I remember talking to a co-worker that had worked in a financial aid office. She said to NOT wait to pay back student loans! That they would wait, allow interest to accrue, apply fines and penalties and fees and wait some more. Then they would come after you with a vengeance. That was 7 years ago.
I remember the MidAmerica Nazarene University recruiters coming to my church, into my youth group, into my Sunday School class. I had felt called to ministry, to preach, to pastor a church. But neither I nor my family could afford to pay for me to go to college. I had no idea how I would afford to go to my church college that would train me for ministry and prepare me for pastoring. But the recruiters had an answer: Financial Aid, student grants and student loans. That was 16 years ago.
Now my wife and I have 2 student loans that are about $100,000 apiece. I have never been able to enter into ministry for many reasons, one being that no church would ever be able to afford to employ me where I could pay the school loans back. I’ll never forget the speech that my church history professor gave my junior year of college. He said, “75% of all Nazarene churches are 75 people or les. So if you have more than $5000 in loans the average church won’t pay you enough to pay them back.” Thanks prof. Williams. Why didn’t YOU visit my youth group?
I remember filing for bankruptcy. The bankruptcy judge asked if I had a doctorate with that kind of student loans. “Nope,” I replied, “I went to a private, religious college.” The credit card debt went away, but student loans are not easily forgiven in bankruptcy so the loans did not go away. That has been well over 8 years ago.
Now, for some reason, the US Department of Education wants their money back…and they want it pretty bad. I may be a day away from having the US Dept of Education garnish my check, @15% of my disposable income per paycheck for the rest of my life. Interest will still accrue. And that is only for one of the two loans.
In addition, the state is currently garnishing my check and my wife’s check to the total of 25% per person, per check. It is for a medical bill. We won’t be able to pay rent this month. We both have pay day loans out. We have one maxed out credit card. I have 2 401K loans that I am repaying. As I write this, my bank account is negative.
There are a few positives. I have a great family. I have 4 boys. I have a great job. So does my wife. I am taking steps in the right direction. My good friend Bill is acting as our financial counselor, he has been great to keep us focused and encouraged-he even paid for my wife and I to attend Dave Ramsey’s Financial Peace University classes. I have stopped my 401K contributions. No cable. No Internet. Of course it is because we owe them too. I plan to reduce the cell phone plans to the next plan down. We rent, but both of our minivans are paid for. I changed my tax exemptions to get more money back during the year instead of a refund The federal gov’t will take that anyway). I have been taking my lunch to work instead of eating out. One pay day loan is paid off. I have 1 401K loan that will be paid off by the end of the month. I won’t be giving to United Way next year. I have even applied for several part-time jobs and my wife has been taking extra duties on at her school-that will be extra money too. I have been in contact with the people I owe, trying to make a plan and trying to take control and be responsible.
And of course, I participated in my first Dave Ramsey class last night.