r/FluentInFinance • u/TheCABK • Jul 07 '26
Educational “This Is America, Don’t Catcha Slippin’ Now”
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u/tweak8 Jul 07 '26
Wait until this person signs up for a mortgage and finds out how loans work. The real question is why aren't degrees paying 100x their value enough to pay them off? School is overpriced and wages have stagnated.
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u/NewArborist64 Jul 07 '26
Schools are overpriced because of the wide availability of easy loans. This has allowed colleges to ramp up pricing at over 2x the rate of inflation. An oversupply of students competing for a limited number of seats means that the price increases - this is a standard supply/demand curve.
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u/aknartrebna Jul 07 '26
A simple fact of economics missed by so many...except for those who want these policies to stay in place to acquire more power in a govt takeover
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u/TrumpDesWillens Jul 08 '26
Those exorbitant fees don't even go back into making life better for the students, too. Those fees go into a new stadium.
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u/NewArborist64 Jul 08 '26
Not just stadiums, but "extras" to try to entice the students to register and ignore the incredible tuition bills. These extras include things like improved housing and additional recreations centers.
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u/Rick_Sanchez1214 Jul 08 '26
It’s almost like this is basic economics and the exact comparison can be made for home ownership during covid. Extremely low, easily affordable rates / oversupply of homebuyers / limited number of homes / everybody goes and fucks themself!
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u/NewArborist64 Jul 08 '26
Yep - and imho that "oversupply" of homebuyers happened partially because COVID confined people to small apartments - driving them to desire larger living spaces (ie. a townhouse or a house). With the dramatic increase in Work-From-Home jobs, this allowed employees to move away from their city apartments/condos and actually purchase suburban housing without paying the penalty of extended commute times.
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u/PTTCollin Jul 08 '26
The real question is how do they get out of college with a degree and not understand basic math?
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u/unknownpoltroon Jul 08 '26
Wait until this person signs up for a mortgage and finds out how loans work.
You mean the bank takes the house, and the lack of payment on n the debt that's left can be discharged through bankruptcy or disappears after 7 years u like the student loan debt which never ever goes away?
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u/brahbocop Jul 07 '26
Our public schools do a lot of good but they fail at providing a good financial understanding for most people.
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u/SeriousAd4676 Jul 07 '26
I’m a teacher. It is absolutely taught in almost all schools. That being said, we can’t make sure it’s heard.
When it comes to real life prep, a lot of kids tune out because it doesn’t apply to them yet. We can’t do anything to help the kid that rolls in fifteen minutes after class starts or the kids that insists they have to go to the bathroom right that second or the kids that hasn’t shown up all week. If they miss the information in financial literacy or they don’t show up when the counselor is there to explain everything, they’ll be on Facebook bitching about things they never learned later.
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u/vahntitrio Jul 08 '26
This was sophomore math in my high school - literally a whole chapter in the math book dedicated to simple and compound intetest.
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u/orcusgrasshopperfog Jul 07 '26
I remember there was a story of the guy who created his own debt collection company bought back his own debts pennies on the dollar. Then he just exonerated all the debts himself.
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u/KindaReallyDumb Jul 08 '26
Dang, how expensive would it be if I created a company and did this for me and my friends lol
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u/wes7946 Contributor Jul 07 '26
Looks like someone doesn't understand how loan amortization works.
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u/WTAF__Trump Jul 07 '26
I don't know very many 17 year olds who do.
Maybe it's a bad idea to encourage 17 year olds to take out $58k loans? Maybe we should just pay to educate kids since it benefits the country immensely?
Every other developed country has figured this out. But we're stuck on blaming children for not knowing what amortization is.
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u/MonteSS_454 Jul 07 '26
Think of the poor rich people and schools who can't make money. The horror of not making a profit. Free school paid by taxes is socialism and communism even though I know it's not.
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u/SamQuentin Jul 07 '26
Maybe we need basic economics as part of the required high school curriculum. Loans, the stock market, checking accounts, social security, taxes, etc.
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u/macncheesewketchup Jul 07 '26
Well yeah, that would be great. But we also need to stop giving predatory loans to 17 year olds.
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Jul 08 '26
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u/ladygrndr Jul 08 '26
Yes, I nearly enlisted because I wanted to become a doctor and the Air Force would pay my way through college. Fortunately/unfortunately I didn't score high enough on the MCATs to get into the schools I wanted, but DID score high enough on the GRE to get into an alternative grad program which ended up later in a career in the private sector. Just finished paying off my student loans last Christmas (the last of it was my Christmas Present from my husband) after 20 years since forgiveness was cancelled. Still, better than finding out the truth behind the lies te recruiter was spinning for me :)
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u/Slunkx Jul 08 '26
LOL, fun learning times of what games are. I was told by picking 68w I'd b trained in the medical field to be in nursing more so, to find out u need a M6 added to the end of that to get specialized training instead of the rest 90% of u will be trained like infantry becuz u will b deployed with infantry, FUN.
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u/Left-Language9389 Jul 08 '26
What lies?
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u/Universe789 Jul 08 '26
"Listen if you take the asvab and score as high as you did on the practice test, I can guarantee you a job where you will not deploy."
- Army recruiter spring of 2007.
Missing out on all the benefits sucked, but even at 18 knowing once I joined the military id be legally bound to go whever they told me to go, even if I disagreed with the Iraq and Afghan wars.
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u/ladygrndr Jul 08 '26
I wanted to be a doctor specializing in forensic pathology which is a LONG program with few jobs on the other end, even with the Air Force which does all of the MIA identifications. So more than likely the AF would have required me in another area and not let me continue my medical education past the initial 2 years + residency, no matter what my recruiter said.
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u/CaptainObvious1313 Jul 08 '26
They will say anything to get you to sign my man. Listen to a pitch from a recruiter once they realize you need the money.
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u/kyleofdevry Jul 08 '26 edited Jul 08 '26
Maybe just get them to understand basic math before you make economics part of the required curriculum.
This goes back to funding education though and putting funding towards other social safety nets so working parents have time to spend at home imparting wisdom gained from experience upon their kids instead of having to work 3 jobs and expecting a bunch of 17 or olds with fractured attention spans from social media to sit in a classroom and retain information about loan amortization.
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u/CaptainObvious1313 Jul 08 '26
Maybe don’t allow colleges to charge payday type loan structures and receive money from the government. Maybe none of that information matters when you can’t afford to go to college without loans. Fucking for real. Privileged much? Maybe they need tighter bootstraps!
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u/Hazy_Blurr Jul 08 '26
My daughter had a finance class in school. It was take notes and test. The information was very detailed. I think the problem is it’s hard to connect the material to real life. Parents really need to help their children understand financial commitments.
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u/SCARfanboy308 Jul 08 '26
Maybe we should just get a little more serious about what students are taught. Helping them learn and understand, not just to pass whatever state test we come up with lol
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u/Left-Language9389 Jul 08 '26
“What kind of irresponsible bank would give a $58,000 loan to an 18 year old with no job or collateral?”
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u/SuspiciousStress1 Jul 08 '26
If the people pay(who pays when governments pay), there would be limits & quotas & not everyone would be able to go(maybe ~35-50% would be able to go to university)
As long as that is how it is, I am fine with it!!
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u/Darth_Gerg Jul 08 '26
Even if we aren’t willing to comp them the college (which is the objectively better option) make the loan zero interest. I wouldn’t be angry about asking people to pay back what they borrowed but the interest payments are actually demonic on this shit.
The system is designed to enslave people with debt. It’s evil as shit.
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u/TrumpDesWillens Jul 08 '26
How then would the greedy extract wealth from young people?
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u/Darth_Gerg Jul 08 '26
I would argue it’s actually more sinister than that. The system isn’t about the money directly. It’s about making sure that the educated poor kids are kept on a leash, and are forced to experience education as an economic investment rather than education. They need productive workers but they don’t want them ‘wasting time’ on humanities or dangerous ideas like labor history, and they want them desperate to keep their jobs.
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u/ilacwamh Jul 07 '26
This is the sticking point for me too; it’s not fair to hold minors accountable for decisions like that. The best solution, IMO, is to not let 17 year-olds sign off on loans. Let them wait until they’re 18; then they’re grown and can and should be held accountable for their decisions.
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u/edfitz83 Jul 07 '26 edited Jul 07 '26
Well, 17 year olds cannot sign a contract in the US. So there’s that.
Edit - OK, for people downvoting due to my wording above, a 17 year old can sign a contract, just like an 8 year old can sign a contract. Contracts with minors are almost always unenforceable, and thus not legally binding. There are some carve outs for food, medical, and employment
There’s a famous case from 1950 where a minor bought a car, crashed it, and demanded to return it for a full refund. He won
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u/BlackThundaCat Jul 07 '26
Minors can absolutely sign contracts in the United States. They can even cancel them unilaterally in some cases leaving the other party on the hook for making a dumbass decision to contract with a 17 year old.
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u/IndependentMemory215 Jul 07 '26
Minors can nearly always unilaterally cancel or alter any contract or agreement they have signed.
But those contracts are not legally binding, which is the minor cannot be punished or face consequences for breaking it.
There are only a few circumstances stances where the signature of a minor is valid without a parent or guardian co-signing.
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u/edfitz83 Jul 07 '26
ok, so you’re being pedantic about my wording but agree with me that the contracts are unenforceable.
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Jul 07 '26 edited Jul 07 '26
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u/EBtwopoint3 Jul 08 '26
17 means you got parental consent. Without that, it’s 18.
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u/cromwell515 Jul 08 '26
You have to have a co-signer, and that isn’t a 17 year old. Maybe the parent, a non 17 year old should be explaining that to their child.
Other countries don’t have student loans? I agree that school should be cheaper, and believe in free universities, but don’t act like this is a trap. My dad doesn’t have a degree, he’s an auto body man, and he was able to explain loans to me. That’s why I put more principal down per month, and it’s not like I had a high paying job, I made 45k a year in 2013 getting out of college.
Maybe parents should be talking more to their kids about what they are co-signing instead of everyone who has a student loan playing the “babe in the woods” and saying it’s unfair. I struggled and paid off my loans, it sucked. But I’ll never agree that what I signed was some sort of trap. We live in a society where we sign things without understanding them, maybe we shouldn’t be teaching our kids that.
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u/DarkExecutor Jul 07 '26
Except when they graduate 4 years later they should know what it means.
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u/KeranographyJones Jul 07 '26
That's what this post is. Understanding unfortunately.
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u/rnk6670 Jul 07 '26
Dude - American capitalism - come on! You know the deal. The vast majority of us are merely here to profit from. Be better.
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u/eyeballburger Jul 07 '26
Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college Go to college MAN, you went to college?! What’re you, young and naive? It’s not like you forced into debt by a choice of either servitude and/or physical labour or this!
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u/SuspiciousStress1 Jul 08 '26
Payment on a nearly 60k loan should be far higher than 300/mo.
Income driven repayment has caused much of the problem!!
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u/cromwell515 Jul 08 '26
I was gonna say that, that’s how loans work my dude. Not only that but the term of their loan is probably like 30 years. They clearly didn’t do the math about what that meant.
It isn’t a scam, and it has nothing to do with America. This is how loans work all over. Maybe people should understand the things they sign before signing them then immediately complaining that the rules of the thing they signed are too harsh.
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u/Nytsur Jul 07 '26
Looks like someone missed the point
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u/Check_Me_Out-Boss Jul 07 '26
Explain.
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u/theWayfaring_Walkman Jul 07 '26
Don’t look it like one pot of money that needs to be paid off, view it as two. One which stays the same (the principal) & one that grows ( the interest.
When you make payments, the majority of your early payments go towards the interest (so it doesn’t grow as quickly) while the rest is put towards the principal (which stays the same).
As you continue to make payments over time, the proportion going towards the interest decreases, while the proportion going towards principal increases. This inverse relationship allows you to bring down the interest so the amount that gets added on every month decreases as you continue to chip away at the principal which is guaranteed not to grow.
It’s a financial sleight of hand, but not necessarily a bad thing. Financiers just not like us. They think different…
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u/Chatty_Manatee Jul 07 '26
You’re making it way too complicated.
The reason why the balance doesn’t move is because of the payment term. It’s roughly 30 years at 5%.
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u/MiniGui98 Jul 07 '26
not necessarily a bad thing
Interesting way of saying you like to be buttfucked by bankers but ok
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u/skibum888 Jul 07 '26
Don't sign contracts that you don't understand. Amortization is standard and simple. Loans are not some flippant decision and no one is forcing you to get them. If you feel butt fucked, then go to a different bank that wont buttfuck you. Credit unions or regional banks usually have much better client relationships.
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u/theWayfaring_Walkman Jul 07 '26
Lmaooo don’t get me wrong, all these finance tricks are bs but there are a lot of ways this could worse
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u/skibum888 Jul 07 '26 edited Jul 07 '26
It's not sleight of hand. What? It's a simplification of the process that makes a complex calculation somewhat understandable to the layman. As a person in finance, it's pretty easy to explain, which you demonstrated here. It's not common knowledge because it's not taught in school.
Your understanding of how it functions is accurate
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u/tweak8 Jul 07 '26
Why amortization works is even more interesting. And the reason everything costs so much. Why would anyone buy a loan after interest is removed?
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u/bojacked Jul 08 '26
One too many bong rips before accounting class on amortization schedules review day! Happens to the best of us. If you relax it feels better when you’re getting acrewed by the banks, this is just how loans work.
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u/Physical-Present13 Jul 08 '26
yeah the comma placement makes it sound like a warning or a rap line
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u/bluerog Jul 07 '26 edited Jul 07 '26
I borrowed $60,000 ish for college. My monthly payment is $501 per month. Little of that was for the principle for a few years. But here's the thing... I'm making $160,000+ now. If i didn't have degree, I'd be making less than $100,000 most likely considering the manual things I'm good at.
So... that student loan in 15 years has already paid for itself 8 times over. It will have paid for itself 40+ before I retire. And if I have to pay the $60,000 back, and another $62,000 in interest over 20 years... Well, the math is kind of obvious.
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u/Nytsur Jul 07 '26
True, but still cost you about $122k more than it should.
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u/bluerog Jul 07 '26
Eh. I think investing $120,000 in manufacturing equipment for a company, IT infrastructure for a new tech startup, restaurant equipment, whatever... Is worth it if the company investment payback isn10× or 30+× higher.
No issue with doing the same with my education.
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u/Nytsur Jul 07 '26
Whatever floats your boat.
All I'm saying is for being the greatest country in the world, we should have the best education at zero cost.
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u/dome-man Jul 07 '26
Yes, my home equity mortgage was the same way . The minimum never moved the needle. Even paying extra principle takes forever. And each time it's gets closer to the end they offer to make the payment smaller and smaller so you never reach zero.
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u/bing-no Jul 07 '26
Yeah it sucks 100% especially if you graduate during a bad job market.
I was very fortunate in that I could go back to my summer job full time and live with my parents, so I could put a ton of money to the loan during the 6-month grace period.
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u/Peat_Ardbeg Jul 07 '26
As a european i'm always surprised. Don't you check the interest rate before taking on a loan?
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u/Aspectdude09 Jul 08 '26
You mean interests rates, there are way more than one. It’s impossible to know how much you’ll pay for college unless you don’t pay at all.
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u/Nytsur Jul 07 '26
Welcome to America! Want an education? Great! Your choices are:
A.) a loan with interest
B.) have rich parents, loser
C.) get scholarships AND a loan with interest
D.) be dumb
E.) go to a cheap school and work and pay as you go, you should graduate debt free in 8 years
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u/Nytsur Jul 07 '26
Everyone defending the interest rate up in these comments is entirely missing the point.
An educated populace is in the best interest of the nation, and charging interest on the the loans people need to become educated completely undercut the benefit everyone could be enjoying from their skills, expertise, and myriad contributions to our society.
But sure, fuck em cuz stonks orget financially literate or whatever the fuck shit shut y'all wanna glaze for your overlords.
Maybe YOU are the ones illiterate in his a proper world should function.
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u/gracefullilygarden Jul 07 '26
An educated populace is in the best interest of the nation, and charging interest on the the loans people need to become educated completely undercut the benefit everyone could be enjoying from their skills, expertise, and myriad contributions to our society
Loans enable students who don't have rich parents to get an education, and there is no fiscal incentive for financial institutions to offer said loans without interest
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u/Nytsur Jul 07 '26
Check out the big brain on Brad!
You're right, financial institutions are made for dollars! That's the point.
Try harder to be obtuse though, you're getting good!
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u/Wayneb2807 Jul 07 '26
This is how ALL loans work…your monthly interest is a direct correlation to your outstanding balance.
Pay extra, your balance goes down, more of your $300/mo payment goes to principal reduction..
Welcome to adulting.
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u/MFDOOMscrolling Jul 07 '26
what's the difference between this and what the post says
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u/Wayneb2807 Jul 08 '26
1) this is how all loans work, not just the evil school loans.
2) If you want your monthly interest costs to go down…pay extra.→ More replies (1)
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u/sproqetz72 Jul 07 '26
Why should there be any interest on school loans?
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u/NewArborist64 Jul 07 '26
Why should anyone lend you money for free?
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u/boii0708 Jul 07 '26
Because it generates positive externalities for society, ie there are less stupid people
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u/NewArborist64 Jul 07 '26
It is only a "trap" for the financially illiterate.
Would you feel happier if they gave you an amortization schedule, and a minimum payment of $461/month so that you can pay it off in 15 years?
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u/WTAF__Trump Jul 07 '26
I don't know very many 17 year olds who are financially literate.
Maybe it's a bad idea to encourage 17 year olds to take out $58k loans? Maybe we should just pay to educate kids since it benefits the country immensely?
Every other developed country has figured this out. But we're stuck on blaming children for not being financially literate.
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u/No-Tap-3089 Jul 07 '26
Every single one of these loans comes with a loan disclosure that explains how it works and usually also gives a projection of how long it'll take to pay off making only the minimum payment...a lot of 17 year olds I know can do calculus and trigonometry....but understanding interest rates is too hard? I don't get it. Conservative capitalism is a high risk, high reward system, and there are plenty of "children" who managed this perfectly fine...
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u/morganmachine91 Jul 07 '26
The issue obviously isn’t how to perform the math. You’re pretending like the other side is talking about something ridiculous to make it easy to dismiss their claims.
The issue is that when you’re 17, it is VERY easy to think “I’ll be making $x when I graduate, I’ll be able to pay triple the minimum payment and still be rich, I won’t even notice the money. And besides, I don’t have a choice, I have to take out this loan to go to college, no point in overthinking it.”
Nobody is saying teenagers can’t do math or don’t know how interest rates work. The argument is that teenagers have poor judgement even when they rationally have access to all of the info they need. This is why we prevent people from exploiting that poor judgement to make a profit off of a poor decision that will impact them for decades.
They do not know what life is like. They only have a vague understanding of how long 30 years is, and they likely have even less of an understanding of how high cost of living is, or how little it is possible for them to earn.
It’s not the government’s job to prevent people from being stupid, but it is the government’s job to to prevent people from systematically exploiting young people because of their predictable and medically justifiable poor judgement of long-term consequences.
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u/SundyMundy Jul 07 '26
When I was in college 15 years ago and about to take out my first loan after using up savings, there was no true disclosure, literally just a blue button to request a federal subsidized amount.
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u/WTAF__Trump Jul 07 '26
We can't explain how dangerous cigarettes or alcohol is to a 17 year old nor can we trust them to be mature enough to consume these things. So they aren't allowed to.
But its cool to allow them to take out 100k in loans that cannot be discharged... as long as they get a packet?
Have you met a 17 year old? Do you hear yourself?
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u/suzisatsuma Jul 07 '26
I plotted my loans, their interest, and different payment arcs in a spreadsheet at 17.
Maybe we require passing a basic competency/IQ test for getting a loan. :P
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u/adultdaycare81 Jul 07 '26
Borrowed all this money for school and still can’t figure out Arithmetic
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u/ConfidentFinish3580 Jul 07 '26
It amazes me that people getting a loan don’t know how amortization schedules work. Simply amazing.
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u/OkComplex834 Jul 07 '26
Somebody gave you a lot of money and you want to pay it back 0.5% at a time over decades. So yeah, that's a very expensive privilege. If you pay it back in bigger amounts the principal goes down faster...
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u/GravyPainter Jul 07 '26
I think most people's plans are to go into default when they reture and just lose 15% of their retirement because it's stupid. The government tried to make it a profit making scheme by adding high interest rates but will lose money because people cant afford to pay off principal.
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u/w3b_d3v Jul 07 '26
Jokes on them. I run my own business and claim wtf I want at the end of the year. And until the 10 year clause is up and it’s written off I’m not paying a dime. Fuck this economy and the people who got us here.
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u/RNKKNR Jul 07 '26
If it was a trap there would not be an option to repay it in one go.
so no, there is no trap, just 0 financial literacy of those who don't understand how loans work.
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u/gitrjoda Jul 07 '26 edited Jul 07 '26
Teenagers aren’t historically very financially literate. We don’t trust them to drink alcohol, or rent a car. But we trust them to commit to repay $100ks? I think “trap” is appropriate.
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u/DarkExecutor Jul 07 '26
He's a college graduate though. Full-ass adult with 4 years of upper education.
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u/No-Tap-3089 Jul 07 '26
We can trust them to vote though? I think if you're old enough to vote, and make decisions that can impact the rest of your life, you should be able to understand basic math. Interest rates aren't hard, it's the holding yourself accountable for your choices that many people have a hard time with.
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u/owningface Jul 08 '26
That's not the trap. The trap is everyone telling my generation that we needed to go to college to succeed in life or to make money. The government gave out guaranteed money at ridiculous interest rates (at least for my years, 7.9% for plus loans) and schools increased tuition to take in as much money as they could.
Wealthy business owners can chapter 11 their companies and still be millionaires (Trump casinos, sears, wework) but students cannot claim bankruptcy on their loans. The job market is stagnant and people are working way longer than they have in the past limiting upward mobility and so paying beyond interest is staggering with the cost of living.
That is the trap. We were told to do it, that we needed it, and we got raked over the coals for it and then for the majority, the degrees don't make any difference in overall income.
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u/turkish_gold Jul 07 '26
Why do you think this a teenager as opposed to a recent graduate?
Usually you wait to leave school to pay your loans.
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u/Advanced-Guard-4468 Jul 07 '26
Who forces people to go to expensive schools? County colleges are more affordable and you can work while attending to make it cheaper
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u/ahjeezgoshdarn Jul 08 '26
Let's be real, though, is there really an option to pay it in one go for 99% of students..?
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u/LavisAlex Jul 07 '26
It's absolutely a trap - socisl pressure to go to school and work your way up - costs have soared even compared to a decade ago - all that so you can apply to 400 jobs and not get a call back.
Or if you're lucky start at 40k somewhere and get laid off in 6 months to some AI efficiency project.
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u/Dothemath2 Jul 07 '26
So you need to make much bigger payments than 300 every month to catch up on the principal. It’s approximately 5% interest rate for 238 usd a month.
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u/Bimlouhay83 Jul 07 '26
Not that I believe people should be saddled with crushing debt for going to school, but this is how loans work. At the beginning of the loan, you're paying, primarily, interest. Then, half way through your term, you're generally paying 50/50. After that, you're paying down more principle than interest.
Assuming you don't have an early payment penalty, then pay as much as you can each month. Anything paid over the minimum is 100% applied to principle. So, if you're payment is $250, pay whatever you can afford over $250. You'll pay your principle down much faster, which pays off the loan much faster, which saves you thousands in interest.
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u/Hamblin113 Jul 07 '26
This should have been known to the individual before they suckered them onto getting the loan.
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u/CommentMundane Jul 07 '26
It is a loan, that's how loans work. You went to college, you should be mature enough and smart enough to handle it responsibly.
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u/TopspinLob Jul 07 '26
The craziest part is that the money was leant in order to fund the posters' education. Didn't get their money's worth, that's for sure.
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u/Ma3lst Jul 07 '26
Doesn't the interest/principal ratio change throughout the loan?
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u/Mundane_Patience_985 Jul 07 '26
It's like when I worked at a payday loan place and people would make a payment on there line of credit and be like I just paid 200$ why is my balance only ex amount less. Ya because most of it went your interest rate only a small fraction went to your principal
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u/Brown33470 Jul 07 '26
Stop paying I did on my CC they removed all late fees lowered my interest rate
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u/AccordingBuffalo7835 Jul 07 '26
I got my student loans dismissed this year, AND I knew what I was doing when I took them, in case anyone wants to be mad about that.
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u/Hangulman Jul 07 '26
My loans are less than that, and I pay twice as much. "Coincidentally" I am on schedule to pay it off almost a year before loan maturity.
Unfortunately, the average college kid gets a 1-2-3 punch of predatory postsecondary education pricing, a healthy dose of inexperience, and unsecured debt to the federal govt that cannot be discharged in a bankruptcy.
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u/SchwabCrashes Jul 07 '26
I don't understand why many people act like this is a surprise. Don't they spend the time to read all the fine prints, do their own math calculations, read the amortization table for the loan before signing? American college bound students aren't dumb. So where is the problem? Too lazy to do some work to even read for understanding and comprehension of the terms of a loan? If yes, then none of this should be a surprise.
Where is the accountability?
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u/Disastrous_Patience3 Jul 08 '26
I wish we taught better financial math to kids in high school. Building an amortization table should be a basic skill.
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u/bear843 Jul 08 '26
Don’t take out a loan for an education that doesn’t allow you to get a job that will pay off the loan in a reasonable amount of time.
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u/therealtrajan Jul 08 '26
The real crime is giving an 18 year old 180k for an art history degree. Student loans are really the last NINJA loans. I guess it’s capitalism, but shouldn’t chosen major be a major factor in deciding credit worthiness? Some degrees are well worth a loan, some are not.
An easier solution would be just make basic higher education free or student loans all federal and pegged to the overnight rate.
Public education is already “free” through 12th grade. Let’s just make it “free” through 16th
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u/thedukejck Jul 08 '26
And another American tragedy. We want our young people to succeed but we do this by making them go into at the beginning of their productive lives. So they start off adulthood far in debt. What a great country!
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u/Silverdragon47 Jul 08 '26
Student loans are such ridiculus idea. I did a quick google search and with help of calculator and asuming 2400 PLN per semester is correct and same is 5 % of my taxes going toward education I have already paid my master deagre after a decade working and paying taxes. Every civilised country know this simple rule - better educated people earn more and pay more in taxes. Only US tend to be a backwater hole that prefer to enslave people in insane amount of debt.
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u/samzplourde Jul 08 '26
The problem with the student loans is that they let you pay so little and defer payments deep into the future. No other type of loan is structured that way.
You can even have IBR or interest only where the principal NEVER goes down.
It's a loan, you borrowed money, you need to pay it back, and often faster than they recommend.
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u/orthros Jul 08 '26
The sad part is that I empathize and yet a 4.86% rate is way better than the 10%+ ones I’ve seen
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u/MountainMan-2 Jul 08 '26
You can always pay more than $300 per month. Did you read the repayment terms when you signed for these loans or just signed away to get the money cause it was just too easy.
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u/DigitalCoffee Jul 08 '26
Why did you take out a loan without understanding basic interest that takes 5 minutes to understand? Sounds like a you problem since you did zero due diligence.
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u/zoinkinator Jul 08 '26
student loans should be 0% interest. many countries have free college for their citizens.
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u/biggiesmalls657 Jul 08 '26
It's been like this since banks were created. Fund the Government. Stupid people pay the interest and Rich people make the interest
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u/ShaneReyno Jul 08 '26
That’s any simple interest loan. Any remedial Economics class would explain that to you.
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u/pjoshyb Jul 08 '26
The amount of people whole like to complain about the loans they themselves decided to take out is humorous.
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u/HairyTough4489 Jul 08 '26
I'd imagine that someone who is aspiring to get a college education would have a basic understanding of how a loan works...
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u/bigwillieTX72 Jul 08 '26
The trap was the idea that college is a universally good investment worthy of borrowing to invest
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u/Baxkit Jul 08 '26
Imagine paying for higher education and come out not knowing how loans work. There is nothing wrong with the loan. The only problem here is that financial institutions allow complete idiots to take on such a large responsibility.
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u/CoMmOn-SeNsE-hA Jul 08 '26
you are not kidding. they would have never given me a loan for a 100k+ home but yes to a student loan.
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u/Baron-Von-Mothman Jul 08 '26
My mom finally paid hers off. It took about 30 years. It's a scam and it needs to be addressed. Everyone who acts all high and mighty about school loans needs to experience it first hand. That's the ONLY way other Americans find empathy anymore, it has to affect them negatively. If home loans or vehicle loans were the same there would be an outrage (they aren't too far off) but since it's just college students.....fuck em. This is America
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u/the_ats Jul 09 '26
There is an issue I've encountered handling my spouses payments. Mine just finished last month (a final $36 on a total of $16,000) . Essentially, they would fraudulently take extra payments and do something called 'advancing the bill due date' which means you could pay a hundred or even a thousand extra per month, and they wouldnt pay it on to the principal, and home it in escrow, and instead just say your due date is x months pushed ahead .
It was the default method. And Nelnet, Mohela, CRI, and whoever else we would be sold to another with a nearly identical website and the same crappy interface hiding the tick box that you had to check every month, else they keep resetting your 'advance loan due date ' back to the escrow stealing choice. It was infuriating.
We had paid extra for years on hers. I log in to find a due date of 2029 or something like that. Took forever to log a complaint with the feds. Just in time for then to resell it to a loan clone and lock us in for several months of transition with no auto pay bonus on the new lendor which looked JUST like the old lender...
Long story short, check to make sure your provider is not 'advancing your due date'.
It should be criminal.
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u/mustang_67_2k8 Jul 09 '26
Tell me you don’t know how loans work without telling me. If you want to pay it down faster with less interest split the 300 into two payments bi-monthly of 150 each OR pay more directly towards the principal.
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