no fault of their own. And I always try and keep that in mind. But that said, I absolutely treasured my years at Cornell – my education pushed my boundaries in ways I never dreamed possible. I am one of those starry-eyed idealists when it comes to education. I love learning, love pushing my boundaries in terms of what I can do intellectually. Cornell was the first place I truly felt at home, especially in light of my up-bringing – a lot of my Mormon girl peers seemed intent on hiding/down-playing their intellect, which made me flat-out miserable.

  17. I am one of those starry-eyed idealists when it comes to education. I love learning, love pushing my boundaries in terms of what I can do intellectually. Cornell was the first place I truly felt at home, especially in light of my up-bringing a lot of my Mormon girl peers seemed intent on hiding/down-playing their intellect, which made me flat-out miserable.

    That’s excellent. Actually, I think the main problem with the article linked @13 is that the author is totally dismissive of the possibility that a university education/experience might have value as anything other than as a credential.

  18. @19 – Very true. And I did meet a fair number of students for whom education only seemed to be a credential that they needed in order to get to whatever goal in life they had, rather than an opportunity to learn. But if you were someone who loved learning, there were some amazing opportunities. (I was a bit of a professor’s pet, although not in a bad way – I just really liked talking to them about the lectures and they seemed happy that I was so interested. Plus they knew me because I was also spent a lot of time in lab and they knew my boss.)

  19. Personally, I have a PhD in Mathematics (from a big state school that is highly ranked in math: Rutgers), and I got it without going into debt. I actually had some savings when I graduated.

    For undergraduate school, I had a full-tuition scholarship, plus my parents subsidized my living expenses. (I intentionally lived more frugally than necessary, eating the cheapest food possible, etc. When I told my mom that I was saving X amount every month, I thought she’d be so proud of me, but instead she was annoyed that I was allowing her to pay me more than I needed, lol.) Then, for grad school, I supported myself on a fellowship and then a teaching assistantship.

    I don’t want to pat myself on the back for not going into debt, though, because I know I had plenty of opportunities that other people didn’t have. I’d rather see those opportunities spread around. Supporting students in India (@12) is an excellent way of giving back to society.

    My current field (software engineering) is one where a talented person can have a successful career, even without a degree. At the same time, I’m very glad that I had the opportunity to do research-level Mathematics. Even though I don’t use the specifics of the math I learned, that experience has been incredibly valuable to me throughout my life in terms of learning how to learn. In my career experience, I think it’s great to have a team that includes people with traditional CS/engineering degrees working alongside people like me (somewhat non-traditional degree for the field) along with people who are self-taught. Each bring different perspectives.

    So, I guess I’d say that that article raises some interesting discussion questions, but perhaps its conclusions miss the boat…

  20. Good for you postmormongirl!

    I think any discussion about loans and education should also include the increasing cost of higher education (which is greater than inflation). Why is that?

    I wonder if schools could give students a good estimate of what they would be paying in tuition/loans each year for the four years (if it takes four years). I think it would be good prior to a decision of where they would attend. I don’t know that I would have attended another school, but it would have been nice to know the difference between my school of choice and the public state university. With that said, I don’t regret taking out student loans and paying them off, personally.

    These are difficult questions, and I appreciate this discussion. I wish there were more discussion in various communities about higher education. A degree is no longer a ticket to the middle (or upper) class, as it might have been at one point. But it’s still useful for our society. So how much do we encourage, what limitations do we put on who can attend, what they pay? The article was interesting.

  21. “Our elaborate, expensive system of higher education is first and foremost a system of stratification, and only secondly??and very dimly??a system for imparting knowledge.” The authors of Death by Degrees may overstate the intentional stratification function of college, and understate intentional imparting knowledge function, but for a long time now there are those who have argued that college education has been over sold. It was a common refrain of high school graduation speakers to point out that the earning capacity of college graduates was so much greater than non-graduates, with little said about the liberating value of knowledge, regardless of your income. My impression is that those who chose the trade school route (by whatever its name) were considered inferior to the college bound, even though it was argued that college was for many nothing more than a glorified trade school, or union-card acquisition program.

    My reading of the article was that the authors were arguing that the elite use colleges as a way of protecting the same. And we have bought into it too such a degree that we will go a trillion dollars into dept to join the society. I thought they were saying it doesn’t have to be that way, that, in fact, a quality education can be provided at a far lower cost economically and socially.

  22. My brother-in-laws who went to tech schools in computer programming are making more per year than a large percentage of my graduating law school class.

    Can’t speak to every subject, but I KNOW law school has been oversold.

  23. @23: Nowadays, trade school skills are become rarer and more valuable. I remember watching a video clip by the Dirty Jobs guy (Mike Rowe?) in which he was talking about how there are acute shortages in skilled trades such as plumbing and electrical work.

    @24 I have seen some pretty harsh cases of people graduating from law school and not being able to find a job. It’s a tough situation.

  24. My reading of the article was that the authors were arguing that the elite use colleges as a way of protecting the same. And we have bought into it too such a degree that we will go a trillion dollars into dept to join the society. I thought they were saying it doesnt have to be that way, that, in fact, a quality education can be provided at a far lower cost economically and socially.

    That’s the aspect of the article I agree with. However, there was far too little in the article about the value of learning and knowledge, and about how we could get that value without it being a class-stratification system.

    To sneeringly call people “elite” for knowing that the word has an accent aigu in French? That’s just sad. Speaking a foreign language is valuable in our modern world! The complaint should be that this skill isn’t made more accessible — it could so easily be made more accessible! Dissing people as “elite” for speaking French smacks of being suspicious of the knowledge and learning itself rather than the unfair distribution of that knowledge.

    The article would have been greatly improved with some real examples of how things are done differently in other countries. Trade schools and apprenticeships? They’re very popular in Europe — notably in Switzerland they’re a common alternative to university-track high school. What are the pros and cons we observe? Wouldn’t it be interesting to know?

    Personally, I think the US educational system does some stuff better than other countries and some stuff worse. But from the article, you wouldn’t even know other countries exist. The author’s lack of curiosity, unfortunately, makes the article look like a complaint that it’s unfair to treat knowledge as valuable.

  25. I thought the authors were sneering at the NYT’s sneering at T. Clarence sneering at Yale’s elitism. The funny thing is that Clarence benefited greatly from his Yale law school credentials. But to add a bit of sneering of my own, I sometimes wonder to what extent his experience at Yale was educational, or simply schooling.

    But am I a hypocrite? I came out of my PhD program, not owing a cent, having been funded through a fellowship program. And I certainly didn’t bite the hand that fed me, and I have no intentions of burning my diploma, as the authors suggest at one point. I wouldn’t even burn the one I have from BYU–even if I knew exactly where it is (but I’m pretty sure that it is here someplace, and if I searched for it I have a better chance of finding it that than, say, finding a BofM artifact in Central America–said with a straight face, no sneering intended).

    And speaking of BYU, how do we parse its educational function and it s credential bestowing function on males and church leadership positions?

  26. @chanson: You know, I did run into quite a bit of that at Cornell. I took some writing classes. My grammar is pretty shaky, as my public high school’s English department was weak. So a lot of the discussions, the student would fixate on picking apart the grammar, using terms that made my head swim. But when I talked to the professor, she reminded me the substance of the essays were more important, as you could always find a good editor, but you couldn’t fake having good ideas.

  27. An article in the New Yorker last year demonstrated what might be called the class unconsciousness of the credentialed. There Jeffrey Toobin, a graduate of Harvard College and Harvard Law School, profiled the villainous Clarence and Virginia Thomas. Clarence Thomas was born in an impoverished Gullah-speaking community on Georgias Atlantic coast, attended Holy Cross and Yale Law School, and eventually became the second African American to sit on the Supreme Court. Thomass hatred for the Ivy League is legendary; he felt mistreated at Yale and has claimed that he suffered in the job market because firms assumed he was the beneficiary of affirmative action. Thomas likes to rail against lites, a term Toobin smirkingly quarantines in quotation marks, as if the concept to which it referred were a chimera and not a plain reality.

    It would be astonishing enough for the New Yorker to cast doubt in any context on the existence of an lite??even as it insists on the words accent aigu ?but it is especially so in the context of the law, where a guild-like structure is more tightly organized around vaporous prestige than in any other field.

    Actually, I read that article. I didn’t get the impression that the New Yorker was pretending like lites don’t exist or that the ivies are some sort of meritocracy.

    Yes, the article was negative, but Thomas’s “railing against lites was not presented as the main problem. It’s petty of the author to suggest that writing for a magazine that has notoriously quirky typographical policies means Toobin has no business putting someone else’s word in quotes.

  28. p.s. If you want argue that the New Yorker symbolizes the lite combination of brains, ivies, and loads of money, you can find a lot better evidence than their pseudo-franglais. Just look at the ten or so pages of ads near the beginning of every issue — they’re largely for expensive watches, jewelry, and “wealth management” services.

    But speaking French shouldn’t be dumped on as litist. My husband (who didn’t come from money) learned English well enough in an ordinary public high school to enjoy reading the New Yorker as a young adult, still living in his homeland (France). So I don’t think it’s helpful to conclude a two paragraph slam on the New Yorker with this:

    When we ask ourselves whether populist hostility should be directed against the rich or against the professional elite, the answer must be, Yes, please!

    The populists should be fighting for everyone’s fair share of good educational opportunities since knowledge itself isn’t a zero-sum game. The problem with the New Yorker isn’t that many of its readers speak French — it’s more that the type of education its readers and writers enjoy should be more fairly distributed and shouldn’t require going 200K into debt.

  29. “Thank you, mom and dad, for teaching me how much better I am than everyone else. I will always treasure this lesson as I look down on the peons beneath me.”

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