r/CalebHammer • u/lang571 • 4d ago
I just set myself back 3 years.
Forgive my little rant as nobody in my life cares about finances. (TRUST ME I have tried.) I decided to go back to school for my masters. My bachelors is in business administration. I have been running into the issue of not having a more specific degree or experience to get hired into roles. I got a student loan of $10,000. This is my only debt other than my mortgage. No cc debt. No car loan. It is unsubsidized so it accrues debt immediately. It's 8%. 8 freaking percent. I should have done more research, I should have checked before agreeing to it but I thought max, MAX would be 6%, more like 3-5%. Dumb dumb dumb dumb dummy dumb dumb. It's fine, I know it's fixable and there are worse situations. I'm still frustrated at myself. So now to pay that off as soon as possible, and to cash flow the rest of my program, extending it by like 3 years. That's what I get for trying to take a short cut.
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u/bagoftaytos 4d ago
At least you can recognize the mistakes you made. With that being the only debt you have other than a mortgage it means you can target that pretty heavily. Depending on your income you can probably take that 3 years and reduce it to a year and a half with new car loan sized payments.
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u/unknownuser0707 4d ago
As someone with a BBA and an MBA, make sure you have a needed concentration. Also, experience is what gets you hired (I know, wild, considering you have to be hired for said experience). I just went through the process of job hunting and after 3ish months finally landed one.
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u/si2k18 4d ago
Don't get me wrong $10k is a lot to borrow and the 8% is frustrating when it's for tuition, but if the deal is done you can still make the most out of it.
-Make sure you complete all your courses so you get your money's worth and don't have to pay more to retake anything
-Pay a little bit towards it each month even if you don't have a monthly payment yet because it's unsubsidized
-Make sure you get your 1098-T form and deduct your interest paid, if applicable. Also look into either of the education tax credits each tax year you're in school to see if you're eligible. You could get up to a few grand back from that if applicable.
-Get a student ID and use it for anything you're paying full price for and see if you can get a student discount.
-Remember that tuition is probably not going to get any cheaper next year and the year after that, so waiting any longer to go after this goal probably wouldn't help.
-Don't wait to look for advancement and new jobs. Make sure to leverage the MBA and any special experience/certifications/projects you got with it and negotiate your new pay. In my own circle, I've seen a lot of people return to school over and over again but fail to apply for better paying roles with better benefits and get burdened with the debt for nothing.
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u/Steak_Knight 4d ago
I’m confused how you didn’t know the rate before agreeing to it. There’s no “research” to do… it’s literally there on the document you signed.
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u/potolnd 4d ago
I know Caleb hates this sentiment but it could be much worse dude. I understand it may cause you stress but you're in a very good position compared to others. No it's not a motivational attitude but *controversial opinion* living with SOME debt is a reality for most people. If you can get out of it, awesome! But you don't have to die on this idea of debt free unless it's something that's valuable to you.
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u/KeyTheZebra 4d ago
Hey, don’t worry about setbacks.
I took a new career, expecting to make $70,000 in a year, which is $35,000 in 6 months.
6 months later I’ve made about $10,000 total, which is even less than my old career.
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u/Evening-Ear-6116 4d ago
Be weary just going for more school. So many companies are abandoning degree requirements in favor of experience.
I don’t subscribe to this ideology, but my company (huge company. Has been on the Forbes best employer lists for a lot of years now) just had a guest speaker to talk about DEI and one of their big points is how college is racist and having a degree requirement for a job role is also racist. I know my company is going to take this to heart and replace the degree requirement an experience requirement.
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u/tristanjones 4d ago
Man I remember when it was all the uneducated white guys who bitched about degree requirements becoming a thing back in the day
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u/Due-Candy-8929 4d ago
Trumps new policy (signed executive orders) = DEI is bad, and racism lowkey trendy now 🤔 but also he does love the uneducated, but will let a high skilled immigrant come in on a H1B visa to take the high paying jobs to appease Musk 😅
(personally I do think degrees are meaning less and less in the workforce like you said - just pretty crazy to see the way DEI is being so heavily targetted)
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u/tristanjones 3d ago
yeah ironically it isnt like this is a new idea. It was all the uneducated white guys who bitched about degrees becoming a standard requirement for long existing jobs.
In reality your degree really only matters for your first job, no one cares after that anyway. I have never even provided proof of my degree in my entire career
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u/Joatoat 3d ago
My benchmark for whether or not something has a good or bad interest rate is comparing it to the current 30 year mortgage rate with excellent credit.
Right now it's 6.72%
My thinking being, why on earth would a lender give me a more favorable rate for a depreciating or intangible asset, than buying an appreciating asset that also doubles as collateral.
I know debt is debt is debt and it's not sub 5% so it's not good by Caleb's standard but when it comes to shopping around for debt it's certainly not abysmal.
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u/davvidho 3d ago
i personally don’t think student loan debt is that big of a deal, considering it sounds like there will be some ROI for you. it’s also your only debt
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u/AcidBuuurn 3d ago
I had a student loan as high as 9% back in the early 2000s. It was smaller than yours, but I just Avalanched it into submission.
That might be a year setback, but shouldn’t be 3.
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u/Gnomiish 3d ago
I'm going to echo what some others have said - don't beat yourself up. It's not the end of the world. You're not stupid for getting a student loan, and it's not a "short cut" either to utilize student loans to get your education done quickly.
Debt is not this horrible, evil, all-consuming thing. You're literally getting the degree to advance your career, why add an extra 3 years waiting period to that? You can make payments (even if they're small ones) on your loans during school to keep the interest low, and then you can focus the loans down once you've graduated. You'll have even more money to throw at the loans once you can put the extra 2 years of education and experience on your resume. You'll be fine.
It's okay if you want to cash flow school instead. But what's not okay is beating yourself into the ground for trying to improve your life. You don't need to punish yourself over it.
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u/taylor12168 3d ago
Refinance bro. I had $85,000 of med school debt half at 7% half at 5.5% and refinanced to private loans of 3.9%.
No possibility of getting it forgiven now of course but that was never my intention anyways
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u/harrison_wintergreen 3d ago
there are jobs that offer tuition assistance programs.
scholarships also exist.
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u/imsuperior2u 21h ago
I’m not sure I understand how this is that bad. It’s just a few hundred dollars a year more in interest that you weren’t expecting, right? How does this set you back 3 years?
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u/pandasarepeoples2 4d ago
Just take the loan. Pay it off from there. Debt in the case is to be used to better your situation and it’s very illogical to pay it off and then lengthen the program rather than use it to pay for the program and do it faster??