When I was young and unschooled about money, I borrowed thousands of dollars to attend Northwestern University. As I recall, tuition was around $12,000 a year in 1980, and I had only $3,000 to my name. How could I pay?
The dean sent me a letter explaining that the college would lend me the money for my master’s degree in journalism. It would also extend me a work-study job, which would help pay for my Spartan off-campus room.
I jumped at the offer and started the four-semester program. Each term, I would walk across campus to sign my name on a couple of long loan sheets. Did I understand what I was doing? Vaguely. What I mostly comprehended was that an exciting year at university seemed practically free to me.
Fortunately, after graduation, I could afford to repay my loans on the paltry income I earned as a cub newspaper reporter. Unwittingly, I had obeyed this rule of thumb: Don’t borrow more than you’ll earn in one year in your chosen field. In my case, I borrowed around $9,000 and earned $13,000 in my first year at The Bradenton Herald.
The great thing about college loans is also the worst thing about them: You don’t have to be financially qualified to borrow money. The federal government guaranteed repayment of my loans, so no attempt was made to determine if I was financially qualified to repay the sum involved.
Written By: Greg Spears
Published By: www.humbledollar.com