Debt is a gigantic issue among everyone in our current environment. There is no way to avoid it, but there are ways to minimize the amount of money that we throw away every day. The first thing that comes to mind when anyone says debt is usually “government debt.” However, the focus that I have chosen to take concerns “student loan debt.”
A recent study by the National Center for Education Statistics shows that about 50% of recent college graduate have student loans, with an average student loan debt of $10,000. The average cost of college increases at twice the rate of inflation; the College Board estimates that public schools cost on average, about $13,000 a year, whereas private schools costs $28,000.
There are many ways in which to ease the burden of this debt in small/smart ways that can add up to huge savings in the end, such as scholarships, grants, federal loans, and private student loans. If borrowing is necessary, there are also many ways to reduce to your debt amount; the most common among them is to consolidate student loans or simply to refinance your student loans.
The following clip is from a documentary on student debt, which demonstrates the prevalence of the problem and the general unawareness that students have regarding their own debt. Like the girl interviewed in this clip, I would fear not knowing how much interest is actually adding up on my bills I need to pay. This is the main reason I chose this topic, to educate myself on how involved I need to be in paying my student loan bills when the time comes to do that. I hope you will all do the same.
Questions:
- What does Scripture tell us in detail about handling our money?
- We all know that the Bible tells us repeatedly that we are not to fear the future and God is ahead of us and knows our plans. But does this video cause you any concern about how involved you need to be to be able to manage your student loans?
26 comments
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December 7, 2009 at 12:42 pm
jtj
nice post jessica. very timely. (i did edit it a bit: mostly minor grammatical stuff, but i also added the sentence introducing the movie.)
in light of my massive college loans, this video makes me sick to my stomach, but you are right, it is important to be aware.
one question, you state at the outset, “there is no way to avoid debt”…is this true?
December 7, 2009 at 5:43 pm
Jessica McCleaf
my statement was involving debt of all sorts. Not only college debt. Whether its college or credit card debt and so on. And whether debt is small or large, going into college and being away from home and paying for college and living individually, I’m very sure each person will have debt of some sorts in their lives.
I’m guessing this is my post for the day… and that i don’t have to comment on my own post?
December 8, 2009 at 1:04 am
jtj
i wonder if the big “get out of debt” gurus consider a mortgage, debt? if not, i think it is very possible to not be in debt (in other words, to avoid debt).
you dont have to post, but try to answer some of the questions posed in these comments.
December 7, 2009 at 9:17 pm
Tom Catalfamo
What does Scripture tell us in detail about handling our money?
We all know that the Bible tells us repeatedly that we are not to fear the future and God is ahead of us and knows our plans. But does this video cause you any concern about how involved you need to be to be able to manage your student loans?
When i think of money the first thing that comes to mind is the story of the prodigal son, and when his father gave him money he ran off and spend it all and ended up having nothing. So i think if it is in the Bible in a negative way then it must not be good. I think that we should be good stewards of our money, but i honestly think there are ways to avoid these huge amount of debts. Its call community college i cant think of any community colleges that are more expensive then large universities, if you take that girl in the video as an example the one that barrows about 25000 a year if she goes to a community college for 2 years which most of the classes your first 2 years are the same so she is paying 50000 for something she can get for some where around 3000 if that. so i think that it is irresponsible to do things like that.
December 7, 2009 at 10:24 pm
Anna Barnard
Tom, you made some good points. I do believe the smarter thing to do is to go to CC for sometime and then transfer. However you said that it is also irresponsible to do things like that. (get Student Loans) What about the kids who wanna be doctors or marine biologists, they can’t just go to CC for two years and have a masters degree. What do you think the best solution is?
December 7, 2009 at 10:55 pm
Mike Tirrell
That is very true Anna. Sometimes the profession you choose does not allow CC time to get credits. But however Its is a smart way to go if you can do it.
December 8, 2009 at 1:08 am
jtj
I’m with Anna. The nature of some degrees seem to disallow community college. For example, getting into med school and law school is hard enough, i would imagine that a few years at Del-Tech make it more difficult. Not because it is a bad school, but it could limit recommendations, connections with students on the same path, relevant experience, etc.
On a different note, sometimes CC’s do not have the undergrad majors offered. For instance, I got a degree in Bible…not offered at DTCC!
December 7, 2009 at 10:08 pm
Ken Reilly
No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to one and despise the other. You cannot serve both God and money. We are encourage through the bible to be good stewards of what God has given us. We are to be wise with our money. We are encouraged to save but not hoard, to spend wisely, give back to God, and help others with our money. The bible discourages against borrowing (Proverbs 6:1-5). We are not supposed to act irresponsibly when it comes to borrowing and spending. We need to be very careful so we aren’t servants to the lender. I guess above all we are to be wise with our spending and borrowing. Unfortunately I think most of us will probably have to borrow money when we go to college. After watching this video I would say we need to be very careful on what these companies will charge us for lending money to us, it seems some may end up owing a lot more than what they have borrowed to go to college.
December 7, 2009 at 10:30 pm
Anna Barnard
Throughout the Bible, God calls us to be good stewards of our money. He only demands of us to give 10% and be wise with the rest of it. I think that as students is it a lot harder to be good stewards of our money because most of us do not really know where the line is. When it comes to student loans, I do not think it is a good idea to borrow more than 3-5,000 dollars. I think that scholarships are the best bet. Also a major part of having enough money for college is how you do in High School. I believe that HS is more important than what most people make it out to be. Because if you have a good GPA and what not, then you will get scholarships. So as students we have to be wise but also work hard, it is not an easy process. For me, I think that I have to be very careful when it comes to borrowing. Since I want to pursue the medical field, I need to work really hard. Going to a Community College is a great way to start and if you do well and get great grades, then colleges will pay YOU to keep up your studying. So with God’s help, I plan on doing that.
December 8, 2009 at 12:11 pm
jtj
youre right. but what about people who do not get scholarships? then what?
December 8, 2009 at 11:40 pm
Anna Barnard
Well, there are plenty of scholarships out there that are for people who might have either parents or family members who work in a certain field, say for instance the army, then you can get a scholarship through that. So it is not just grades and sports that enable you to have scholarships there are other things too. Grants are also good to look into.
December 7, 2009 at 10:55 pm
John Hale
The Bible does contain a good amount of advice on money. We are told to be good stewards of our money. We are also given the parable of the talents, in which we are encouraged to spend money (for good reasons of course). It is important to be wise with money – to only take out loans that you are familiar with the terms (it is wrong to not have any clue about how loans work like some in this video). I believe that the most important advice given in the Bible that related to money may be not to rely on money, however. God is in control, and we do have a higher purpose that getting a career and paying loans. Yes I am concerned about how to pay upcoming college loans, but in the end it is necessary to advance, and God will provide a way (though life, and hopefully through college).
December 7, 2009 at 11:02 pm
Mike Tirrell
Very true John. God told use to be good stewards of our money. and like you said ultimately He is in control. Now I think that this can be best described with the parable of the talents: Matthew 25.14-30
The Parable of the Talents
14″Again, it will be like a man going on a journey, who called his servants and entrusted his property to them. 15To one he gave five talents[a] of money, to another two talents, and to another one talent, each according to his ability. Then he went on his journey. 16The man who had received the five talents went at once and put his money to work and gained five more. 17So also, the one with the two talents gained two more. 18But the man who had received the one talent went off, dug a hole in the ground and hid his master’s money.
19″After a long time the master of those servants returned and settled accounts with them. 20The man who had received the five talents brought the other five. ‘Master,’ he said, ‘you entrusted me with five talents. See, I have gained five more.’
21″His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things. Come and share your master’s happiness!’
22″The man with the two talents also came. ‘Master,’ he said, ‘you entrusted me with two talents; see, I have gained two more.’
23″His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things. Come and share your master’s happiness!’
24″Then the man who had received the one talent came. ‘Master,’ he said, ‘I knew that you are a hard man, harvesting where you have not sown and gathering where you have not scattered seed. 25So I was afraid and went out and hid your talent in the ground. See, here is what belongs to you.’
26″His master replied, ‘You wicked, lazy servant! So you knew that I harvest where I have not sown and gather where I have not scattered seed? 27Well then, you should have put my money on deposit with the bankers, so that when I returned I would have received it back with interest.
28″ ‘Take the talent from him and give it to the one who has the ten talents. 29For everyone who has will be given more, and he will have an abundance. Whoever does not have, even what he has will be taken from him. 30And throw that worthless servant outside, into the darkness, where there will be weeping and gnashing of teeth.’
God want us to show determination and initiative with our lives, but without forgeting that he governs us. God never condemns having a game pla, just moving on it without his consent.
December 8, 2009 at 9:32 am
Gunner Kollock
God has told us time and time again to be stewards of are money and spend it wisely. The Bible never really talks about relying on money, but it primarily talks about relying on God. Money has always been an issue among many people in the United States and as well as other places. People constantly have to spend money to get even the smallest needs taken care of and the economy is in such bad condition that even when we try not to spend money and save up we are kind of forced to spend money in order to maintain life.
December 8, 2009 at 9:44 am
Ryan
gunner, if you read Luke 15:11-32, the parable of he prodigal son, it shows us that we need to be wise with our money and be smart with how we spend it.
December 8, 2009 at 9:47 am
Gunner Kollock
sorry for contradicting myself i did not realize what i said
December 8, 2009 at 12:12 pm
jtj
Ryan, i’m not so sure that the prodigal son has anything to do with financial stewardship.
December 9, 2009 at 12:54 am
Mike Tirrell
I think what Ryan was trying to connect was that the Prodigal son wasted all his money and ended up in poverty, so to the point that he wanted to eat what the pigs ate.
December 10, 2009 at 9:32 am
Ryan
actually i was just pointing out that fact that the Bible does talk about relying on God and about our money.
December 8, 2009 at 10:11 am
Keina Harmon
Gunner what about the 2nd question?
December 8, 2009 at 9:37 am
Ryan
What does Scripture tell us in detail about handling our money? Scripture tells us that we need to be wise with our money. We are supposed to give ten percent of what we earn to God, and then be wise with the rest of our money. God will take care of us and our financial issues as long as we trust in Him, and do our best to to help the situation. Like Mike said “God never condemns having a game plan, just moving on it without his consent.”
We all know that the Bible tells us repeatedly that we are not to fear the future and God is ahead of us and knows our plans. But does this video cause you any concern about how involved you need to be to be able to manage your student loans? After watching this video i do not have any major concerns with managing any student loans that i might take because the career goal that i have chosen is centered on Gods will for my life and i can get a degree at a community college.
December 8, 2009 at 9:38 am
Jessica Stratton
Ughh. This is not a video I want to see right now with college coming up.
Nice post though Jessica.
Well the Bible tells us to be good stewards of our money. Luke 14:28-30: “For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it? Lest haply, after he hath laid the foundation, and is not able to finish it, all that behold it begin to mock him, Saying, This man began to build, and was not able to finish.” We need to take a long look at our intensions of spending and figure out if what we are buying and investing in is really worthwhile.
Maybe this analogy will help. I would much rather invest my money into a great college education. I would rather fall into 20,000 dollars of debt from student loans that I have to pay back monthly than have a 400 dollar car payment for a new 20,000 dollar car. At the end of four years I could have a degree and a huge start on my future in the career I had majored in. But if I bought a car, I would have a outdated car with miles that will always need more money to be put in due to maintenance. I think college is a great investment if you really research your schools personality heavily, and it matches to your wants and needs in a school.
This vide has made me want to further research the different type of loans that I can apply for for school. I plan on going away to college and with my parents not being able to help me out, I will have to take out student loans and this video brought to light just how bad interest can be. It also makes me want to apply to every scholarship available to man kind.
December 8, 2009 at 12:18 pm
jtj
I hear you Jessica! I like your analogy of car vs. college. There are certainly ways that you can decrease your daily expenses in order to pay for college. Ideally, it is nice not to go in debt, and you can help this along by working through college.
I would encourage you to figure out what constitutes a “great college education.” you can pay a lot of money to go to a christian liberal arts school, that in the end, the degree is not that much better than state schools. is the experience of going to this type of institution worth the money? will it be formative in your life? these are tough questions that each student should wrestle with.
Side note: Do you always use the KJV?
December 8, 2009 at 10:09 am
Keina Harmon
The Bible does tell us to be good stewards of our money, and to tithe 10% based on our earnings. (Malachi 3) Give everyone what you owe him: If you owe taxes, pay taxes; if revenue, then revenue; if respect, then respect; if honor, then honor. Let no debt remain outstanding, except the continuing debt to love one another, for he who loves his fellowman has fulfilled the law. (Romans 13:7-8) Paul writes it plain and simple pay your bills and do not be in debt.
It does not cause me concern it more actually prepares me, it made me look at student loans differently. The video helped me see that student loans are not fun if you do not pay them back and they can be dangerous if you borrow to much money.
December 8, 2009 at 3:28 pm
Jessica McCleaf
awesome posts everyone. I think i got my point across for the most part… Good challenges that i didn’t even think of myself. =)
December 8, 2009 at 7:41 pm
Sam Hommel
God clearly states in Luke that we are to be wise with our money. After all, it is not our money anyway; it is His. When coming to a decision concerning money, I think that it is our job to really pray to God about whether the purchase is necessary. This video really scares me. I hadn’t thought much about student loans, and the ongoing struggle it will be to pay them back. As we will all be college students in the near future, this is really something we need to think about and start planning for now.