Let’s Talk About Debt, Part 1: the Real World Economy versus the Grad School Economy

Lauren Does Math and Has a Brainsplosion

I sat down to work on our family budget yesterday and it was… unpleasant.

I am not a math person. I’m not a person who thinks well in this way. I worked extremely hard to get an A in basic college algebra. It takes considerable effort and a lot of repetition for me to do math right, and even then, my brain trends towards the unrealistically optimistic. I’m a “round up” kind of gal. I had been working on a budget for awhile, here and there, using estimations of biweekly payments, etc etc — estimations that I thought were very conservative. But, I was off by about $600, which is a lot of money to “find” in an already dramatically scaled back “Lauren quit grad school and ruined our lives” plan.

I’m not the only one facing the harsh reality of the real world economy, versus the grad school economy. A much-circulated Chronicle article about PhDs on food stamps makes it clear that whether you finish or not, the transition from grad school economics to real world economics is devastating to a lot of people. And if you have the stomach to read the comments, you’ll note that many of them are a variation on the theme of “They got what they deserved” or “How could they be so stupid?” or “What part of ‘loan’ did they not understand?”

And it’s true, it’s insane that we all fell for it and made chronically bad choices when it comes to economics. But, here’s the thing: everyone else was doing it. First of all, insane willingness to take on debt has staggeringly obvious precedence in every facet of American life from the housing bubble to the net bubble to the national debt. PhDs aren’t the only ones being blithering idiots in a culture predicated on getting what you want right now and paying for it, literally and figuratively, later on.

But beyond that, I think in grad school there is a special economic culture; or at least, I felt like I was part of a strange little world in which there were different economic expectations and rules. The sort of unspoken rule I — and many of my peers — operated on went along the lines of, “If I’m going to be paying this debt off for the rest of my life, the amount of debt I’m in really doesn’t matter.”

(I know, it’s a horrifyingly stupid statement. I’m not proud of it, I’m not promoting it — I’m trying to explain something here.)

I came into grad school with undergrad debt: not a lot, but some. In grad school, I accrued an approximate fuckton of additional debt in the form of Stafford Loans. There was simply no other way to do all of these things at the same time:

  • Make adequate progress in coursework.
  • Teach writing half-time, an immensely time consuming task with an income that is good but not great.
  • Pay for childcare, which was our #1 outgoing expense (more than rent/mortgage).
  • Buy Christmas presents; get a haircut; get new tires, etc.

For me, debt was a vicious cycle that we tried to break out of over and over again without success. Every time we swore we would NOT TAKE OUT LOANS THIS YEAR, I’d realize that Hey! I had another freakin’ baby, and she needs a babysitter if I’m going to PASS MY CLASSES this semester and get ONE STEP CLOSER TO COMPS, or if I’m going to GRADE ANYTHING EVAR. And here come the loans to cover that gap between my husband’s salary, my very modest TA income, and our financial needs so I could work, for free, which is basically what you  have to do to make progress in coursework or on a dissertation (sometimes you even pay for that privilege). The further into grad school I got, the more free hours I required to work on research projects, draft conference papers, etc etc. That’s why I never did any of those things: I could not afford enough time for it.

There’s a mentality that if you take out a lot of loans, it means you’ll finish your degree faster (because you’ll have more time), but that has never been true: there is simply not enough time to make huge leaps forward as a grad student while you are also teaching and living a regular life (maybe if you get a fellowship, which is a scenario in which you get paid to do your own research). And once you realize that, it’s too late: your whole life is predicated on that influx of 5k 0r 8k twice a year, and you keep thinking “I’ll finish next year” or “Just one more semester” and before you know it, you’re 100k or more in debt  just like me.

For years, I’ve had a double consciousness about debt and budgeting, because while I lived in the Grad School Economy, I became painfully aware of the Real World Economy (you know: only spend what you earn, debt will crush and destroy you, you must pay for things — that Real World) around the time I had my first grad school crisis. In 2007, I decided to quit my American Studies PhD program and I floundered mightily when trying to determine what to do next. I wanted very very very badly to have a baby, and looking at the numbers for the first time, it was clear that if I didn’t work and we had a baby (or even if I did — see above wrt childcare costs) there was no way to avoid crushing poverty, not to mention we would be without health insurance. Unless… I stayed in school.  If I stayed in school, I could keep a part-time teaching appointment, maintain our family’s health insurance (thank you, grad student union), and be a mother, and maybe work towards some kind of meaningful employment rather than be a clerk at a grocery store (which was my husband’s job at the time, having been kicked out of his own PhD program). So that’s what I did.

But, that first real look at our budget was a painful wakeup and I spent a lot of time listening to the Dave Ramsey Show in the middle of the night while I nursed my newborn daughter. And while I disagree with him in nearly every way when it comes to politics and religion, I found his money logic ironclad, persuasive, and acutely embarrassing. One day, a girl called Dave to ask about buying a new versus used car. She was living with her parents and had over 100k in student loan debt, but she couldn’t find a job because she had a degree in eastern Japenese architecture or something obscure, and there weren’t many jobs in her field. She wanted a new car because she thought it would be more reliable. His response was in a nutshell, “Buy a shitty car you can afford, and get a fucking job.” (Wish I could link to this for you, but I can’t find it!) 

How familiar does that sound? To a person in the Grad Student Economy, it makes sense: she worked hard to earn a degree in a field she loved, she was trying to find a job, and she needed a car. Is it a stinkin’ privileged perspective? Absolutely. So is mine, so is yours: we still believe we deserve a job we love, because we have worked very hard for what we’ve achieved. You can call me stupid for taking out so many loans, but don’t for a secondsay I didn’t work my ass off teaching, tutoring, adjuncting, writing, and mothering for the past eight years. We work very hard in an economy designed for utter failure. And because there is still a lot of smoke-blowing BS in academia — I know it because I was reassured time and time again by professors and friends that despite the abysmal market, surely there would be something for me, surely, at a Community College, or a state school, or anywhere — we would rather believe that it will all work out in the end, and we continue living as if it will and often put off the pain by sticking around an extra year, or whatever. When faced with the Real World Economy of very limited jobs and, even when there are jobs, very limited income, it is a bit stupefying and there’s tremendous mental whiplash.

(To be continued)

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34 responses to “Let’s Talk About Debt, Part 1: the Real World Economy versus the Grad School Economy

  1. AND, I was keenly aware of the “class” of grad school. You know, money for a coffee, maybe a drink or dinner with classmates one night (if I had a sitter, who I had to pay), clothes that looked sufficiently worn but only in that “i am smart and don’t care way,” shoes that fit either the birkenstock, keen, born or dansko model of hippie teacher I was going for (as was EVERYONE around me), and most importantly, the unspoken “we are not poor, we are smart people” bullshit I now struggle to pay for every month. I will never forget an prof telling me, “you need a car? just get student loans and buy one” – yep. Stupid, sure. The culture and all that comes with that – yes! Love your posts.

    • Privilege and class are a huge part of it: there is a lot of privilege, and a lot of desire for class mobility, so I think a big part of grad school is class performance.

    • I regret not spending more time socially with my cohort, but at the time I just couldn’t justify that expense. I did feel marginalized to a certain extent by the social expectations.

  2. Balancing Jane

    Yes. Yes. Yes. I have some debt from grad school, but my husband went to law school and has A LOT. Luckily, we both have jobs in our fields (and I do mean luckily–we’re both hard workers, but so are a lot of other people who were in our programs that didn’t get placed, and I don’t take that for granted). Even so, our student loan debt makes our finances a mess. We LOOK like we make okay money on paper, but those loan payments are taking a huge chunk of our income every month.

    I’m not excusing the short-sightedness of taking out the loans. Maybe if we’d had better insight, we’d do something differently. But I honestly don’t know what that “something different” would be. We were both the first people in our families to even go to college. We had no frame of reference for the debt we were incurring and everyone around us (from our families who had no experience in the matter to our faculty advisors who definitely DID) were telling us that this was the way to get the futures we wanted.

    When I work with students who want to go to graduate school now, I advise them not to go unless they get full funding. Sure, they’re not going to be living the high life on a TA stipend, but they’re going to have rent, food, and health insurance. No one gave me that advice when I was heading in, and I can’t say for sure it would have changed things, but it certainly would have been worth hearing.

    • Brian and I were the first in our families to go beyond grad school. And, even college was SO different by the time we attended, versus our parents’ tuitions and experiences, so they really didn’t even speak to student loans as an issue. We were truly flying blind from the start, and I regret that ignorance. I had a TA stipend for every year, including partial tuition remission, but it still wasn’t enough to raise a family and make progress. I don’t know if “full funding” truly means “full.”

      • Balancing Jane

        Yes. And I think “raise a family” is such an important part of it. In my program at least, many of the faculty members seem to operate on the assumption that graduate students do and will continue to fit the traditional model: full-time students who don’t have outside responsibilities (like full-time jobs and families). It’s absurd, though, because more than half of the students in my program have kids. The old model of a graduate student has shifted, and the way we talk about funding and expectations for completion (like timelines) needs to shift too.

  3. I agree, but I think that the higher ed funding crunch will make the timeline thing a bigger problem. I think there will be more pressure for programs to prove their worth/rigor by improving Time to Completion. There need to be better part-time options for people; also, more people need to not go to grad school.

  4. Hahahaha — full funding. If the only people who attended were those who got full rides, NOBODY would go. When I applied to Vanderbilt School of Nursing this year, I was offered the chance to compete with 10 other people (in an incoming class of perhaps 150-180, if my specialty was about average for cohort size) for one of three full rides (that was full tuition only, not a stipend, so you still have to scare up living expenses) they offered. WHO, I ask you is getting to pay NO tuition AND get a stipend of $17-20K per year for 2-5 years? Only people with trust funds. And that REALLY smacks of elitism.

    And I am sure that bootstrappers would say that this this is whiny, over-reaching-my-priviliege babyish of me, but I do not believe is it right or good or fair or ethical or sane to prohibit people with intelligence, talent, and drive from going to school because of their socioeconomic status. It sucks mightily that many people who are working or middle class and want to become educated and contribute meaningfully to society have to consign themselves to indentured servitude in order to get an education and fulfill their intellectual potential. Really, we should be calling shame on our society for organizing itself this way. I have long thought it a terrible waste of human capital that our educational system takes what seems to be “surplus brain capacity,” smashes it around in PhD programs for years of these people’s productive, energetic working lives, then spits them out the other end with crushing debt, no job prospects, and a “have fun stormin’ the castle.” Why should only rich people get access to education?

    • It’s true, the rich get “richer” in this sense because they don’t have to drown themselves in debt for the PhD. I know someone who knows someone who was perfectly wealthy throughout grad school: he lived frugally but was able to do things like pay for extra travel and research, work on the summers without a job, and move away with his partner when he got a job. He finished his PhD first in her cohort. He doesn’t have a faculty position, but does it really matter? He got the experience and the degree and it will still all be profit for him no matter what job he works.

    • Balancing Jane

      Katherine, I completely agree, and I hope my comment about full funding wasn’t construed as saying I don’t think that people without economic means should go to graduate school. In fact, I’m the coordinator of a program designed to help underrepresented, first-generation, and low-income students go to graduate school, so when I say I counsel students not to go unless they get funding, I’m talking about students whose only alternative is crushing debt. I ABSOLUTELY believe that everyone should have the opportunity for education that matches their abilities and passion. At the same time, I think it’s irresponsible of me to tell my students that everything will be fine if they take out the loans. Instead, I’ve always focused on making sure they apply to multiple programs (and our program offers fee waivers, so it makes that more feasible) and to make sure they’ve had opportunities to make them excellent candidates (research experience, conference presentations, etc.) Most of the students I work with do get funding (stipend, tuition, and health insurance). A few do not. Some try again the next year, and some decide to take out the loans and go anyway.

      And that’s for the students who are in this program and get those opportunities. We serve 25 students a year and we’re grant funded–and at risk of being cut. What about all of those other students who don’t get that chance? It’s absolutely not fair, and it’s depriving the academy of (much needed, in my opinion) diversity of perspective.

  5. I currently only have an undergrad (obtained over 10 years in a combo of full time/part time working the whole time enrollment). After reading this, I was surprised to realize that I am certain that I thought people in undergrad were insane for living on their student loans, using them to buy new wardrobes, new cars etc, I have never thought that about people in grad school. So even from the outside looking in there is an illusion that living on loans for a master’s or PHD will pay off. On the other hand with my degree I currently work one cubicle over from someone who has 100K + in debt because she lived on loans for her Bachelor/Masters in Sociology. She makes marginally more than me only because she gets a tenure bonus now that she has been with the state for 4 years. And I do mean marginally because we don’t get cost of living raises or merit raises. She may have more job opportunity when she decides to leave as a result of her degree, but I am not sure if that outweighs the financial burden she chose to take on.

    • Considering how many years it will take her to pay it off, versus you, I’d say it definitely won’t pay off. But, it’s interesting to hear that even to an outsider, there’s a different perspective on debt for grad school vs undergrad.

  6. I remember trying to explain the loans to T when he first moved in with me. He was absolutely incredulous that I had access to all this money that was ostensibly for school but that we could actually use to buy a futon, or Phish tickets.
    I don’t exactly regret the loans; I am grateful that I got out before the govt turned it all over to Sallie Mae.

  7. I think too that a majority of people took out loans for education and living expenses while earning advanced degrees because they figured that they would have jobs when they graduated. Crazy idea, no? As one commenter said, even having jobs in your field does not make crushing student loan debt easy (!), but it really sucks to take out 100k to become a lawyer and then find you cannot land a law job that would let you begin to pay back your loans while still paying rent, buying food, etc. In fact, Dave Ramsey’s advice to “get a job” oversimplifies the reality of people HAVING to remain un/under- employed because no entry-level job would allow you to pay your loans! Getting that entry-level job can take away your ability to defer the loans which you still can’t afford WITH the job! It’s infuriating.

  8. I think Dave Ramsey misses the mark about student loans for undergrads as well: he is always advising students to go part time and work a bazillion hours per week so they don’t have to take out loans, but in my experience, these students end up disconnected from exactly the campus and faculty networks that might actually get you a job after you graduate. If you want to be a stand-out student at a university like the one I teach at, you need to be able to commit time to building relationships with faculty mentors, doing research for Student Scholars day, studying and doing service abroad, etc. Part time students don’t typically make these connections or have these experiences. They might graduate with fewer loans, but they also graduate without the kind of mentors who can write a really good letter of rec or leverage their networks for a job or internship opportunity. The endgame of undergrad isn’t just the degree– and loans might be a small price to pay for the networks that create actual opportunities to use that degree.

    • I agree — I did a TON of research on student success in college before I left grad school, and it all pointed to a sense of identification with academics and school that requires a relationship with campus/students. It’s much harder to cultivate that commitment and connection as a part-timer (as we witness at Comm Colleges, where attrition is HORRIBLE).

  9. Great post. This is really tied in with the series about privilege that I’ve been periodically running at my place. Rich students never have to worry about debt and can still afford all of the expected things that a grad student is expected to have – a nice laptop, stylish “academic” clothes, trips to conferences, nice wine and hors d’oeurves for dinner parties where we discuss arcane academic theories, etc.

    The rest of us are told that we can “just take out loans!” And since there is no understanding of the bleak job prospects we face upon graduation, we can never envision a time when we’d be out of school but WOULDN’T have that high-salary job we assumed we’d magically get, where we’d be able to pay off our loans in no time.

    It’s always driven me crazy that grad students are encouraged to NOT find part time jobs outside the academy (and are sometimes directly forbidden from doing so), but are encouraged to just take on piles of debt instead.

    Also worth noting: the academy likes to complain a lot about the “time to degree” problem, where it’s taking students longer and longer to finish up and graduate. Well … on top of the increasing workload of grad school and the increasing expectations of what we’ll have on our CVs when we graduate, I’ve long assumed that this debt is part of the cause of the lengthened time people spend in grad school. Why graduate into a crappy adjunct job when you can hang on in school for about the same amount of income … but NOT have to pay back your loans yet? It’s a logical solution to a huge problem. Yet all we hear about is how today’s students are “lazy” and “won’t graduate.”

    Well, perhaps if grad programs would pay its TAs better and would help them get actual jobs after graduation (rather than just punting them off to another low wage employer), the situation would correct itself.

    Grrrr. Needless to say, I have a *lot* of thoughts about money and debt in grad school.

    • The problem with outside, PT jobs is that they DO slow you down dramatically. I just don’t know if there’s room for academic work and paying work to be side by side! And I do know so many people who hung on for another year (or more) waiting for the academic market to improve, so they could keep health insurance, etc, instead of making a pittance as an adjunct.

      • Forgive my looooong comment. I have more to say, but I think I’ll just respond on my blog later this week. 🙂

        Suffice it to say: I worked 20 hours per week for the last four years I was in school. I taught during 3 of those years. And while I never officially finished up, I was on track to defend my dissertation on the same schedule as 2/3 of my cohort.

        I just don’t think that it’s true to say that a job will always slow you down. I know that for me, it actually helped structure my time better so that I was actually more efficient at completing my academic work.

        But regardless … in an era where few of us can survive on a grad stipends and where we’re lamenting the piles of debt we’re all graduating with … and where there are NO JOBS when we graduate anyway (so what the h*ll are we working so hard for???) … I really don’t think that it’s a bad thing to encourage grad students to at least consider working a few hours per week outside of the academy.

        Also – I really balk at the idea that most grad students are really *so* busy that they can’t take on any additional responsibilities. Most of the work is self-created due to the insane demands of academic culture … and let’s not pretend that a lot of grad students don’t waste hours upon hours in procrastination and Facebook browsing. I know that I did.

        There are certainly some people who legitimately couldn’t take on another job … but to dismiss it full-stop or for departments to outright forbid it is, I think, a huge problem that’s contributing to the financial and personal disaster that grad school turns out to be for a lot of people.

        More later at my place. 🙂

      • I don’t dispute any of these points — I agree that having commitments other than school helped me structure my time better. And I worked at multiple jobs outside my TAship during grad school, including babysitting and extra teaching. But, I struggled to balance my many commitments with things like my family. I taught, worked, and attended class during the day: I did homework at night and on weekends. Oh, and I squeezed in time with my husband somewhere in there. Having kids dramatically challenged this even further. I am going to follow up on this post today or tomorrow with more details about how the time crunch made it very hard to make enough money to have time to make progress on school. This is definitely a situation where being a grad student with children might be different than being a non-parent. I look forward to reading your response!

      • Yeah … one thing I was thinking as I was typing this comment was that the postac blogosphere might benefit from a discussion between those of us who have kids and those who do not. Because despite my lengthy comment about how valuable I think outside jobs can be for some people, I know that there’s *no way* I could have done all I was doing if I’d had kids.

        But then again, there’s no way I could have afforded to have kids on my grad stipend alone. Really, the whole thing is just a big scam.

        More later this week… 🙂

  10. I do not CURRENTLY teach or CURRENTLY work, and we do not CURRENTLY use a daycare, beyond modest, part-time preschool programs. I was describing a scenario for graduate school students (a scenario of my past), who must have ample free time to do academic work, as well as teach and balance family life. That available work time requires childcare, which is expensive. My problems are not at all related to laziness. Your problems are related to reading comprehension. Slow down and actually read what I wrote: it makes more sense that way, and makes you sound like less of an ass.

  11. “Mothering by Default”:
    “At heart, I am lazy, even when it comes to things I care about.”

    “I’m not a great housekeeper or cook. I do not have the patience, persistence, or disposition for many domestic tasks. Knitting has too much math. I get bored and frustrated at home. I certainly don’t do enough housework well enough to earn the $18/hr we pay a local woman to clean our place on Friday afternoon.”

    You pay a cleaning woman. Get over yourself and get a job. Or at least stop complaining about money when you pay someone else to raise your children and clean your house. Good luck with your blogging. I would not be surprised if someone else is cleaning your house and watching your kids while you post bitchy, self important blogs on the internet. Mama Neurotica would be a more apt title.

  12. Pingback: Let’s Talk About Debt, Part 2: The Catch 22 of Grad School Economics | mama nervosa

  13. Pingback: What Lauren Learned About Identity & Work via a Craft Disaster (aka “Do it, start it, FUCK THIS IT’S NOT WORKING!”) | mama nervosa

  14. This doesn’t sound so different from undergrad really. Taking out loans is worth it (we think) because it will pay off in the end. I guess this is true to a point. It’s hard for me to find a teaching job after doing the education to be a teacher but at least I have the opportunity to get one. It’d take me a long time to save up enough for a degree working at minimum wage jobs. On the other hand, now there’s interest for loans.

    • It’s true that the mentality is similar, but the amount of debt is so much higher and the potential payoff so much lower. Grad school has a sort of marines mentality (the few, the proud) and I think the level of delusion about money is a lot higher than it was (at least in my experience) in undergrad. Most of my friends and I worked other jobs as undergrads: very few people I know in grad school worked outside academia, and we were actively discouraged from doing so. I think it’s similar, but to a more damaging extreme.

  15. I think part of the problem is the myth that school leads to some sort of destination…that you’ll be “finished” somehow, and end up where you’re “supposed to be” making “money” while doing something that you “love”…so you keep going to school in order to chase that unicorn, and grad school just helps you keep up that pretense of finding a hyperspecialized niche and eventual satisfaction with your life. After going to a private college and finishing with a double major in practically useless fields: English and Philosophy. Yadda, yadda, ‘English degrees are SOOOOO useful, people know you can COMMUNICATE’…Total B.S.

    You know how people know you can communicate effectively? By experiencing you communicating effectively. It has nothing to do with your English degree. There are so many English majors who can’t string a sentence together correctly nowadays that you cannot count on an English BA to proofread simple ads and make some freelance cash. Let’s not even talk about how useless a philosophy degree is unless you sign your soul away to higher education ethics position at a large energy corporation, but dream on if you are trying to compete against others with those special 3 letters after their name, P, H & D, because they are more in debt than you, they’re hungrier than you, and look better on paper.

    After college, and working, and paying student loans, and being a stay at home mother, I have realized that I will NEVER go back to school unless what I’m learning will do me good if the zombie apocalypse is nigh, and I think it’s worth the cost to get some real life skills out of it. Midwifery, here I come. I’m not going to buy into the illusion any more. I’m in for a revolution instead, homesteading, getting back to basics, and putting one foot in front of the next. I used to have so much respect for intellect and abstraction and the ivory tower, with plans of a masters degree or doctorate…Not anymore.

    Years and years of living lean, with mouths to feed and debt always at our heels–that changes dreams.

    • Leslie, I agree that a lot of the discourse in grad school is tied up with the whole notion of finding work you love or what fulfills you. For smart people, people who do VERY well in college, grad school often seems like the ONLY path to fulfilling employment.

  16. his was brilliant. We are struggling to maintain a budget and we have a 70k income. It seems ridiculous to both of us that we are stretched so thin, even though other people in our income bracket seem to be doing much better. I think, for us, the debt culture is compounded by the fact that both of us have terrible examples in our parents (sorry guys), who are all (except my step daddy, who is Scrooge) broke as a joke. And not a degree among them.

  17. I didn’t finish any of my degrees, but as a Nanny for five years I made MORE than I would have as a music teacher. And now my husband is taking care of my loans, since I quit my nanny job [which was part time at this point, anyway] to be more present with our kids. Once they’re a littel bigger, I’m going to start working on gainful employment again, but I’m thinkin Etsy store, joining a Jazz Band or Beauty School [which we will pay for out of pocket]. I still need to say home with them. As for their college, it’s in the budget. They will not get a car when they turn 16, but they will have their education costs in the bank. I don’t want this to happen to them. I’m starting by teaching them about financial responsibility, and finishing by giving them the best start to adulthood.

    • Thank you, Erin. I heard a clip on NPR that financial literacy is hugely influenced by parents, especially if parents include kids in discussions about family finances. I don’t expect to pay for my kid’s college careers, unfortunately: I don’t foresee being able to create those kinds of savings while we are paying off our grad school debt.

  18. Pingback: Let’s Talk about Debt, Part 3: Debt & Regret | mama nervosa

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