One Card Down and the Terrible-ness of Student Loans

Logan: I just impulse paid off one of my cards. Haha. The balance was $300 and I owed $100, and so I just paid it off. Wild and crazyyyyyy.

Mike: Congrats! You should also close the account now. You have other accounts open, so it shouldn’t be a big deal, and also, you’re not looking to apply for a mortgage soon.

Logan: That is a true statement. There has never been a truer statement.

Mike: YES

Logan: I mean, I guess technically I should have put that extra payment towards the J. Crew card, which I picked first because of high interest, but i just wanted to be done! It was right there and I TOOK IT.

Mike: No, you’re snowballing instead of avalanching, which is good.

Logan: I’m flurrying. I’m wintery-mixing

Mike: Haha, yes, you’re doing your own thing.

Logan: Marching to the beat of my own drummer. Flying my own flag. Whistling my own tune.

Mike: All aboard the Logan train! Destination: No more credit card debt!

Logan: Okay, let’s talk about you. I know you’ve explained how you paid for grad school, but have you explained how you paid for undergrad? It’s been interesting to read how people paid for school. 

Mike: Nope. Not yet. So for undergrad, I had some scholarship money, and I took out loans and worked on campus to cover the rest.

Logan: How does one take out loans as a high schooler?

Mike: Haha, well you fill out the FAFSA form. And then if you come from a lower middle income family like mine, you’re given financial aid, and loan options. And you look it over, think it over, and then sign the paperwork. Most of the loans come from the federal government and don’t require a co-signer. Others—private loans require a cosigner, but you can work around that. Usually your parents cosign. But mine didn’t, or couldn’t. So to borrow, I had to pay a small penalty.

Logan: Haha, whaaat? Like what kind of penalty?

Mike: So, with some private loans, if you can’t get a cosigner, they will sometimes offer you another loan that doesn’t require a cosigner, but those loans come with a higher interest rate. Or they’ll tack on a fee at the top, which is what happened to one of my loans. So for example, on a $5,000 loan, if my parents cosigned, I would just be given a $5,000 loan and would pay it back with interest later. But without a cosigner, the penalty was a few hundred dollars on that loan, so I would have to pay back something like $5,300 on a $5,000 loan. That $300 was added on the top right away, so I had to pay interest on that too.

Logan: That’s wrong. I find that to be wrong.

Mike: Haha, YUP. Student loans have a lot of terrible aspects to them. I mean, having to pay a penalty or a higher interest rate because your parents can’t or refuse to cosign for you is just not right. Students have a lot more trouble with private loans than they do with federal ones. Like, way to make things financially harder for people who have things financially hard! It all seems very backward.

Logan: Srsly. Okay I’m looking for a picture to illustrate this. MOVIES ABOUT STUDENT LOANS. Not getting a lot of hits here. Did Felicity take out loans to pay for school?

Mike: Haha, I’m not sure. I mean, she did work at Dean & DeLuca, but I don’t remember if she was working there to pay for school.

Logan: I think Ben was? And that’s why he lived off campus because it was cheaper? I JUST DON’T KNOW. Okay I just read an entire series synopsis of The OC and I don’t think any of them took out loans either. I bet someone had to on Saved by the Bell. 90210? Dawson’s? According to the Internet, one of the characters on 2 Broke Girls had student loans. But then they had a party and paid them off with the proceeds. Because that’s realistic.

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33 Comments / Post A Comment

lrodrigue (#1,315)

i moved to new york hoping my experience would be just like the one depicted on two broke girls and it’s totally NOT.

kellyography (#250)

@lrodrigue I watched like two episodes of that show and could not handle what a wildly unrealistic portrayal of New York it was.

CubeRootOfPi (#1,098)

Congrats on the credit card, Logan!

sockhopbop (#764)

Yes, congrats Logan! Also, weirdly specific Felicity memory: At one point her father stops paying her tuition because she’s decided to major in art instead of being pre-med, and she’s going to pay for tuition by putting it on her credit card. But Noel stops her because of the crazy interest rates and fronts her the tuition money. (Maybe he inherited it? I’m not sure but he has a big windfall.)

WaityKatie (#1,696)

@sockhopbop I remember that, and also remember at the time being like, “they let you pay your tuition with a credit card?” Is that true?

Fig. 1 (#632)

@WaityKatie You can in Canada! It is just as bad of an idea as you think it is (unless you are paying it off at the end of the month and just want reward points.)

Brunhilde (#78)

@WaityKatie Yes it’s true. Or it used to be ==> at least $10,000 of my credit card debt.

WaityKatie (#1,696)

@Fig. 1 Soooo many reward points!

sea ermine (#122)

@WaityKatie They definitely do. I remember my parents payed some of my tuition installments with a credit card because it was a rewards card, so they got like 2% off the tuition. Which isn’t much but still. This is only an ok thing to do if you can pay it off right away, or else it’s like a student loan with insane interest.

elizabeast (#629)

@sockhopbop Noel got the money from when he married Javier’s sister. She needed to get married so she could be eligible for an inheritance and she tricked him into marrying her. But then he had one of his classic Dubious Morals moments and decided to stay married for the required time, and in exchange she gave him like $60k.

WaityKatie (#1,696)

@elizabeast Oh my god, I need to netflix Felicity and watch it again, like, now.

@sockhopbop im so glad you know this

@elizabeast remembering this fact is a true talent

Nick (#1,548)

RE: Student loan movies/TV shows — Part of the initial premise of Gilmore Girls was Lorelai borrowing money from Richard and Emily to put Rory through Chilton… Does that count?

Bill Fostex (#573)

SUPER PROUD OF U LOGAN SUPER PROUD

Dancercise (#94)

Congrats, Logan! (Mike, are you going to write her a congratulatory note?!)

ghechr (#596)

Great job Logan!

Megano! (#124)

Congrats! I hope you yelled “SUCK IT!” as you paid that last $100.

Bill Fostex (#573)

@Megano! HAVE U MET LOGAN!?!?!? I BET SHE YELLED SOMETHING THAT INCLUDED THE WORD “MOTHERFUCKER” AND THEN MADE SOME UNIMAGINABLY LEWD PHYSICAL GESTURE! SHE’S THE GG ALLIN OF THE BILLFOLD! AND DANG IS, LIKE, THE MATTHIAS REIM!

blueblazes (#1,798)

LOGAN wins Friday!

@Mike Dang I’m a little obsessed with your very first response. Cuz, like, what if you ARE looking to apply for a mortgage in the near future? What then? Close no accounts of any kind? I feel like my credit score is a toddler that I am leading through a minefield.

WaityKatie (#1,696)

Everyone on tv is rich, which is why they don’t have student loans (and also why they all have beautiful apartments in NYC).

bibliostitute (#285)

@WaityKatie or they are happily, humbly poor, but rich IN SPIRITUAL GOODS

WaityKatie (#1,696)

@bibliostitute It’s true, The Poors are invariably more in touch with What Really Matters. So, don’t feel bad about the way things are, you’re really better off not having all that nasty money to corrupt you!

bibliostitute (#285)

@WaityKatie i wouldn’t even know what to do with lots of monies! I would just put it under my bed.

Nice job, Logan!

Fig. 1 (#632)

Yes! Everyone is paying things off this week! My circle of acquaintances include a paid-off mortgage (& subsequent burning party) and a car loan. Debt: in retrograde.

ennaenirehtac (#199)

Huzzah, paid-off credit card! Hearing about paid-off debt is almost as good as watching them clean up the houses on Hoarders. Going to schedule some payments of my own!

Yes, everyone on TV either gets their parents to pay because they are “rich” or gets a full ride scholarship to Harvard because they are “smart.” Those in the middle are not sufficiently special to get TV shows made about them, apparently.

kellyography (#250)

Also yes, amazing job, Logan!

HOOOOORAAAAAY LOGAN!! This is marvelous. I am so proud of you!

Question regarding CC debt: I had/have a lot of credit card debt (max amount was $43K) due to medical bills. I got reimbursed by my insurance company for about $16K of that and used it to pay off the MRI/anesthesiologist bill to the tune of $12K. Does that still count? I mean, can I celebrate here publicly for paying off a card?

I’m still going to celebrate winning the third appeal on my bill; the insurance company denied payment unreasonably, and it took me two years to change their hive-mind. Still. . .can I have two glasses of champagne instead of one?

Fig. 1 (#632)

@Mingus_Thurber Yes! Any progress is good progress. But hold off on the strawberries.

Congratulations on the big step forward, Logan!

I’m racking my brains thinking about TV shows with student loans, and I can’t think of any depicting undergrad loans, but I know Marshall on How I Met Your Mother had crazy law school debt and most of the characters on Scrubs had med school debt.

Trilby (#191)

There is a difference between credit cards and student loans. As you pay down your credit card, your minimum payment goes down. I want to pay off my student loan, but I won’t feel the good of it till the very last payments gets made. In other words, it doesn’t benefit me as I pay it down in any way. It doesn’t free up credit, it doesn’t give me wiggle room if I can’t pay extra one month. Plus, my rate is much lower than all my other debts. BUT the payment amount is a burden. So, what to do, what to do… My plan is to pay it off all at once when my ship comes in.

Lily Rowan (#70)

I finished paying off my undergrad loans this weekend! It took a ridiculously long time because I refinanced when I was young and broke, and deferred when I was in grad school, etc., etc. Now I just have grad school to finish paying off! And credit cards.

But still: One down!

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