How Student Loans Ruined My Life

Please note that this episode deals with difficult conversations and thoughts of suicide. If you're having suicidal thoughts, help is available. You can call the National Suicide Prevention Lifeline at 1-800-273-TALK. You can also reach out to the Crisis Text Line. Text the word "Hello" to 741-741. You are not alone, and there is always hope for you. There were times that I was just, I was giving up because I want to pay my student loans, and there was a really pretty place called Sunset Clips in San Diego, and I loved the beach and the ocean, so I would drive out there to calm myself, but I really just wanted to drive off the cliff and be done with it because I was worth more dead than I was alive. From Ramsey Network, I'm George Camel, and this is Borrowed Future, a podcast series exploring the $1.6 trillion student loan debt crisis and the impact it's having on real people. In this episode, we explore the burden that college debt has put on people's lives and expose the predatory nature of the student loan industry. You just heard part of a heartbreaking story from Terry, a 47-year-old woman who has been dealing with the weight of student loans for over 24 years. To say her life has been altered and delayed due to her student loans is an understatement. Here's more of our conversation. So let's start here. Take me back to the moment when you took out student loans. What was going on in your life? I was on my 30-year college. They had cut off all my grants, and so I had no financial aid to be able to pay for it. I was already working two jobs at that point going to school full-time, so they offered me the student loans. She said that's the only way I would be able to stay in college. And since I had no money, I was like, okay, when she was telling me about the student loans, it made it sound like it was very simple. You know, you don't have to pay it back until six months after you graduate. So it sounded like a feasible solution to my dilemma. So I went ahead and took the $5,000, which covered my tuition. So that started the cycle of debt in regards to education. So when you took out these loans, did anyone explain to you how it works? Did they explain how long it's going to take to pay off? How big the interest was going to accrue? What the rate was? They told me the rate was going to be 8.25 percent, which, okay, the rate is 8.25 percent, but what does that mean? It was almost like they were just baiting us into these subprime loans because, you know, you're only going to have to pay $100 a month starting out and then a little gradually increase, which was true, except for the interest kept compounding and compounding and compounding to the point where you never catch up. I made $100 payment and $5 went towards the principal and the rest went towards interest. And so I'm just never moving forward as I went through and the student loans started, you know, I was like, oh, okay, you know what, I'll get this fantastic job once I graduate, you know, it's going to be okay. I interned in my fourth year of school with the city attorney's office, but when I was interning, I was working two full-time jobs, a part-time job. I was supporting my mother and myself and going to school full-time. So my work suffered and they offered the position to someone else. So when I got out of school, I'm now $20,000 in credit card debt, $15,000 of student loans. So we've got $35,000 in debt after a seven-year journey to get a degree, which didn't land you the job. No. I guess where I don't even want to look at that diploma. Do you regret getting your degree? I absolutely 100% do. I wish I'd never went to college. I have never put that diploma up ever. My balance is now $60,000 and growing. And that's while you've been making payments on it? That's while I've been making payments on it. Yes, sir. So that $15,000 loan grew $45,000 in interest. Yes, sir. Was that something that you thought could be a reality when you took out the loans? Absolutely not. Absolutely not. I felt hopeless and I felt like a loser because I don't believe in stealing. And basically, since I wasn't paying my debt, I was a thief. The creditors at that time, they call you and they call you a thief and that's you're not worthy. You stole the merchandise and you're not paying the bill. So there were times that I was just, I was giving up. I was giving up and there was a really pretty place called Sunset Clips in San Diego and I love the beach and the ocean. So I would drive out there to calm myself. But I really just wanted to drive off the cliff and be done with it because I was worth more debt than I was alive. And it still to this day affects me because I want to pay my student loans and I just, you know, it went from $15,000 and the interest just accumulates. It wasn't actually until I took Financial Peace University that I really understood interest and how it works and how you just keep digging a hole that seems like you could never get out of it. Those suicidal thoughts, do you blame the student loan companies for that? I blame them for not telling the truth. You know, you tell me the truth about this is going to keep going up and when you carry such a weight like that and you owe someone, it's almost like you're a slave and you don't have any freedom. I never even used my degree because the whole thing was to become a lawyer. What was I going to do? Take up more student loans and be in more debt that I could never pay back within the time frame with the percentage rate they're offering? I'm not accomplishing anything. I'm just hanging out there, you know, because everything I had planned was all wrapped around my education. Do you think you'll pay off your student loans in your lifetime? Not at this rate, no. I don't. I'm going to keep doing what they taught me to do in order to keep in good standing, so I'm trapped. What would you tell a high school student who's on the brink of signing up for student loans to get that education? That you're better than that. That it would be easier for you if you have to wait to go to college to save the money and work rather than putting yourself under this debt and this burden that's relentless. Go and get two jobs, whatever it takes, pay for your education. If you don't get grants or scholarships, just save up your money and pay for yourself. Don't do that. Don't sign that paperwork because you'll never forgive yourself for doing it. Terry's story is hard to hear. It's a reality that many people never think they'll have to face. Every student you've heard in this series has had high hopes and no worries when it came to the financial side of adulthood. They were more worried about making friends in a new environment than they were about how they were going to pay back their potential student loans. Student loans are a weight that can and will slow you down in adulthood. Here's Anthony O'Neill, author of the best-selling book, Debt-Free Degree. Picture you're walking down a road and every time you take one step someone puts a brick on top of your shoulders. The very next step, someone puts a brick on your other shoulder. The very next step, someone puts a brick on top of the brick and eventually you start feeling the weight on you. Eventually your shoulders start hurting and eventually you just want to stop because you can no longer take it. That's what debt does. It puts unnecessary weight and stress and drama in your life that you do not have to deal with. You know the sad part is that we as the consumers we can make that decision to either avoid it or we can put the weight on ourselves. What does debt do to us? It hurts us. Not just our future but even our present. Every time you sign a student loan or every time you sign some type of credit card or loan or card note what you're saying is I'll take the stress of this payment. I'll take the stress for the next few years just so I can please myself right now. Stress, anxiety, depression and even suicidal thoughts are all part of the package when it comes to student loans. While Terry's story sounds like an extreme outlier, sadly it's not that unique. According to a recent survey done by the website Student Loan Planner, one in 15 student loan borrowers with a high debt load of over a hundred thousand dollars have considered suicide because of that debt. The predatory practices that led Terry to a dark place happen to student loan borrowers every single day across the country. Seth Frotman has seen it firsthand. He's the executive director of the Student Borrower Protection Center in Washington D.C. Prior to that, he worked for years at the Consumer Financial Protection Bureau, a government agency designed to protect students. When he quit, he said quote, "The Bureau has abandoned the very consumers it is tasked by Congress with protecting." Here's his insider's take on the dark underbelly of the student loan industry. So unfortunately what we have seen is that there is a litany of companies that just pray on students. So this is everyone from private student lenders and big banks, to student loan servicers, to debt collectors, to for-profit predatory schools, private equity companies, social media companies, and I could just go on and on. I think what you see is where there is money to be made off student loan borrowers, there are folks who are willing to create business models that exist solely to prey on them to try to drive profits. And I think we need to be more cognizant of this fact and realize that the millions of people in this country in student debt need fierce defenders on their side at the federal level, at the state level, because we just can't keep burying our head in the sand and call this good debt and think those folks involved are inherently pure actors because, you know, they're working on issues around student debt because every piece of history we have just shows that that is not the case. What we saw at the Bureau was just from before you even took out that loan until you were trying to pay it off. People are just getting ripped off at every turn. So I have seen people driven into student loans that would make payday lenders blush, you know, double-digit interest rates, outlandish origination fees. Then, you know, you're trying to pay back your debt, you're entitled to benefits, your title protections, or you're simply trying to make a payment and the student loan company you reach out to is just giving you no information, conflicting information or bad information. And then all of a sudden you're in the hands of a debt collector who's aggressively calling your employer or can't even prove that you owe the debt while they're trying to get default judgments against you. So you took on this debt and either in the process of doing so or while you were trying to pay it back, you were just getting ripped off at every turn. And what that usually led to was crazy high interest rates, unnecessary fees, racking up interest rates, or simply trying to pay back your loan and the process breaking down. But on top of that, this host of predatory players just made that process worse. And not only was it impacting your loan balance, but it was having this huge impact on the rest of your financial life. I think one of the most important decisions for people who are thinking about college now is to realize the ramifications of these decisions. And in my work on the consumer protection side, we have seen just a dizzying array of practices that are downright deceptive, high pressure sales tactics and just outright lies. And I'm the first to realize that these are really hard decisions. And there's, I don't know how many years of American law telling you go to college, take on the debt, it will all be worth that. But there are companies on the other side who know that that's the other bug in your ear and know that the debt levels that you take on now will travel with you for nearly a lifetime. So pressure test, don't be bullied into sighing on the bottom line of an enrollment agreement because a school called you repeatedly or because you saw there and constantly pop up in your stream. And I know it's hard and I know a lot of this is just really opaque. But try to do your homework, try to understand, will this degree lead to the income I think I'm going to get? Or even more important, if I want to, you know, go into a field that requires a license, will I even be able to sit for that exam if I sit here? And I know this only covers kind of one segment of what else higher ed, but it's really important to know that there are schools out there who just have predatory business models who have a history of praying on students, of promising the world and leaving them with a mound of debt and a degree that isn't worth the paper it is written on. And it is okay to take a pause, to step back, to ask questions, to do some research because it is incredibly important to do that before you sign on the dialing. The student loan system is rigged against you and there are companies on every corner trying to rip you off to make a quick buck. Dave Ramsey, financial expert and host of the Dave Ramsey show, describes the industry as a different kind of predator. Student loan lenders are not predatory like you would think of a payday lender or you would think of a rent to own, you know, these gross slimy things where these guys with a, you know, sell your Rolex, right? Kind of a thing. They're not that kind of a predator. It's much more sophisticated and subtle and slimy, but it's all just below the surface. It's like assumed that everyone gets a student loan and if you don't get a student loan, well, you don't understand. And so it's this aristocracy kind of ridiculous methodology and their messaging. It's a put down, it's a shaming technique that if you don't take out student loans, well, you just, you know, people that say you can do this without student loans, they just don't know. They're not the smart, the smart people. This is what the smart people do. Are you smart people? See, that's predatory as it can be. The student loan problem has reached epidemic proportions. It's a plague. The curve on the growth of credit card debt, even though it's been ridiculous, has been much more gentle than the curve on student loan debt. It suddenly got completely crazy. It was always in the dumb column. It was always kind of uncomfortable, but suddenly in the past five to 10 years, it's gone to a mushroom cloud in terms of the mathematics on it. And we're seeing the exact same weight that that cloud represents hit our listeners, hit the average American family. And we see that when they get free. So I used to get a call that was $30,000 in student loan debt and $40,000 in credit card debt. Now I get a call that's $40,000 in credit card debt and $140,000 in student loan debt. And that's a pretty typical call on a day in, day out, hour in, and hour out on the Dave Ramsey show. What's crushing the collars on Dave's show isn't just the amount of debt they took out. It's also the interest rate. What many student loan borrowers don't know is that the interest rate drastically increases how much they're actually paying for their degree and makes their debt much more difficult to get rid of. The bottom line is that interest rates cause you to pay way more than the actual amount you borrowed because a huge chunk of your monthly payment disappears into the lender's hands. Anthony O'Neill walks us through what this looks like for the average borrower. Currently, there's little over $1.6 trillion in student loan debt. The average person will graduate about $35,000, which is about an average payment of $393 when it comes to their monthly payment. So the federal government is actually set up to where you pay back this loan within 10 years. But the average person is saying, you know what, I can't afford $393, so look, can I stretch it out to 20 years? That payment goes down to $222 a month based upon the $35,000 loan. This person is going to pay nearly $50,000 back on that student loan. But if you just take that aside, it's all right. Instead of for taking out student loans, you can just flip that in the same 20 years, have a little over $60,000 invested. Do you see exactly what's happening? It's robbing us and we're paying back interest and it's robbing us from even gaining interest, from gaining some type of reward, gaining something to go towards our future. People are in bondage for 20 years. They didn't know what they were signing up for. If I took $15,000 out of your bank account today, I would be a thief. But if I slowly took $15,000 out of your bank account over 20 years without you really noticing, I would be a really sneaky thief. That's what these lenders are. Anthony's example is a conservative estimate that's based on fixed rate federal loans. But private loans are even worse because they can have variable interest rates that can soar into double digits. These loans deserve their own circle of hell in Dante's Inferno. Many of the borrowers that I talked to just sort of stumbled into whatever student loan was offered to them, completely ignoring the fine print. And in many cases, they weren't even told what the interest rate was or how it worked. Did they tell you what the interest rate was going to be? I'm sure they either told me or it was on paperwork that I signed, but I don't have any recollection at all of it. Some of them were private loans and some of them were federally, you know, backed loans. Were you aware of the interest rate when you took out these loans? I think I may have been aware in the in the fact that I read it because I'm pretty diligent about reading anything I sign. But I don't, eight percent doesn't really seem like a lot. But I guess it's a lot when you're looking at $12,000 and then over the course of years, it just adds up and adds up and adds up. So I think some of that is fees and you don't, I don't know, you don't really know. And I'm not even sure I even open all the mail. So I just woke up one day and it was $39,000. Wow. You just woke up one day and it had grown 400 percent. Exactly. Exactly. How did that feel when the day you realized that? Was there one moment where you went, oh my goodness? Yeah, I was and I started making phone calls, like what's going on and why is my loan $39,000? I actually got a balance a little bit before it was $39,000. I saw that it was $34,000. So I already started freaking out. And then all of a sudden, I got this mail that says they added default fees in the amount of $5,000. And now that $34,000 that was due on Tuesday, on Wednesday, it's now $39,000. So yeah, it's yeah, most people would look at your loan at $12,000 and say, well, that's reasonable. You pay $1,000 a month. That'll be gone in a year. And now it's $39,000 and it's a mountain decline. Exactly. So you took student loans out at 58 years old. Is that right? That's correct. And the lenders just gave you this money. How easy was it to take out student loans and how much did you take out at 58 years old? Each class was about $1,500. It was very expensive. It was a private university based out of Orange County, California. So did they talk to you about how long it would take to pay these student loans off considering you're taking them out at 58 years old? No, they did not. It was all done through the university. They had a financial advisor, but you know, here's the money. You keep applying. That's what you did. So the financial advisor said, here's the advice, take out loans. Yes. Wow. Did they tell you what the interest rate was? At the time, it was very, very low. It was like one and a half percent, which was doable. It was a staffer loan federally funded. A lot of this debt now is because of a crude interest. And then when I consolidated the two loans, one for the undergrad program and then for the credentialing program, all at the same university, then the consolidation bumped it up to four percent. So I'm paying four percent on the money. So I got my masters in 2008. And by now, I'm 74 years old and I'm $70,000 in debt. Every year, I have to submit to keep the payments down because I cannot afford to pay my student loans off. So sorry to hear that. And I do substitute teach, but not all the time because I have to balance the other job I have. And what's this other job? I'm a crafts and fabrics associate at Walmart. And what do they pay you there? $12.90 an hour. Now the current balance is about $71,000 at 4.1 percent interest. Yes. And it keeps accruing. Do you know how much interest that's accruing? Well, 4.1. That's it per month. Yeah. In dollars, have you done the math to see kind of what that shakes out to? No. All I see is the big balance and there's nothing I can do. The bright side, the student loans will probably go to the grave with me, but my children will not incur that debt when I pass on. That is a dark bright side. I know. Yes, I know. Rather dismal, but you know, if you don't laugh, you cry, you know. So did they talk to you about how long it would take to pay off your student loans or what the interest rate was? No. And they're not required to. They are exempt from, and this goes into the law thing, but in the Higher Education Act itself, the truth in lending laws, the Department of Education is exempt from giving you those disclosures, so they don't have to. What amount of student loan debt did you leave school with? I left school with probably about $80,000 of student loan debt, yes. And what is your current total student loan debt? My current total student loan debt is $155,000, and I've been out of law school for 13 years. And so you've been making the payments. You haven't missed a payment. Correct. Correct. And your debt has grown? Yes. By about $75,000? Yes. And that is strictly because of interest? Yes. Wow. So your debt has almost doubled just an interest loan while you've been paying it down. How does that feel? Well, not great. That's Beverly Wheelahan, an attorney in Michigan who has focused her practice on consumer law and student loan law. While dealing with the burden of student loan debt herself, Beverly represents borrowers against collection agencies, gets them out of delinquency and default, and sues debt collectors for wrongful acts. She's basically the Batman for student loans. Here's our conversation. Talk to me about the differences between private and federal loans. Okay, so federal loans are those loans that you will get from the federal government, and they have options for you for forbearance, deferments, and income-based repayments. A private loan is a loan that is through a bank or a credit card, and their options for repayment are you pay us or you are in default. There rarely has any forbearance. Some private loans can start repayment while you're in school. Some won't start repayment until after you graduate. The biggest pitfall of the private is they're usually high interest, and if you don't pay them off in default, they will hang over your head for the very rest of your life, that you're just digging a hole, that you know the likelihood of getting out of is pretty tough. Federal student loans have no statute of limitations, so you have these forever until you pay them off, or your term of repayment is over. Private student loans, depending on the state you are in, there are statute of limitations, meaning they cannot sue you if you are in default after a certain time. So I practice in Michigan, so I can't comment on other states, but in Michigan it's six years from the day to default for them to sue you. So can they sue you if it's a federal loan? Yes, but they don't really have to because under the Federal Collection Act, they do contracts with third-party collection agencies, and so if you are in default on a student loan, they'll send your employer a letter that says under this specific act you need to next paycheck cycle, garnish that person's wages. There's no court order required, so they don't even sue you to get a judgment, they just start garnishing wages. Wow. But they really don't have to because they have collection powers outside of getting a judgment. So no day in court, here you go, wages garnished. Well, let's dig into that impact. So you're talking to these clients, they're defaulting on their loans, they can't make the payments. What sort of things can happen to them and do happen to them? So for federal loans, it's pretty much they'll start garnishing wages. They'll seize any federal tax return that you may be entitled to, which oftentimes for some people, it can be a couple grand or more, so they will seize that. Also, if you're retiring and you start collecting on your social security income, if you happen to be in default on a federal student loan, guess what? You're not getting your full social security because they're going to garnish that too. If you work in certain industries for the government, you may lose access to certain security privileges if you're in default on a student loan. Some states, if you're in default on a student loan, if you're a lawyer, you can't practice law. There are, I think it's 14 states that say that that's not ethical and they will pull your license. A private student loan, they can sue you, so they have to sue you first to get a judgment against you. And then once they have that judgment, they can garnish wages, seize property, garnish your bank accounts, do a lien on the state tax return in any of the state mandated execution on a judgment. So every state's a little different on what they're allowed to do. Wow. You can even be arrested. The fund just keeps on rolling. Yeah, you can be arrested. There's some states like Michigan. If you are in default on a loan and there's a judgment against you and you've been served notice at the last known address that you haven't lived, say, for eight years and you don't show it for a court hearing, for what's called a show cause, for a creditor's exam, what oftentimes will happen is they will issue a bench warrant for you. So you get pulled over for broken tail light and off you go to jail because there was a judgment out there against you that you probably didn't even know about. And the police officers don't know when they pull somebody over what a bench warrant is for. They just have, must arrest them for it. Wow. It's debtor's prison. I wish, I wish every high schooler that's about to sign for student loans could just listen to our conversation. Yes, I'm telling you. This sounds like hell. It is hell. And it's hell because you didn't know what hell it's going to be until you're there. Anybody I can talk to about it to say run away, don't do it. I do all the time. You shouldn't sign up for anything you don't understand, especially student loans. So why do so many students do it? One reason is because it's so incredibly easy to get loans for higher education. With a few simple online forms and clicks, money instantly appears in your bank account. Brad Barnett is the financial aid director at James Madison University and teaches a personal finance class every semester. He's not a fan of this unlimited money and doesn't want to see students rack up debt to attend any school. So this is always kind of the quandary in the business is what happens? Can we load them up with loans to come to your school? Well, the reality is in most cases, you can't say all, in most cases could someone borrow enough to go to almost any school they wanted to. The answer is yes. I mean, there's federal loans, there's private loans, there's parent loans. So now not in all cases because there's still some credit eligibility. But we're not about that. Again, I don't want people coming here and taking out tens of thousands of dollars in debt if we can avoid it. Some will come and borrow. Some will borrow very minimally. Some will borrow a lot, but we feel we have a responsibility to have that conversation with them to let them know if you choose and it is a choice, then this is what's going to happen on the backside. And are you prepared for what's going to happen on the backside? I mean, ultimately, if they decide to come and borrow, we can't really stop them. But we want them to be educated about the whole issue of these are the repercussions on the back end. And this is what's happening in current day life. The ease of taking out student loans doesn't just affect the students. It also affects the colleges. Entrepreneur and investor Mark Cuban shares his take on how colleges are taking advantage of the student loan craze. Well, if you go back to the housing bubble of the mid 2000s, right before the Great Recession, you saw prices of houses just keep on going up. And the reason they kept on going up is because anytime anybody wanted to buy one, it was really easy to borrow money. And it was so easy that people could just buy a house, you know, turn around and try to sell it and make some quick dollars until the easy money went away. And college is going through the same thing. It's so easy for students to borrow money for tuition, housing, room, board, et cetera, that colleges know they can keep on raising prices, at least until recently they've known that. And that's created a problem for students. And it's also created a problem for colleges because they've been able to raise tuition so much. It's pushed them into adding things onto campuses that really weren't needed. You know, they're to the point now where they have more administrators making $200,000 a year than they have professors. And so that's not a good thing. Like Teddy Roosevelt once said, nothing worth having comes easy. Student loans, while easy to get, are never worth it because the easier path can lead to a much more difficult journey in the future. Chris Hogan, financial expert, bestselling author, and host of the Chris Hogan show wants people to have a clear plan for their money and their future. You know, if you don't have a plan for your money, someone else will. And for young people out there, I think with this student loan debt crisis, the problem is, is that a lot of these lenders out there have a plan for you. They want you to sign on to the dotted line. They want you to begin to have this appetite for debt that they can continue to feed over the years with credit cards, car loans. And so I want to encourage young people out there to see debt for what it is. It feels like your friend initially, but then it starts just taking. It takes a payment. It requires a payment. It wants a payment month in and month out. And you start to realize that debt doesn't care about your health. It doesn't care about your future. It just wants to take. So if I can get young people to see debt for what it is, I feel like I can help them protect themselves. In a world of one click shopping and one day shipping, it's not a shock that student loans are as convenient as ordering from Amazon. I asked borrowers exactly how easy it was to get money from student loan lenders. Was it easy to get the loan? Yeah, it wasn't too bad. My dad helped me out a lot with it, so it's good having a good having a parent that's very good with financials. So did he sign the loan with you? Yeah, okay. So it's kind of on the hook then if you don't pay? It definitely is. Yeah, one big time he is. Yeah. Was it easy to take out loans? Yep, it pretty much is. They give you the form, you assign it out, you know, and off you go and you don't even think about it. Your goal is to get through school. That's what everyone tells you. When I went to school, I even had a financial planner tell me, you know what, student loans not bad. Don't worry about it. And so you just take it on. How easy was it to take out these student loans? Oh, super easy. I mean, I don't even recall the whole process. I think we went online and you know, I signed paperwork and I would go to the registry's office at the beginning of classes and sign something and the money would be deposited into my account. So it was super easy. Wow. So you just typed out, you know, $130,000 plus. Yeah, hit submit. You show up at the school and you sign a document and all of a sudden it's just in your bank account? That's pretty much. I mean, it happened every semester. Obviously, it wasn't just one chunk. Each semester, you know, we would take out more loans and it would be deposited into our account and that's what we lived on. How easy was it to take out loans? Simple, simple, simple. There was a promissory note. You just tell them how much you want and literally it just was you just sign on the dotted line. It was no different. It took about as long as it would take for you to walk into the bank and make a withdrawal at the teller. It was just really that easy. And they just sent the money to your bank account? They sent your check because, you know, that was 2006. So they didn't do it electronically. They sent your check and then you deposit the check and do whatever you want with it. If I wanted to, I could have just bought a car. So no one's keeping track of where that money is actually going. Is it going to tuition and books? No, not at all. And the only thing that they need to know is that you're still in school because once you graduate, obviously they're looking for payment. Once you graduate and you've been out of school for six months, then you have to pay back. So how easy was it to take out these loans? It was horrifyingly easy. I don't even remember get, I remember filling out a little bit of paperwork on the website and then you log in and then you just get approved for the max. I got approved for the max. It was like $70,000 a year to go to school and you just see the balance and you can type in your bank account and just transfer it instantly. So you don't even really have to do anything. And you don't have to give a reason or link it to a class or anything. You just 70 grand. Where do you want it? So the first year I didn't take out the full amount. But I think I took out maybe 50 grand the first year. I would just pay when classes come up. But it's so incredibly easy to take it out. And there's nothing in there about a term and interest rate, anything. It's just a bunch of money in your student account. That's insane. So you log into the student loan website. It says, hey, you've been approved for 70 grand. How much do you want? Enter your bank account info. We'll send it right over. It's literally what happens. You get it like the next day. Yeah, that's insane. It was crazy. You should not. I mean, I just felt like I had unlimited money. I wasn't thinking at all about how I was going to pay that back. That's Blair, a bank executive who went into six-figure debt for a degree and is now forced to live like a broke college student while bringing home a six-figure income. So how much did you take out total in student loans? Oh gosh, total. When I refinanced it three years ago to just get all my undergrad and grad together, it was $136,000. So you said your minimum payments were how much when you came out of grad school? When I did the refi, it was $1,500 a month. Wow. So you had about a mortgage payment and student loan debt for the first time? Yeah, it was terrible. On the outside, you look like you're balling. I mean, you look like you are living the dream, but you're broke. Yeah, I'm so broke. And my family thought that I was just killing it. I've got this awesome job in DC. I've got this nice car and living in this like nice neighborhood. I mean, it looks very nice. I can't pay for anything. I'm like maxed out quite literally. What kind of emotions were you feeling as you're feeling the reality of all the debt? It just hit me like a ton of bricks. I mean, looking at my net worth, maybe want to jump off cliff. It was so bad. It was like negative $155,000. You just don't know what to do. You're paralyzed and you just get depressed. I didn't sleep for like the first year because I was always worried something's going to happen to my car or something's going to happen. I'm going to owe the IRS money again and you need to pay that immediately because they're crazy people. You don't feel good. You don't feel comfortable. You don't even want to leave the house sometimes. Like I was actually really depressed. It was horrible. I mean, I wasn't sleeping at all. You just can't think about anything else. It's awful. How have student loans held you back from other areas of your life? Oh my gosh, it's awful. So I want to buy a condo. I can't afford that right now. I could. If I didn't have my student loans, I could have a great condo. Sometimes I look at them on Zillow and just stare at them like you idiot. You could have had that condo. So I have no condo and my car Rusty. I love him, but I would like to be driving a nicer car. I work in a job where I have clients. I want to be able to drive them around and not feel like why are you doing this job? Do you not make any money? Are you a terrible banker? What are you doing? So have an old car also. Its name is Rusty. It has rust on it. So if you didn't get that, I would like to be driving a non rusty car at this age, making this salary, doing the job that I do. It's ridiculous and weird. I want to go to Whole Foods and buy groceries. Can't do that. I'm going to Aldi. I mean Aldi is great. I don't want to rag on Aldi. It's wonderful. But I like Whole Foods. Okay. So those are the things I would like to do. I love that. Thank you for your honesty. It all made me very happy. I have a quarter holder because I need quarters to use the car. It's not the glamorous lifestyle that I envisioned. What is debt due to us as a consumer? It just adds stress and it destroys and it kills our dreams. It makes us comfortable. And I believe that some of us are allowing our comfort zone to become our kill zone because something is comfortable today and it's comfortable tomorrow and we don't even know that moving forward. It's the very same thing that's killing us of accomplishing our dreams. It's killing us from starting that business. It's killing us from graduating debt free. It's killing us from being able to graduate debt free. Then also to go into our career field. It's killing us to be able to leave a legacy for our children's children. It's killing us to be able to take our families on vacation. It's killing you from all the great ideas that are deep down inside of you. But you can't get to them because you got to get through all the debt. We cannot allow being so comfortable to go out here and get these student loans and get this credit card and finance that card. That before we know it, we wake up and we're to $300,000 in student loan debt. Before you know it, we wake up and we're in $55,000 worth of credit card debt. Before you know it, our dreams are killed because of our comfort zone. You see, the truth of the fact is nothing extraordinary comes from within our comfort zone. It happens when we force ourselves to step outside of our comfort zone. It happens when we force ourselves to look up grants, to look up scholarships, to work 10 to 20 hours a week. It happens when we say, you know what, we're not going into debt. We see everybody else is comfortable. We see everyone else is having a good time, but we're willing to be uncomfortable so we can be comfortable for the rest of our life. You guys, the system is broke. The system was not made for you and I as a consumer. The system was made so that they can profit, so that they can benefit from it and we have to deal with those choices. But here's the truth. We don't have to follow those rules. We don't have to sign the student loan paperwork to go to college and we do not have to go to that particular college for that particular cost. That's the kind of system that I want to see. Not the system right now that is set up to put us in bondage. That is set up to make us pay $100,000 for a college experience when I may only make $40,000, $50,000, when you may only make $40,50, sometimes $30,000. Depending on what state you're in, an average school teacher is going to make $38,000 a year, but it's going to cost them $112,000 to get that degree. But in this season, when you go off to college, it's not about being comfortable. It's about being uncomfortable because being uncomfortable today brings you comfort tomorrow. This system is not made for you and I to win, but there is a way you and I can win and that is a debt-free degree. It's not fancy, it's not nice, but with hard work, you can do it. Borrowing against your future always turns into paying for your past. That can take a long time and with interest, a whole lot more money than you planned for. The only way to avoid the burden of student loan debt is to avoid student loans altogether. Don't fall for the predatory practices of lenders who want you in debt and want to keep you there for as long as possible. In the next episode, we'll talk about how we got into the student loan debt crisis in the first place and what the future will look like if nothing changes. There's this enormous mismatch between what borrowers are promised and what's happening on the ground and in between our student loan companies and we've seen those companies fail at every stage. Join me. You've been listening to Borrowed Future. If you like what you've heard, do us a favor and rate and review us on Apple Podcasts. It helps. You can find more information about this and other Ramsey Network Podcasts at BorrowedFuture.com or on your favorite podcast app. Our show is produced by Chris Wright, Eric Cheslevich, Eva Daniel, and Kevin Weimer. Music has been curated by James Childs. Will Rudder is our engineer. Our editor is Tim Hull. Blake Thompson is our executive producer. I'm George Camel and remember, Sally May is not an actual person. Just a sneaky thief.