I screwed up in college. Big time. I was encouraged to explore my passions and enrolled in exploratory courses whilst not pursuing a degree, at a very expensive college in New York. I didn’t understand or appreciate how much my education was costing (until it was far too late). For a combination of reasons (both financial and feeling generally lost) I switched college three times. I was about to give up on my education altogether, but a 60+ hour / week job detailing cars, witnessing forty-year-olds living paycheck to paycheck, encouraged me to keep at it.
Long story short, I had, by my early twenties, put myself into $77k principal college debt. I was enrolled in “Interdisciplinary Studies” at a university in Chicago, IL, with two years left to go until graduation, having already been in school for three years. I was exhausted, and I felt like failure.
In desperation I began taking active steps to turn things around. Among all the actions I took to improve, there are three very specific actions which were the most impactful in making many things in my thirties possible.
Short-Circuiting College (ie Tuition)
At the time, I was working a student job in the Interactive Multimedia (IM) department where I tutored students in the IM lab. I had grown a good reputation, and the chairman of the IM department knew me. I’d decided I wanted to pursue technology, primarily software and web development (Software / Web Development and UI Design were the primary focuses of the IM program).
The problem was that switching again would mean graduating much later, and I wanted to graduate in less than a year. So I approached the chairman of the board and asked if she’d let me bypass any prerequisites barring direct access to senior-year IM courses required for graduation… And she did. Her signature let me enroll in the classes I needed and I completed them all in one semester, graduating early thus saving a ton of money on tuition.
Student Loans: I Didn’t Go With The Flow Set By The Banks
After graduation I had a handful of student loans via the government and three private loans. I sat down with a pencil and paper, tracked all of them down, and calculated how much I was going to have to pay each month.
When the bills started rolling in, though, the payments due on each loan were much smaller than what I’d calculated. I assumed that I must have been wrong in my calculations, and I paid the amounts due. Then, the next month when I got my new balance statements, the loan principals had all increased. So I called the bank and asked them why.
It turned out that I was on an “extended repayment plan”, which all students were put on by default due to the assumption that entry-level salaries could not cover the payments. Fortunately for me I had landed a job in IT with a decent salary. I terminated the extended repayment plan, and then a few months later began overpaying the highest-interest loan in an attempt to pay it down faster.
Which led the next problem. I expected the principal for the overpaid loan to shrink faster, since I’d overpaid, but the statement showed it hadn’t. Not only that, but I had $0 due for the next month. So I called the bank again. The lady on the phone said they didn’t apply the extra money towards the principal – they’d just advanced the payment. Which meant the principal wasn’t touched by the additional money and interest accrual against me was as though I’d not overpaid at all.
“I want to apply the extra towards principal, like any other simple interest loan,” I argued, feeling as powerless as I had in college.
“I’m sorry, but we don’t have any means to do that,” I recall the lady telling me.
We went back and forth for a while, after which I was transferred to her manager. Finally we settled on a custom situation in which I would send in a dated, hand-signed letter with each payment, stating that any additional money was to be applied to principal.
Each month for over a year I printed out those letters, signed them and sent them in with my payments via snail-mail because there was no other means to accomplish this. I had a template which read “Please apply the additional money to the principal for XXX account.” It was a complete pain in the ass and occasionally it didn’t work. (Fortunately some legislation changed this around 2010).
Doubling My Salary Overnight
I was working as a systems administrator for a small company outside of Washington DC. My salary was okay, but it could have been better. I sat down the hall from our recruiters, and frequently heard about their troubles finding qualified network engineers.
Then one day my boss joked that if I’d get my CCNA and get placed on one of those jobs, he’d double my salary. So . . . one morning about two months later I walked into his office and put my newly acquired CCNA certificate on his desk, and kindly reminded him of what he’d said. Three weeks later I was on a contract with a much fatter paycheck.
The Takeaway ?
Don’t sit back and just let life happen because you’ll just end up making everyone else around you rich. The system’s designed to make a profit off you – not to benefit you. Even just being aware of this fact can help subvert a lot of the damage it can cause you.