By Zach Petersen
Sooner or later reality will set in – graduation is right around the corner and Uncle Sam will be knocking at the door to collect that school debt.
For thousands of college students, graduates and drop outs nationwide, the lingering student loan is haunting.
Rachel Cruze, daughter of financial guru Dave Ramsey and speaker with the Dave Ramsey organization, often addresses college students about going into debt for school.
“It’s so normal for college students to go through college and have no clue where they’re spending their money,” Cruze said. “They’re not thinking about saving their money; they are kind of just living in the moment. I always tell college students to pay attention. Understand what you are spending your money on and realize the importance of saving. Living on a plan … living on a budget so when they graduate they already have the habits in their financial life.”
College can be a stressful atmosphere and it is good to relax every now and then, but in the end, the goal has to be to graduate and do so without becoming a slave to the lender.
“There’s such a lack of reality in a college student’s mind,” Cruze said. “They’re in college, they are loving it and partying it up, it’s so much fun, they are with their friends and they don’t realize that the reality is that they are going to graduate and they are going to have to find a job and that job is probably not what their dreams and passions are.”
The Dave Ramsey organization encourages students to aspire to get the dream job, but to realize the facts.
“It’s probably not going to be the first job you get right out of college and it’s probably not going to pay what you think it’s going to pay,” Cruze said.
While BYU might not compare to party schools such as Colorado State and the University of Texas at Austin because of Honor Code regulations, Cougars have fun while studying hard.
BYU and other LDS colleges attract students, both in-state and out.
As high school seniors graduate they are faced with many choices — one being which college to choose — the big name school or the local community college.
“Vanderbilt is about 10 times more expensive than the University of Tennessee,” Cruze said. “Is Vanderbilt a better school than U.T.? Yes, probably. But is it 10 times better? I don’t think so.”
Cruze encourages students to attend a year or two at a community college and work their way up to the big university.
“It’s not what your diploma says,” Cruze said. “It’s the knowledge you take out into the marketplace that’s important.”
For many students, working during school is the only way to get by without collecting huge amounts of debt.
Ryan Coombs graduated this past winter with a bachelor’s in business management and a global marketing certificate – all debt free.
“I gave up a full-ride scholarship to Utah State and I was able to get a job and that was a good source of income,” Coombs said. “Then my parents were able to help me.”
Although Coombs has yet to work in his field of study, he and his wife plan to move to Boston this fall to start a life there.
“I am pretty confident that once I get out there I will be able to find a job,” he said. “It’s really people you know that is going to help.”
Another marketing graduate, Justin Taysom, has been working in the field since graduation and has started to pay off his student loans.
“I manage an international business and I’m working in marketing,” Taysom said.
While working through school, receiving scholarships and student loans, Taysom graduated in a little more than five years. Now that he is out of school, he said he plans to have the loans paid off within seven to eight years.
Both Coombs and Taysom graduated with a marketing degree in hopes of entering the field quickly. For others like Andrew Chapman, that final walk with cap and gown is still several years away.
Last year, Chapman was accepted to Pepperdine University in Malibu, Calif., after receiving a bachelor’s from BYU in international relations. He said he plans on getting a joint degree in dispute resolution and conflict resolution.
While attending BYU, Chapman said he was able to keep a tight hold on his budget and grades – which led to scholarships.
“I got a little loan and I think I graduated with $2,000 in debt,” Chapman said. “I also had part-time jobs. I was a TA, a research assistant and I worked as a customer service representative. Working and stuff, I probably paid for 60 percent of it. I probably paid for 20 percent with grants, maybe 5 percent was a loan and 15 percent savings.”
However, Pepperdine has been a different story.
“This last year [in law school], I would probably say 25 percent scholarship, 75 percent all loan,” Chapman said.
The law program at Pepperdine is a three-year program.
“One down, two to go,” Chapman said.
There are many ways to pay for college. Cash-flow, scholarships, grants, loans and help from parents are a few of the options available.
Ann Barrow, a mother of five college graduates, said seeing each of her children graduate from college was a wonderful experience.
“I have always felt that it was important for our children to get a good education so they could be self-sufficient adults and get good jobs,” Barrow said. “We wanted to see them succeed and are very proud of their accomplishments. We’re grateful we had the means to help them.”
Nearly 61 percent of all undergraduate students attending BYU in 2008-2009 received grants or scholarships. Twenty-seven percent received Pell grants and 18 percent relied on federal student loans to pay for school, according to the statistics provided by the U.S. Department of Education.