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This week’s Ask Kate question is actually the same question from three different readers — because I see it all the time. If you want to travel long-term but are carrying student loans, this question is for you.
Reader #1: I am seriously considering quitting my job to travel. My problem is….I have roughly $20,000 in debt due to college. Any suggestions as to how to manage this if I have no income coming in? I originally gave myself a goal of paying it off first (in 3 years) but I will not last 3 more years in my current job. I am not even sure about 3 more days.
Reader #2: My actual problem is this – I know I want to travel but where do I start? I also have $15,000 student loans to pay. My plan would be to pay them off at once and simultaneously save for a trip -is this viable?
Reader #3: What should I do? How can I break in to being a travel writer or find work abroad legally in say Spain or England or Australia? Or should I wait until I pay off my student loans (aka never do it)?
These three emails are from this week alone. That should tell you how often I hear this question.
First, know that I am not a finance expert or professional. I’m not going to give you the advice that you would get from most finance gurus (though after reading The Money Book for the Young Fabulous and Broke, I think Suze Orman would agree with me here!).
I’ve been chipping away at thousands of dollars worth of student loans for seven years and traveling the world for two and a half years while still making my monthly payment each month. I’ve found a way to make it work.
While debt is never a good thing to have, some kinds of debt are better than others. Credit card debt? Bad. High interest and it will wipe you out. Student loans or a mortgage? Not nearly as bad.
But even student loans have different tiers of debt here in the US. I have low-interest public loans and a $176 monthly payment. Some of my friends have hefty high-interest private loans, and they pay hundreds of dollars each month — often more than what they pay in rent!
I saved $13,000 in seven months. When I started saving, I had about $16,000 in loans remaining. Could I have used that money to pay off my student loans instead of saving it for travel? Absolutely.
But that would have left me $3,000 of debt remaining and zero savings. I saved that much money by taking on way too much freelance work, becoming a shut-in, and sleeping four hours a night during the week if I was lucky. I managed to do that for seven months, and the money poured in — but had I lived like that for any longer, I would have completely lost my mind.
Yes, you could save every penny and pay off your student loans as soon as humanly possible, saving yourself a lot of interest as a result. But does that mean you’ll be giving up bar nights with your coworkers, impromptu trips with your friends, fun new activities, living in a fun neighborhood, and all the things that make your twenties amazing?
You only get one chance to live your twenties. Believe me when I say that things change when you get in your mid-to-late twenties. People start getting engaged, getting married, having babies. Things change fast, and your circle of friends evolves to people who have more in common with you.
When I was 24, I would regularly go out until 4:00 AM and then go to work the next day. At 28, I can’t remember the last time I went to a club.
Carrying student debt isn’t the worst thing in the world. Even Barack and Michelle Obama didn’t pay off their own student loans until they were in their mid-forties — and that was only because his books became bestsellers.
Should you pay your student loans off in full? It comes down to evaluating the kind of life you want to have and how paying different amounts on your loans changes that. Maybe the ideal option for you is to pay off your loans quickly; maybe it’s to pay the minimum each month; maybe it’s somewhere in the middle. Only you can decide that.
So, you’re ready to travel? Read on.
My advice to everyone:
1) Pay off all high-interest debt before you start saving for travel. Pay off all your credit card debt; pay off or sell your car; pay off your crazy private student loans.
If that means you have to delay your trip by years, so be it. There is no easy solution when you’re buried under mounds of crippling debt.
2) If you have paid off your bad debt and have only low-interest debt remaining, save enough money to cover your monthly loan payments while away.
I worked my student loan payments into my budget — I made sure enough to add in my monthly loan payment for the seven months that I would be away.
3) However, if you are drowning in debt and will do anything to start traveling, there is another option for you: teaching English in Korea. Not Thailand. Not Japan. Not Spain. Korea.
While teaching English is generally a low-paying gig around the world, schools in Korea pay for your apartment as well as your flight — and the cost of living is low. While you won’t earn a stellar amount, you will have very low expenses. Some English teachers live very well in Korea while still saving $10,000 per year.
For more information, ESL Cafe is a great resource for teaching English all over the world, and Waegook Tom has taught English in Korea for three years.
Is teaching English the same as traveling at your own whim? Nope. But it’s a way to scratch your travel itch while responsibly paying down your debt.
Whatever you decide to do about your debt is completely up to you. I wish you all the best of luck.
Note (21 June 2015): Due to the amount of spam comments that this post receives, I’ve made the decision to close comments on this post.
Love this advice! I also have a decent amount of student loan debt but my goal is to save up enough to travel *and* pay on them regularly for a year.
Another thought, especially for no-income people who might be looking to do some short-term traveling (a couple of months) rather than long-term (indefinitely): income-based repayment. This is a little known but GREAT option. They assess based on your previous year’s tax returns and reassign your monthly payment. My monthly payment went from about $300 to $30 a month. That was perfect for when I was traveling for the first half of the year, although now that I am employed I am going to push it back up so that I’m not paying off my loans forever! 🙂 But if you are looking for a shorter-term solution, that’s a great one. (Oh, and for the first twelve months of you doing it, your interest doesn’t grow! Although this may have been just for my circumstance.)
Actually, the income-based repayment isn’t always the best option. When I began my first full-time job after graduate school, I first chose this option to pay off my consolidated federal loans. However, when I saw the amount of money that they expected me to pay each month, they must have assumed that the only expense I had in the world was my student loan payment. Needless to say, I switched to a lower monthly payment plan, which also sent any money that I overpaid each month directly to my principal rather than my interest.
As I work in higher ed I say the same thing to every student that comes my way – every circumstance is different and the best thing is always the contact whomever directly to see what the best option is for you! My point was that there are definitely options that work for some people, others work for other people, that make you able to not live shackled to your debt. 🙂
Very true, Kristen.
Great post! As soon as I read the title I thought no- go travelling with your debt but you offer a balanced argument and good solutions. I have been travelling with debt as I was so eager to leave and get started, it was hard at times but I would much rather have good experieces than be financially secure.
We decided to pay off student loans before we travel. We are lucky though in that we have been busting our a$$es for years and have been working multiple jobs in order to pay off $40,000 worth of student loan debt within a year after graduating from grad school.
Good for you Michelle. In my opinion, you guys made the right choice.
If a person has debt, other than a 25 year mortgage on a house, why wouldn’t you want to work hard and pay it off sooner than later?
Kate, you mentioned that you worked hard for 7 months and saved $13,000. Why not take one month off and work another 7 months and had 10,000 to travel and be debt free?
Experiences in our 20s are invaluable but not living under a mountain of debt is more liberating when you’re 35, and I’m assuming when you’re 45, 55 and 65.
I too, chose to have several jobs, working hard to to be debt free. I didn’t spend a lot of money on the extras but we always had money for booze, smokes, cheap take out and the dollar cinema on the weekend (gotta love the black and white classics). I didn’t have the newest clothes, eat at the most expensive restaurants, nor drive the shiniest cars but hey, I was in my 20’s. No one expected that of me anyways.
I was able to pay off my loans and save for a trip to South America. When I came back, I chose the jobs I wanted as I had no outstanding debt that required my immediate attention. This freedom allowed me to enjoy the work I wanted = HAPPY GUY.
It also meant that when I went to buy my house, I had a sizeable down payment as the money I earned was in the bank and not used to pay DEBT.
I was able to travel throughout North America, able to buy a boat and continue to scuba dive, and eventually travel overseas every year for at least a month all because I paid off my debt when I was younger.
So, I suggest, you work hard to pay off your debt over a few years. Any experiences you get in life, whether you are 20, 50 or 90 are going to be awesome.
Bottom line, find what works for you and TRAVEL YOUR BUTT OFF.
YMMV
It’s all about priorities. For me, I know that there’s no way I could seriously consider paying off my student loan debt unless I found another job that came with a sizeable pay raise. Even now, if I spent no extra money and lived at home (which I still do, currently), I’d waste years of my life working like a dog with little to no enjoyment – and for what? And by enjoyment, I mean little things like my iPhone, occasional dinners out, my gym membership, and shopping for clothes a handful of times a year. You never get these years back. Do you really want to live miserably until you’re 40 just to pay off your student loans? I’d rather just factor the payments into my cost of living and wait until I get a raise – then I will worry about paying as much off as I can.
I have to agree with Jason and Michelle. I don’t think anyone here is saying you should live miserably until you are 40 to pay off student loans. What Jason is saying is you make sacrifices to pay off your loans in a MUCH SHORTER amount of time. What is 2 or 3 years out of your life to get out of debt, then you can spend the rest of your 20’s, 30’s and 40’s traveling free of debt.
No one who seriously decides to tackle their debt is going to end up spending 20 years paying it off.
Credit is serious business and carrying loads of debt for years has serious consequences.
That’s not true. I know plenty of doctors whose loans are so high that paying them off before they decide to spend their money elsewhere would mean spending years and years of their lives doing nothing but putting money towards their loans.
It’s a nice thought that you can pay off your loans in a few years but it’s not always possible – that’s all I’m saying.
While I agree that finding a medium is a good idea, Xenia, I think living like an ascetic for two years of your very limited twenties-before-everyone-starts-getting-married is a big sacrifice.
Jason, while it sounds good in theory, that would have been impossible for me. There’s no way they would have allowed me to take a month off and then come back. At the salary I was making at the time ($50,000), there’s no way I could walk into a new gig on a whim and make that much money. I also would not have been able to save another $13,000 because a great deal of the money for that came from finite gigs.
In short, I was working like a maniac in order to make that money and there is no way I could have done that any longer. I literally burned out — I woke up and knew I could do it anymore.
I’m glad you found a system that worked for you — I’m very with how things are going for me as well.
I think the interest rates now are much lower than when I graduated before 2008. If you can’t pay of the high interest loans, I would try to consolidate them to a lower rate if you graduated before the rates became so low.
Sallie mae will try to drown you.
Good advice. I think Taiwan could also be an option for people wanting to pay off debt, as salaries are similar there to Korea and the cost of living is similar, if not slightly lower. There are certainly more jobs advertised in Korea, though. I don’t have any debt, but I’m still tempted to take a teaching gig in Korea (though I don’t know how I’d survive the winter!) just to build up a nice amount of savings!
True, Sam — the thing is, though, that in Taiwan they don’t cover your apartment, so you have to pay for that large expense yourself.
Ohhhh, student loans. I pay off £300 a month so I can be debt free by my early 30s – on my minimum payment schedule I’d be paying them off until I’m 56, which is just not going to happen. I’m lucky enough that this still leaves me around £250-300 to travel every month, and that I’m in Europe where travel is fairly cheap, but still. I hate them so very very much.
I have a similar type problem with paying off my student loans. I have come to the realization that saving is more important. My monthly payments are roughly $350, which is high for me. However, the payments are based on my income, so it could be much lower than that. As long as you are aware of your finances and budget, most likely it will be fine. If you are not willing to have no income, then start teaching English and work from there. It will give you a taste of what is possible when you are abroad. However, keep in mind that you will still be working and not as flexible as being on the go.
Great advice Kate, I was hoping you would give that advice.
I am in my 40’s and have been debt free since I was 27, other than a home mortgage, but that is gone now too. The key is not to get into debt, easier said than done. Student loans are something you just have to do, just like if you buy a house you have a mortgage. Work it into your budget and pay them off. We are traveling and have worked in the rental of a storage unit in the US as part of our monthly budget, while we aren’t working and traveling. It can be done and just cut out the extras to budget properly.
How many cafe latte’s do you get a Starbucks or how often do you eat our? That is low hanging fruit to cut back and you will quickly save. That said, to me travel is almost as important as that college education. I would actually think of it as an extension to your education. The experiences you have and things you learn when you travel can’t be taught in a classroom.
Great advice! I was debating the same thing but realized I may never be able to travel long term again while those loans will still be waiting for me when I return 😉 in the grand scheme of things trading the trip of a lifetime for repaying loans a year earlier wasn’t worth it to me.
Sounds like your priorities were in the right place, Emily.
I think the key is no matter what, do NOT try to defer your loans. I have read that advice on other blogs and you only end up paying ALOT more in the long run. It’s not worth it.
My monthly payments were $500/month before I left to travel (debt from both college and law school). I did the math and decided it made sense for me to take an early withdrawal from my 401(k) to pay down about half my debt so I wouldn’t be burdened with payments while I was on the road or for a couple years after returning. I calculated that the penalty and taxes from the withdrawal were likely less than the interest I would continue to accrue by paying down slowly, so I felt like it made sense.
If I hadn’t done that, I probably just would’ve factored the $500/month into my travel budget and continued to make payments on the road.
Yet another example when taking 15 minutes to do some calculations can save you a lot of money. Thanks for the tip, Katie!
“3) However, if you are drowning in debt and will do anything to start traveling, there is another option for you: teaching English in Korea. Not Thailand. Not Japan. Not Spain. Korea.
While teaching English is generally a low-paying gig around the world, schools in Korea pay for your apartment as well as your flight — and the cost of living is low. While you won’t earn a stellar amount, you will have very low expenses. Some English teachers live very well in Korea while still saving $10,000 per year.”
Ha…yes! 2 years in Korea has left me student-debt free. I also visited Thailand and New Zealand, as well as many corners of the incredibly untouristed ROK itself. Not as cool as backpacking through southeast Asia for two years – but a great compromise between travel and making money.
I’d echo another poster who says that Taiwan is also a place where one can save some money and – from what I understand though I’d love to hear more from teachers there – China is increasingly becoming a place to save, too. In Korea I easily saved $1,000/month while doing lots of shopping and going out and buying and cooking quite a bit of western food; had I cut back on those activities I could have saved a few hundred more a month. I think in Taiwan and China teachers can save $5-700/month, on average.
I have heard the same exact information that you share here, Melissa. In Korea you’ll save the most of all, but China is growing and Taiwan pays well (though you do have to pay for your housing and flights there).
I had $24000 that I paid off in three years. I accomplished that by living at home and working two jobs. My paychecks from my higher paying job went straight to my loans and my other job went to miscell. things. I managed to squeeze in short term trips during that time. When I made my last payment, I booked a trip to Disneyworld.
Congrats on getting it all paid off, Melissa!
Yes debt especially high interest debt you want to get rid of quickly. offering great advise like teaching aboad is an excellent way to travel since many expenses can be carried by the provider and a great way to see regional areas cheaply.
great advise!
Good advice, Kate! My tactic is to get in my multi-month trip BEFORE the feds come after me for my grad school loans… hahaha.
And this, honestly, is why I’m never going to go to grad school. I cannot take on more student debt!
Being smart about it is important eg. in New Zealand you need to be out of the country less than 6 months and then back for 31 days to keep your loan interest free. Find these things out early and plan your trip accordingly.
I am certainly in the smallest percentage here, and I don’t recommend this to anyone, but I ended up running from most of my debt. Of my $50,000 in student and credit card debt I have $20,000 in student loans that my mom co-signed on and so I dutifully pay my $309 every month to her, mostly saving for the payments before I travel to save her credit, and making the rest of it on the road. But when I tried to talk to my high interest loan guys on the other $30,000 of debt, they refused to lower my payments. I was unemployed at the time and simply couldn’t afford it. When I explained that if they didn’t lower them I couldn’t pay them at all, they didn’t seem to care. So I took what little savings I had and moved to New Zealand on a working holiday visa. Since I had paid my mom a year of my loan payments in advance, I didn’t have to worry about it while I was there. I came home and worked more and saved more and started traveling again, none of it going to my then 12 month defaulted loans. It’s true, my credit is ruined but part of me is OK with that. I don’t really want to buy things I can’t afford in the future, debt is debilitating and I did enough of that in my early 20s. I don’t plan on owning my own home for at least a decade, or living in a city where I even need a car (I’m also a horrendous driver). It’s not the path for everyone, but even at a job I hated making $50,000 a year I was drowning in all the payments every month, many of the rates jacked up to 25% because of OTHER people defaulting. I knew I wouldn’t be able to pay off enough to leave for at least a decade and I didn’t have that time to give to them. Not sure there is advice here, just my personal story. I struggle with the decision sometimes, but ultimately I just did what I needed to do.
Taylor, I wouldn’t recommend your method to anyone — but if you’re at peace with it, that’s all that matters.
As a finance major and a person that has been in the economics and finance fields for over 10 years I would not recommend it. If you student loans are in US dollars most times it is all tax deductible. On top of that the US dollar has declined in value across major currencies of the world by about 40% in the last 40 years. Point is.. in the future the US dollar will be worse less in value and since payments are fixed on student loans I would highly recommend not paying them off until a later time.
Thanks for your financial point of view, Marcello!
WanderingTrader can you elaborate? Were you saying that a person SHOULD wait to pay off their loans because the dollar will be worth less in value? Thanks!
Thanks for the shout-out, Kate! Teaching English in South Korea really is a great way to pay off debt, experience a new culture, and save money to travel. I spent year one and part of year two paying off credit card debt, and the rest of year two and all of year three were spent saving up enough money so I could do my dream RTW trip! Plus Korea is a fantastic country 🙂
Hmmmm… I agree and don’t agree at the same time. I completely agree that you should not pay your student loans off before you travel. If you can easily, then do it. If not, don’t worry about it. Just save what you can to make monthly payments while you are gone.
As for high % debt, I always felt it should be paid off before travel. Obviously this makes sense. I busted my hump, like you did Kate, to scrimp and save and pay all of my cards off. For an entire summer I lived off $40/week for EVERYTHING – food, gas, all of it. Sucked but I did it. And it was awesome to pay everything off (except the student debt).
Then just as we were prepping to leave i was diagnosed with cancer. Several months later I was back in credit card debt – had to pay medical bills, all sorts of crap, had time off work, etc. etc. I was now crazy about traveling since my plan had been put off for so long already, I hated work and I was sick of being sick and knew travel would change my life for the better. I had to make a decision – pay off the debt (again) or just go. I chose to use my travel savings for what it was intended for – Traveling. And I played the credit card transfer game to get lower rates or even 0%. I am still paying my credit cards and playing the transfer game but I wouldn’t for a second change my decision. It would be great to not have that debt but in the meantime I changed my life, created a new job for myself and I get to see the world. I’m not buried in a stressful job (which i felt added to my health problems anyway) and bummed about my life. I’m happy.
So while I agree, paying off what you can is ideal sometimes you just need to go and make it happen. I can’t imagine what would’ve happened if I stayed to pay the cards off a 2nd time. Everyone’s situation is different but that was mine and it worked for me.
Beth, I can’t imagine how hard that must have been for you — emotionally as well as financially. You definitely made the right decision. 🙂
You may have just changed my life! Thank you Kate! I have spent the afternoon researching teaching in Thailand. Do you know of anyone who has had the opportunity and/or whether a teaching background is required?
ESLCafe.com is a great resource for teaching English abroad. Nomadic Matt taught English in Thailand as well.
Vietnam is also a great place to earn money as an English teacher and the overheads are much lower than Korea. They might not pay your accommodation, but I had many TEFL teaching friends in Vietnam who were earning $1500+ a month and only paying $200 in rent. They managed to travel a lot and save a little too. Japan can be good if you get the right gig, I had a great TEFL job in Tokyo that provided me with flights, full medical insurance, accommodation and travel expenses.
If you put your mind to saving, I honestly believe you can do it anywhere. I live in Stockholm on a modest teaching salary, but I put half of it into savings every month on the day I get paid. People don’t believe me when I say that I can save £1000 a month in Stockholm. The best way to save? Ditch clubs, bars, alcohol and eating out (including takeaways). The only months I have to dip into the savings are the months when I drink alcohol (I rarely touch it most of the time). A $2 cocktail on a Thai beach tastes so much better than a $25 cocktail in a pretentious bar at home!
Elaine, it’s true you can save anywhere once you just decide that it’s more important than anything else. Even as a seasoned drinker, I still manage to also stash away half of my income. Let’s all thank Korea for Soju. And where are these terrible bars charging $25 for a cocktail? I will laugh in the face of anyone trying to so blatantly rob me.
Interesting thoughts. I can see both sides of the argument and there really isn’t an easy answer.
It is, however, easy to get into the thought process of “I’ll travel after I pay off my student loans”, then “I’ll go after I work for two years”, then “I’ll go after ….” and you never get around to it.
I haven’t paid off my student loans yet, and I also have a mortgage back in the UK, but I’m still travelling. I like to think of myself as being careful with money (I’ve never been in debt other than for these reasons), but you have to balance these things with enjoying life. I also have some savings but I keep these as a safety net for my travels rather than putting every penny into paying back my loans. I think it’s important to experience life while you’re still young, but to not be irresponsible.
I also heard that if you’ve got a couple of years’ experience in teaching (and are qualified), you can earn a fair bit teaching in international schools in Brazil. One of my relatives works in Rio and says they pay for your apartment (usually with pool and gym) and most of your expenses, and you still get a decent wage.
It sounds like you’ve got it figured out well, Arianwen!
Really good advice. Don’t miss out on your twenties travels. Not for any reason. But DO pay off your igh interest debt or you’ll severely regret it later. There are plenty of work options as you’re traveling too, not just teaching english. Usually if you travel slowly debt is not an issue.
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I haven’t got a student loan, but have a mortgage back in the UK. I am lucky that my rent is covering the mortgage almost exactly, however if it didn’t I wouldn’t have a problem budgeting some additional money in whilst traveling. As long as you think about it before you travel and pay some of it off month by month, then you should definitely not miss out on traveling.
Thanks for this advice, I have been pondering on this since I graduated. I’ve been paying as much of my loans as I can and saving the rest.
Great post! I myself am trekking off again & I’m not sure if this is an option in America, but being Canada I called the National Student Loans Centre & actually had my account changed so that I am only paying interest for the next year. Of course this is a short-term solution as you really are getting nowhere, but it’s definitely an easy option for 6 months to a year! Agreed about the credit card debt though for sure. x
Good Advice! I paid off a chunk of my student loan before moving overseas last year, completely forgot about it until recently when I had to make my minimum repayments.
Now I realise that it is earning quite a bit of interest while overseas. If I make the minimum repayments it will take me 17 years to pay off, but during that time I would have paid almost $8000 in interest as well.
I am now prioritising smaller trips in the country I am now in, as opposed to big trips, in order to pay off my student loan as quickly as possible, get rid of all debt and become financially independant.
Between my boyfriend and I we owe $100,000 in student loans. He owes $65,000 and when it’s all said and done will be more like $85,000 (or more). His debts are a combination from Clarkson University (which he regrettably attended for 3 semesters & a state university). Mine are just from the state university. After graduation we packed up our lives and drove out west to start life in a new state and with new surroundings. We are also surrounded by so many happy people that live their lives the way they want to, didn’t go to college and are making a living either from their own company they started or working for a really sweet company. This is quite frustrating considering all of our money is going to be pouring into student loan debt instead of living our lives and feeling happy. It is a huge damper. My boyfriends minimum payment is $520 a month (which does not bring the loans down it increases them slowly). I am not sure what my minimum payment is but either way, we cant even afford his, especially on top of rent and other expenses. I think college is a huge scam for those who cannot afford it. The only good thing that came out of it was meeting each other, making friendships and hiking in the adirondacks. But now we have to pay for it immensely. So badly do we want to start saving money to buy land and build our own house but this dream cannot become even remotely a reality for 10-15 years from now. Very unsettling. I also think it is rotten that loan companies do not notify you of your debt. You have to hunt them down to find out your information and then find out that that loan you thought was $3,000 is now $5,500. (This happened to us and we just graduated in May) Just rotten. Seems like we will not be able live the healthy and happy lives we once did and have to work our a$$’s off to make minimum payments. Lets here it for 21 and 22 year olds in America!
I’m sorry to hear about your situation, Holly. I frankly think that the higher education bubble is going to burst within a decade or so. It’s so easy to become an online entrepreneur with no educational barrier, and private university education is incredibly overpriced in the US.
In fact, that’s what I suggest for you. Start reading the Smart Passive Income blog. Look at some unorthodox ways to bring in more income so you can put that money directly to your loans.
great advice, kate! i’ve come to a sort of compromise – although i would love to travel on a work holiday visa or to simply backpack, i just cannot afford it. my student loan debt is a whopping $80,000 even though i received a scholarship for half of my schooling. it’s sad, and frustrating at times, but it can’t be changed.
the good news is that although i am unable to really travel long-term, i am still able to travel. i take a few vacations a year (at maximum, i could take 2 two-week holidays and probably still have a few days left). it’s not ideal, but it is very workable. i decided that paying off my debt as soon as i can is almost as important as traveling. in this compromise, i get peace of mind, as well as the excitement of planning a trip and going.
it’s surprising how many people tell me they would love to travel, but can’t afford it (or whatever the reason is). i am sure that some people have legitimate reasons, but when i compare them to my own financial situation, it seems that what stops people from traveling is fear. fear of the unexpected and the new – fear of not being in control. i tell people if i can travel on a budget, then they can, too. i even offer to help plan it (it’s one of the things i love doing).
the bottom line is it’s important to just GO – for however long you can, whenever you can, and how you can.
Good for you, Erin. It seems like you’ve found a way that works well for your personal situation. Good luck on cutting through those loans!
I have a college age daughter. My wife and I dearly love her and enjoy her company. She is saving money by living with us while attending college and we have told her that, whether she has a job or not, she is welcome to live with us as long as we are living in the future. When she graduates from college, we will work on helping her get her school loan paid off. People have to get over this idea of you have to kick the kids out when they first go off to college. If they get some sort of great job and want to go off on their own, that is up to them, however, if they are struggling, there should be no shame in living with Mom and Dad for as long as it takes. I think that some savage beasts, out in the wild, treat their offspring better than some humans treat theirs. By the way, this poor economy is probably going to be wth us for quite some time to come. People should be willing to to what they reasonably can to help family members because the government cannot do it all and things could get worse before they get better if ever.
Luckily in the UK all student loans are from the government with 0% interest (just inflation equivalent) and you only pay a fixed % when your earning a certain amount, so if your not earning you dont pay!
But i agree with the article..all credit card/short term loans should be paid immediately, also to avoid ruining your credit rating which will really effect you in the future when taking out mortgages etc
Thank you SO much for this blog!
I was just starting to get really down about not traveling, not going out, working so much and not having much to show for it. I live in Japan teaching English (should have gone to Korea haha). The cost of living, taxes and everything is so expensive that the salary we get seems high at first, but ends up barely paying for food and gas after paying all of my bills, not to mention barely any pay during vacation time when we’re ‘legally’ not allowed to work elsewhere. I couldn’t leave if I wanted because I have no money for a plane ticket.
That said, this blog post really reminded me that I’m still having more of an adventure than a lot of people my age (even if I see a lot of my friends here who have no student loans, mostly Australians, traveling around the world during summer and winter break). I’m just going to stick this out and hopefully I’ll be able to hit the road traveling soon enough. Another year of this with a job or two on the side should do the trick.
Thanks again!!
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Hi all,
Kate, I’m not sure if you’re still checking the replies on this post (it seems like lately there’s just spam!! 🙁 BUT I have been dealing with this issue and am torn and need advice! I will e-mail you privately as well, just in case you miss this message.
Basically, I made the foolish decision of going to law school (in Canada, where I’m from.) Because my parents are very poor, they were unable to financially assist me with any of my education costs. I worked a bit throughout undergrad (minimum wage jobs), mostly over the summers which didn’t pay much. I graduated undergrad with about $23,000 in debt, which is the average debt load for Canadian undergrads. I THEN made the foolish mistake of going to LAW SCHOOL and accumulating an extra $75k debt on top of that (law school tuition is expensive, and total cost including rent, etc. per year is $25k. That’s how I got to $75k.)
I got a crappy low-paying law firm job after graduation (the economy for lawyers is VERY bad in Toronto, unless you’re with a top firm..) which I did for 2 years, but was able to pay off $25k (so basically my undergrad debt) with that. I’m now 29, almost 30 years old and still have $75k left.
At this point I’ve decided that I can’t accept anything less than $60k in salary given my loan payments. I have a semi-legal job right now along with odd-end jobs to help pay the bills. I did relatively well in law school but had a horrible first year experience making me very skeptical of whether or not I should be a lawyer at all, and setting back my career goals for a bit. Many of my lawyer friends are between jobs as well, until they find something they like/can stomach.
Anyway, I feel very sad and out of place because I haven’t travelled AT ALL throughout my 20s, due to my crippling debt and I feel like until I get a decent job (paying at least $75k) i won’t be able to pay off much of my student loans. Trying to pay $75k when you’re 30 years old and only making $40k is difficult and could take years.
At this point I feel very depressed and like I NEED to explore the world though, but my family tells me travelling is irresponsible (note my parents rarely travelled throughout their entire lives or even got out of the house much as they were always concerned about finances.) I do not want to be as shut-in as them, and admittedly I was in my 20’s. I feel a HUGE amount of regret now, although one must also sympathize with my circumstances. I admit, 90% of my peers have travelled throughout all of Europe and even the South Americas because they’re all independently wealthy (most lawyers have to be relatively well off to afford law school/come from upper middle class background) and just look at me like I’m an alien when I tell them I’ve never been to Europe.
Also keep in mind that my background is Czech, so it would be nice for me to learn the language and see some relatives back there, which my parents never took the opportunity to do.
I feel at a crossroads now. I’m planning to save up about $5,000 to go on a Contiki-style trip solo throughout a few countries in Europe (Contiki or the Explore program) but I do feel guilty given my debt as well.
Can you provide any consolation/advice, or even if this $5k is a realistic amount? I’ve looked at some Contiki/Explore trips throughout Eastern Europe and they tend to be around $2000 for all land expenses (travel fare, hotel/hostel, food, touring, restaurants, etc.) but you have to pay for the flight costs on top of that. I expect that’s around $2,000 but I’m not sure (Toronto – Eastern Europe.)
Thanks,
LawyerwithTravelBug
LWTB, my advice to you is to take a short trip and simply save up enough money to cover your loans while you are away. I’m sorry that you’re in such a tough debt situation — I know lots of young lawyers in the US who are going through the same thing. But you’re going to be paying this debt off for a very long time and it would be sad to avoid all travel for such a long time due to debt.
Contiki is a good option, but just keep in mind that Contiki trips are extremely fast-paced (one day in most cities) and very young, Australian, and party- and hookup-centric. Take a look at Busabout, G Adventures and Intrepid Travel as well for something a bit more low-key.
Hi Kate,
Thanks for the response, appreciate it. It’s unfortunate this post has been bombarded with so much spam since!! But I’ve decided I will follow your advice. I do want to pay off more of my student loan this year, especially if I start a new job in January which looks quite likely. I will also put aside some money to save for a vacation. Giving myself a little more than a year to save sounds realistic. I could achieve a European vacation for less money if I really scrimp and live low-budget while there; however, given I’ll be 31 when going abroad for the first time and may be going with a friend or a travel group that will involve some hotels and unique experiences, I don’t want to do *everything* low budget either. Maybe if I were a teenager or still in my 20s, but unfortunately I have a feeling travelling in my 30’s may be a bit different. I just turned 30 a few days ago, and am not a very picky or high maintenance traveller, but still… I want to make the most of my experience as well. I’m planning to save about $7,000 for 3 weeks vacation across 3-4 countries in Eastern Europe (thinking Hungary, Austria, maybe Serbia, and another place around there, ideally Germany.) I’d love to do another trip after and hit Paris, England, the Netherlands/Switzerland, Italy for sure, but that would have to be a more extensive trip or 2-3 short trips. How much would you advise saving up? Maybe $10k for all of those countries? I’d be coming from Toronto as well.
feel free to e-mail me if that’s better for you as well; I indicated my email in this post. Thanks,
LWTB
Kate, I think it’s awesome that you were able to quit your job and travel. What’s even better is now you can travel full time and make money from this website! I think a lot of people wish to have the experience you have. It’s nice to see you pointing others in the right direction who are looking to travel. I could read through the pages on your “Destinations” page all day!
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I am a chiropractic student. I have already completed 4 years of my undergrad, only leaving me $16, 000 in debt thanks to scholarships and bursaries. However I am now in my second year of chiropractic school and tuition is 25,000 per year (I have 4 years). At the moment I have around $70,000 in debt and am only half way through! This upcoming summer is my last summer before I continue with school all the way through until I write my boards and can practice as a licensed chiropractor. I know once I start I will need to work my butt off, and work long hours for at least 5 years to get my practice on its feet. I also know that paying off my debt will take quite a long time. Realistically it would take at least 10 years, I understand this and am okay with that. I have also accepted that I will be in 140,000 of debt at least, there is no way around this.
My current dilemma is whether or not I should go to Europe for around a month in the summer (my last summer break probably until I retire). Technically I can fit the costs into my budget, however let’s be honest it would be money from my line of credit. I’m not concerned about not being able to pay interest payments or not having enough money for school because of this trip. However, I am curious if everyone thinks this is the dumbest thing I could ever do. Obviously my parents do not approve as they think it is ridiculous for me to spend money I don’t have, which I understand. But when will I ever have an opportunity to go to Europe again? When i’m 50? 60? …I’d rather go in my 20s when i’m healthy, and not look back in my 50s with regret of not doing something fun.
Any advice either for or against my potential trip to europe is appreciated.
Sarah, is it possible for you to save up enough money to pay for a shorter trip out of pocket? That might be a good short-term solution.
As for the rest of your life, don’t think that this is your last summer off EVER! You’ve got a long life and you can do anything! Just look at me. 🙂
Hey Sarah,
Kate already responded to such a message; see above where she responded to a similar question re. paying off debt from law school & travelling. Law school tuition is the same as chiropractic school, so I totally understand! That said, if I were in your shoes (I’m in similar shoes) I would work for a while and use my work money to take a vacation. That’s what I’m doing. After graduating I worked for 2 year, still working. In that time I paid off about $25k. I still have $75k debt left, but it’s better than 6 figures. I’m going to save up, and plan to go for a vacation this summer or next, when I’m 30/31 years old, go to Europe for the first time. Right now money is tight but it is very important to me. That said, you will graduate soon enough — why not save up money from a job & go on a summer vacation? Very few people would advise taking out another line of credit for that. You are likely still young, in your 20’s – you can always go when you’re 28-30 years old and in a better financial situation.