I don’t think we have a student debt crisis so much as an entitlement crisis. There used to be a time when paying back your debt with interest was done with honor. There would be no complaints, but simple gratitude for someone or some organization willing to take a risk on you.
Nowadays, it seems like there is a growing movement of folks who believe there should be debt forgiveness just because. Just because what? Seriously, please tell me or write a guest post explaining why you are entitled to free money.
Being a debt welcher demonstrates bad character. If you’re not willing to scrub toilets, drive a car, get up at 5am to work extra hours, or flip burgers to pay your debts or get out of a bad financial situation, then you are going blame the world for your problems until you die.
HOW BAD DO YOU WANT FINANCIAL FREEDOM?
Here’s a comment from the Average Student Debt At Record High post I’d like you to read.
I went to a private college and got a BS and MS in engineering that left me in $88K of student loan debt upon graduating. This would have been more, but I was working multiple jobs throughout college to afford the $40K/yr price tag. Like some others have said, the FASFA really screwed over my family because it valued their house at an insane amount even though they had a substantial mortgage. I’m pretty sure it also looked at my parent’s retirement accounts as assets that could be liquidated, but that was not an option.
Anyway, after graduating with $88K in debt, I continued to work 2, 3, 4, and even 5 jobs at a time to make as much money as possible. My first real job started at 50K but has risen to just over 100K in six years. Even though I am making this money now, I am still working side hustles to make extra money, and can easily make an extra $2-300 a week with minimal work from home, mostly through websites like fiverr, crowdsource, and other freelancing platforms. Sometimes I still help out at a friend’s restaurant waiting tables and can make $2-300 in a night!
On top of this, I also went back to school while doing all this work and got a professional degree in an unrelated field that is going to allow me to open up my own business on the side. I’m hoping that this will net me around $10,000 extra each year.
The thing that really resonates with me, though, is how few people are willing to put in the time, and to make smart life choices so that they can reach financial independence. With all this work, I was able to pay off my $88k in loans and finance a professional degree without taking out any new ones.
I also bought a house and have a very reasonable / manageable mortgage payment. I save roughly 20% of my income for retirement when you count the employer match. And, I still can go out for nice dinners, go to sporting events, go on a week or two of vacation each year, go to shows, have nice clothes for work and casual events, drive a decent car, and afford home improvement projects on my house.
Every time I hear some sob story about people who are stuck in debt from student loans, I also hear stories about how they waste money on useless wants, go on extravagant vacations they cannot afford, eat out at fancy restaurants for every meal, and sleep-in every chance they get. They never tell us they are working a second job, or how they are trying to save up for something. Instead, they are racking up credit card debt on top of student loan debt, complaining about it, and not thinking about the future at all.
We really need people in college and recent graduates to be more responsible for their own decisions. I think that is where the solution begins.
By working multiple jobs through college, multiple jobs after college, waiting tables while making $100K at his day job six years later, and diligently saving 20% of his income, it’s clear this commenter WANTS to get ahead. He’s not somebody who complains why he can’t get ahead while working less than 40 hours a week.
I’ve highlighted Sean Cooper’s story about how he put his life on hold for three years so he could pay off his mortgage early. No sex. No fine dining. No fancy car. No travel. No main house living. Lots of extra freelance work. And now, no mortgage debt. Sean wanted to get ahead, so he did it. Are you willing to make the same sacrifices to pay off your debt?
The benefits of financial freedom sooner more than outweigh loose spending today. I could show you pictures of how awesome life is once you have absolute freedom, but that would just annoy you or make you feel bad. Hence, all I can do is just continue to write and share some examples of doing what it takes.
ONE MORE EXAMPLE OF HUSTLE
In the post, Larks vs. Night Owls, another reason I decided to drive for Uber between 5am-7am was to get its year-end $750 bonus after 20 rides. You see, Uber ran a special last December where referrers would get a $750 bonus if they signed up a new driver (from $300 usually), and the new driver would also get a $200 bonus for a combined bonus total of $950.
Based on my 400+ ride experience, I knew I could do 3-4 rides an hour. In other words, after 6 hours of work, I could capture a $950 bonus + ~$200 in fares for a total of $1,150. That’s an hourly rate of $192, while also being able to do research on early birds for my post. A $192 hourly rate equals $33,280 a month, and $400,000 a year if maintained for 40 hours a week. Not bad, if you take advantage of the various opportunities. So many people are making way more money than anybody knows through side hustles.
What’s interesting is that I gave my referral code to three friends, and none of them bothered to sign up to earn extra money, even if I told them I’d split the proceeds. All have nice cars (VW GTI, BMW 535i, and Porsche Cayenne), but none of them can afford a median priced single family home in San Francisco. Their house-to-car ratio for measuring fiscal responsibility is out of whack!
They bitch and moan about the cost of housing, and one of them would rather let three of his doubles players wait for 45 minutes because he didn’t want to pay $3.25/hour for parking! The person who did accept my referral code was my business partner. And she was smart to make me drive for her while she collected her $200 bonus for just being.
I’ve come to the conclusion that too many people are either too proud to make extra money, too lazy or simply don’t have the money making DNA in them to get ahead financially. Unless you have some physical or mental malady or come from a broken family, it’s hard to except so many excuses when there’s so much opportunity now.
Remember this: It takes effort to see the sunrise.
DON’T DO NOTHING
Please don’t complain when others buy nice things, retire early, travel abroad, and live in fabulous places. Chances are high they earned it. They stay on top of their net worth and work towards a financial plan. You should sign up for Personal Capital for free. Not only can you track your net worth, but you can x-ray your investments for excessive fees, and run cash flow simulations for retirement.
Every single goal achiever put in plenty of sacrifice. If you want to be free, put in the extra work today, and every day until you get there! If not, I guess you can blame me or Obama. But blaming won’t get you anywhere.
Start your own business/website: If you feel you’re not getting paid what you’re worth and want to boost your income, start your own business online on the side! It used to cost a fortune and a lot of employees to start your business. Now you can start it for next to nothing with a hosting company like Bluehost for under $4/month and they’ll give you a free domain for a year to boot.
Brand yourself online, connect with like-minded people, find new consulting gigs, and potentially make a good amount of income online one day by selling your product or recommending other great products. Not a day goes by where I’m not thankful for starting Financial Samurai in 2009. Here’s my step-by-step guide to for how to start your own website like mine in under 30 minutes.
Updated for 2019 and beyond.