The news for student borrowers just keeps getting worse. The total student loan debt in the U.S.
Now CNBC reports that one in eight divorces nationally is
caused by student loans.
That is an alarming statistic, but I don’t find it
particularly surprising. I’ve written in
this space before about the growth of student debt, the role of money in
relationships (and their demise), how couples don’t talk to each other about
money before or even after marriage, and how money is always cited in surveys
as the leading cause of stress. Why
would we think that young borrowers could elude those pitfalls? If anything, the stress is multiplied for
them.
Young couples are less experienced generally in handling
money. While we might romanticize the early years of a marriage, that time is
often spent in a delicate give-and-take as the parties learn about each other
and establish the ground rules, boundaries, and personal and shared territory
that will define their lives together.
It’s also when the pair is most likely to be idealistic as they imagine
their future together.
Now factor in about $70,000 in student loans, tight budgets
as they adjust to the realities of living outside the safe environs of a
parent’s home, potentially being blindsided by their mate’s debt, and the very
real possibility that they will have to delay fulfilling some of their
dreams—whether that’s a new home, a new car, or even children—and the stress
level climbs dramatically. As it turns
out, it’s enough to lead to a split and was cited as the main reason for their
divorce by 13% of 800 adults surveyed by the Student Loan Hero group.
It would require a book to
elaborate on all the ideas to avoid and/or handle high student debt. But I will share just a few thoughts.
Avoidance: Hold down a part-time job during the school year and
work summers to pay your way through college.
While it may not be enough to avoid borrowing altogether, it means less
will have to be borrowed. Also, consider
attending a community college for two years.
Given what I see going on at college campuses around the country and what
passes for higher learning these days, you might actually do better for
yourself at the community college level and be guaranteed admittance (based on
having decent grades) to a participating university for the second half of your
college education.
Share: It makes no sense to hide your financial situation from your
spouse-to-be. Marriage is a team effort,
and both parties need to know the whole picture to work effectively
together. It’s only fair and makes for
more realistic planning and less disappointment and heartache. Make finances a regular topic of discussion
(not argument).
Budget: Or more euphemistically, have a spending plan. Having a solid first job after college and
regularly bringing home a check that’s more than you’ve ever made before can
blind you to the need to plan how to disburse and save that money. Don’t let it.
And craft a plan to pay off the debt ahead of schedule. Set goals and work mightily to achieve them.
Pre-nup: Okay, this was
CNBC’s idea, not mine. I’m not even sure
I endorse it. But in order to prepare
for the possibility that the love of your life really just needs you to help
him pay off his debts, have a prenuptial agreement that ensures that should the
marriage end in divorce you are repaid for any money you contributed to paying
off loans he brought to the marriage. Just
be sure you broach this idea with tact and love.
Until next time,
Roger
“Will not your
creditors suddenly arise? Will they not
wake up and make you tremble? Then you
will become their prey.” Habakkuk 2:7 NIV®*
*Scripture quotations taken from the Holy Bible, New
International Version® NIV®
Copyright © 1973, 1978, 1984, 2011 by Biblica, Inc.™
Used by permission.
All rights reserved worldwide
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