The Truth About Debt: PhD Debt Survey

Rebecca Schuman's recent article on the PhD debt project is a must-read for anyone working in academia, particularly with grad students, and even more for those considering grad school or contemplating leaving. Karen Kelsky is collecting debt data in a simple Google doc. Writes Schuman,

A shocking number of users also report $100,000andup; some $200,000 and over, even with a funding package. “My graduate stipend did not cover my living expenses, books, money I needed for research,” explains one user. “TA salary and fee remission not enough to support my two children,” says another. Graduate students do not usually receive funding in the summer—but are often expected to complete intensive research or exam prep—so many users also cited summer living expenses. Though Kelsky expected a substantial reaction, she says she is still “stunned” at the rate at which entries keep coming in, and “with such devastating figures and stories.”

You can bet I will be adding my devastating figures -- and they are devastating -- to this doc, and I hope you will, too. Until we can demonstrate the crippling, serious, inescapable impact that student debt is having on a generation of students (in particular, students in school for nearly a decade!), this will remain a secret shame. I'm open about my debt. I think you should be, too.

Student Loans: A Life Sentence of Punishment For Grad School

I used to be one of those people who thought that arguments for the abolishment of student loan debt were mostly whiny. They're called loans. We knew that when we got them. I pay my loans. I've written extensively about my complicity in the insanity of higher ed debt. I accept my responsibility.

But student loan debt in its current form is not only unfair, it's unjust. Those of us who took on greater debt even than the average college student are going to, en masse, be impoverished for life under this system. Current student loan debt has huge and obvious implications for the economy, as discussed in these articles, but I wonder if people are considering the plight of a smaller but still significant population of under- and unemployed academics who will be saddled by enormous payments (not to mention the outrageous effects of interest on the final bill. for a much longer period of time).

I'm talking about myself here.



It's Campus Equity Week Oct 28 and the focus is on adjunct justice, the move to technology to replace teaching, and (ETA) student debt relief. Some of their events (e.g. the play For Profit, which explores not only the moral quandary of working in for profit, but the issue of corporatization of all higher ed, and the issue of student debt. This is the precise situation of someone I am very close to, btw.) I want to make it clear that public higher ed is just as guilty of fleecing students as for profit. I have some personal experience with for profit education. Its critics are not wrong. But higher ed is complicit in the boom-and-bust loan cycle as well. It's not a bad guys versus good guys scenario.

The real kicker is that there is no way to declare bankruptcy on student loan debt. If you go on an ill-advised shopping spree and can't pay off your new furniture and car in a few years, you can discharge the debt or deal with it for pennies on the dollar. This could even apply to gambling debts. But student loans are not an option.

Kids -- and I was a kid -- in my situation graduating in the early oughts, were sold a bill of goods.

We cruised into grad school on the tail end of an economic boom, during a time when credit card companies set up tables in the commons and gave us free t-shirts if we signed up.

We were told by our professors that jobs would be waiting, that the baby boomers would retire and with more and more students attending college every year, well. The math is clear.

We were permitted to recklessly take on more and more debt with little to no counseling about what it would mean for us down the road.

We were recruited eagerly as part of a higher education scheme predicated on the cheap labor of willing graduate students to deal with the masses of students. We were underpaid for our work and many of us were denied benefits to subsidize higher education, despite the astronomical inflation of tuition over the last decade. Is the current structure of TAs anything other than intellectual sharecropping? Are loans not liens? And is our harvest not decimated by factors out of our control?

And then the economy tanked, and the job market for academia went from "precarious" to "deadly."

 

Rolling Jubilee has great data on this, and their goal is to buy off student loan debt, but look at the small amount they've raised ($60k to fight $12mil in debt. I can't afford to give them money to help people like me, because I can barely help people like me!). Not nearly enough of us are engaged in an issue and fight that should be at the heart of the post-academic movement. ETA just discovered the Student Debt Crisis website. Awesome!

We are all in this situation, post-ac-ers! We are Margaret Mary if she had taken out $100,000 to pay for her education. This is a CRISIS for those of us in a new class made of the highly educated and financially screwed. Inasmuch as adjunct issues are issues of concern for anyone post-ac/alt-ac/higher ed, student loan debt is an issue for us all. No one interested in higher education reform can ignore the issue of student loan debt and its profound and unjust impact. 

My partner and I work full time and we are treading water each month. At a time in our lives when we could start 529s for our daughters or think ahead towards retirement, we feel lucky to make ends meet. We sometimes do not. We don't qualify for welfare because of our income, but that figure doesn't take into account the $1k we pay each month to debt collectors. We have very little credit card debt compared to a LOT of people, own 2 cars that are over 10 years old, and a house with a very reasonable mortgage compared to our earnings. We're on IBR. We are not extravagant spenders. Every month we scale back and scale back. Our lives more and more closely resemble the lives of working class earners despite our upper middle class education. (I'm basing this on wikipedia. Forgive me. If Sloan Sabbith could explain this to me, it would be great.) We're one car breakdown away from screwed. Christmas this year looks... iffy. I'm not sure our kids will go to college even though they are CRAZY smart. I mean, what were we thinking, to have a family at all? LOL, right??!

I did some reading about the structure of federal lending and was really appalled to learn about the difference in rules that apply to these programs versus garden variety debt. I never took out private loans because the word on the street was that they were horrible, predatory, ruthless collectors. I thought, The benevolent government has all these plans! All this flexibility! Loan forgiveness! Boy, what a crock. If you default, you are not eligible. * If your student loan servicer changes three, four times, it is easy to accidentally miss a payment because you have to learn a new system, reestablish payment dates and procedures, etc. Everyone is late sometimes. If you're deciding to pay a grand for student loans or a grand to fix your car, you're gonna fix your car! Ten years of absolute perfection is unrealistic, and amounts to is indentured servitude, and there is no wiggle room.

Imagine the drain on the economy. The percentage of under/unemployed college grads is crazy; the percentage of grad students even more so. Those numbers are growing, and many of us are facing 10, 20, 30+ years of this financial situation. It's simply unsustainable. It's economic suicide. It's beyond a disproportional response to ignorant, poor choices. It punishes everyone. It's corrupt and lousy and cruel and I'm adding my voice to those who think abolishment is appropriate and just.

 

* Edited to clarify and correct information about eligibility for PSLF. Don't forget PSLF could be repealed and there's no guarantee it will exist in 10 years. The more you know!

Pre-Existing Condition Health Care Plans, By State

As described in the original post about health insurance on this site, people who have preexisting conditions that make it impossible for them to qualify for regular health insurance now have access to health insurance through the Patient Protection and Affordable Care Act of 2010.

Unfortunately, you have to be uninsured for six months before you are able to enroll in one of these policies. However ... if you have no other options for coverage, this is certainly better than nothing. The benefits on these policies are fairly decent and are managed by reputable insurance companies, and the premiums are fairly cheap as compared to what you would find on the regular insurance market with a preexisting condition.

See below for state-by-state links to the websites where you can read about the plans, find answers to your questions, and apply for coverage. You must apply to the one in the state where you currently reside.

(Please note: some of the links are the same between states because some states elect to provide their citizens coverage through a preexisting plan managed by the federal government. Other states manage their own plans.)

Alabama: http://www.pciplan.com/
Alaska: http://www.achia.com/ACHIA-FED/
Arizona: http://www.pciplan.com/
Arkansas: http://www.takecarearkansas.org/
California: http://www.pcip.ca.gov/Home/default.aspx
Colorado: https://www.gettinguscovered.org/
Connecticut: http://www.ct.gov/dss/cwp/view.asp?Q=463668&A=2345
Delaware: http://www.pciplan.com/
District of Columbia: http://www.pciplan.com/
Florida: http://www.pciplan.com/
Georgia: http://www.pciplan.com/
Hawaii: http://www.pciplan.com/
Idaho: http://www.pciplan.com/
Illinois: http://insurance.illinois.gov/IPXP/
Indiana: http://www.pciplan.com/
Iowa: http://hipiowafed.com/index.htm
Kansas: http://www.khiastatepool.com/KHIA-FED/
Kentucky: http://www.pciplan.com/
Louisiana: http://www.pciplan.com/
Maine: http://www.dirigohealth.maine.gov/Pages/pre_exist.html
Maryland: http://getmdhealthcare.com/
Massachusetts: http://www.pciplan.com/
Michigan: http://www.hipmichigan.com/
Minnesota: http://www.pciplan.com/
Mississippi: http://www.pciplan.com/
Missouri: http://www.mhip.org/federal_eligibility.html
Montana: http://www.mthealth.org/
Nebraska: http://www.pciplan.com/
Nevada: http://www.pciplan.com/
New Hampshire: http://www.nhhp.org/nhhp-fed/
New Jersey: http://www.state.nj.us/dobi/division_insurance/njprotect/index.htm
New Mexico: http://www.nmmip.org/hrp1/
New York: http://www.ghi.com/nybridgeplan/index.html
North Carolina: http://www.inclusivehealth.org/fed_eligible_reg.htm
North Dakota: http://www.pciplan.com/
Ohio: https://www.ohiohighriskpool.com/
Oklahoma: http://www.bcbsok.com/ohrp/temp_pool.html
Oregon: http://www.oregon.gov/oha/OPHP/OMIP/pages/fmip.aspx
Pennsylvania: http://www.pafaircare.com/
Rhode Island: https://www.bcbsri.com/shop-for-plan/programs-and-services/individuals-families/pre-existing-condition-insurance-plan-rhode
South Carolina: http://www.pciplan.com/
South Dakota: http://fedhighriskpool.sd.gov/
Tennessee: http://www.pciplan.com/
Texas: http://www.pciplan.com/
Utah: http://selecthealth.org/plans/government/fedhip/Pages/home.aspx
Vermont: http://www.pciplan.com/
Virginia: http://www.pciplan.com/
Washington: https://www.wship.org/PCIP-WA/
West Virginia: http://www.pciplan.com/
Wisconsin: http://www.hirsp.org/plans/federal-plans.shtml
Wyoming: http://www.pciplan.com/

Dealing with student loans

I made the first payment on my student loan today. It wasn't exactly pleasant. It's officially the 3rd biggest expense of our monthly budget after our mortgage and childcare. Despite owning nearly as much in student loans as I owe on my home (and at least that earns equity...), my payments are manageable. Student loans are an aspect of life after grad school that most of us dread coping with, but in my experience (and from others), they're not nearly as awful as you might expect. I highly recommend that you start figuring out loan stuff now (during the grace period) rather than leave it until the last minute. Avoiding looking at the bottom line won't make it any smaller, and there are steps you can take now to make life less miserable.

Caroline Roberts @ Postacademic has a lot of excellent, accessible advice about handling the "wild world of student loans." The comments have great advice, too. Here is my non-professional, but BTDT, advice on getting ready to tackle student loans. And do plan to tackle them: even if all you do is make arrangements to not have to pay them yet, you need to take action on your loans to avoid default. You can't bankrupt your way out of student loans. They must be faced head-on. Here are the steps I think make sense for most people to get started.

 

1. Find out what kind of loans you took out, how much you owe, and who you will repay.

Hey, now is not a time to lecture you on private versus federal loans if you already took the damn things out. Right now, you just need to know how much you owe, who to pay, and the options available for that kind of loan. You'll have to play your cards as they lie, and I won't judge you, but I do feel sorry for you if you took out private loans because I hear they're a bitch to repay. I guess private companies are much less flexible and much less reasonable about repayment, in the same way credit card companies can be (because they're usually the same people).

I only have federal student loan debt to deal with. StudentAid.gov is the place to start because it explains everything very simply. Then, you'll probably head to StudentLoans.gov to set up accounts and such. Sometimes it can take time to set up accounts, find your old PIN, update ancient addresses from undergrad days, etc. So expect it to take a little time to get to the point where you can simply access your own information. Once you've done all that, you can easily see how much you owe (look at the number. LOOK AT IT.), how much your repayment will be, and when it will start. You get six months from the time they figure out you're not in school anymore. This should also direct you to whomever you'll be repaying (Direct Loans, Ed Financial, etc).

2. Learn about deferment and forbearance.

If you're just starting on the quitting journey, you may have no idea what your income will look like in 6 months. You may have landed a job that will make monthly payments in the range of hundreds of dollars absolutely no problem. Or you may still be in that "just for now" job bagging groceries, which means you can afford something but not as much as they may want. Or you may still be up shit creek -- dealing with health problems, or persistently unemployed, or whatever -- and not be able to make payments at all. The link above has a great chart that tells you the circumstances under which you can defer/forebear loans, and for how long. (e.g., you can defer some loans for up to 3 years if you are unemployed.) There are also circumstances in which you can have your loan forgiven or discharged (these involve many years of public service, or permanent disability, etc). Know your options!

3. Learn about different payment options.

Again, the charts in the link above make this simple to interpret. Unless you apply for a different repayment plan, you'll automatically be set up for the "standard repayment plan." This usually means fairly large payments for a shorter period of time (10 years) and that's good because you pay it off sooner and accrue less interest. But if you're like me (ahem) and made many catastrophically bad financial decisions in grad school, you won't be able to pay the standard amount. In that case, consider the graduated repayment plans, or the relatively new and very very wonderful Income-Based Repayment plans. Basically, IBR bases your payment on your income and family size, and adjusts the payment every year. This is a good thing. This is the plan I am using, and my payments still hurt but they are manageable. (I will combine Income-Based Repayment with the Public Service Loan Forgiveness plan and have the remainder of my loan discharged after 10 years).

Go ahead and apply for IBR if you think it sounds good. Remember, you can always pay more if you want, or adjust the plan later on. For now, you need a payment option that's workable with your life as it is today.

4. Look into loan consolidation.

If you're like many students, you've probably taken out multiple loans across multiple years, possibly at different interest rates or even from different organizations. This can mean that when you sit down to start paying back your loans after you leave, you may be looking at having to make multiple payments per month (maybe even to separate companies), which may add up to a total amount that is totally overwhelming.

Before you fall into a total panic, try to figure out if you might be able to consolidate your loans by clicking the link above and starting the application. Of course, consolidation can't reduce the total pot of money you owe. However, it can make your monthly payments (and sometimes your interest rates) significantly lower.

In JC's case, consolidating student loans literally cut her monthly payment in half. She's still going to be paying those bad boys back for waaaaay longer than she'd like, of course ...  but saving a few hundred dollars every single month definitely makes the payments more manageable.

So a few months before your first payment is due, try filling out the consolidation app. There are calculators that can help you get a ballpark idea about whether you'd benefit from consolidation ... and even if you fill out the application and change your mind at the end, you have a month or so before the consolidation goes into effect where you can cancel and change your mind.

So once you gather your list of the loans you owe, play around with the calculators and the consolidation app. It can really help your monthly budget.

5. Set up autopayments if you can.

Late payments can affect your credit score, and you don't want to screw up your qualification for things like PSLF, so setting up automatic debits for student loans is a smart move. For some people whose income fluctuates a lot week to week (e.g. freelancers), this option may not be great (you certainly don't want to overdraft!) but you have to be diligent about timely payments if you don't set up auto-debit. I suck at things like that, so I have autodebits for our loans. These can take over a month to clear with your bank, so do it in advance (I just learned this the hard way, ouch).

If you get confused, call them. They're really very pleasant. The government will work with you. They just want some of this fucking money paid back!



As an aside: you might be really concerned that the amount of your student loans will mean you can never buy a house or a car. This isn't necessarily true. We purchased our home and a car while repaying my husband's student loans. (Note from JC: so did we!) It probably depends on your bank and other aspects of your financial life, but we found that our bank was more interested in whether or not we could afford the monthly payments for all of our commitments than they were in the total amount of our overall debt. You can always ask. They can always say no... but at least you'd know!

I think we have this sense of deep shame about debt and therefore avoid talking about it, but that's not productive. Certainly, I regret my student loans, but I'm dealing with them like an adult -- and like millions of other Americans. If we hadn't asked, we would be paying more money for a shitty rental than we are now for our wonderful home that we own. If we hadn't asked, we'd be freaking about making payments on my student loan rather than making a prompt and affordable payment. Facing my debt has been a big part of the growing up I've done since quitting grad school. I wish I'd done it much earlier. Regardless: it's manageable. Don't fear Sallie Mae!

Applying for Unemployment After Academia: How You Can Do It and How It Might Feel

Depending on the circumstances under which you are leaving academia, you may qualify for unemployment benefits. Maybe tenure wasn't renewed; maybe you were on a contract that is ending; whatever your circumstances, it's probably worth looking into whether or not you qualify for unemployment in your state. A mantra you'll hear again and again on these pages is ask for help, and accept help when offered. If you qualify for unemployment and it would help you during this transition, you should take advantage of it.

Each state has its own rules and procedures. The link above takes you to a clickable map that will help you find the right department to contact in your state.

And take a deep breath. If you think you're the first, or last, post-academic to seek government assistance, you're wrong. There's absolutely no shame in putting food on your table. There's absolutely no shame in admitting you need help. But it can feel humiliating to consider the disparity between the fantasies that drove us to pursue academia and the reality of our post-academic existence. I certainly didn't dream of living in a small apartment with a filthy carpet filling out paperwork for dependent care assistance when I sipped wine and talked theory in the wood-paneled dining room of a professor's bungalow at the first departmental party I attended as a graduate student.

John Patrick Robichaud via Compfight

The new reality can suck, but don't let that deter you from seeking help.

Post-academic in NYC writes about this in "The Crushing Shame of Applying for Unemployment:"

When you call the number, a person who oozes resignation and cold efficiency asks, “you had a teaching job last year, so why did you quit?” You are expected to have a really good reason for why you quit your adjunct gig that didn’t pay well to take a part-time gig that paid a little more (which has since kind of dried up). It is hard to explain this because you are talking to a person who probably thinks “college teaching” sounds like the best thing ever. You can tell the person on the other end of the phone is judging you. She thinks you are an idiot for giving up a perfectly good “college teacher” job, even if it was part-time for not a lot of money. She thinks you’d rather suck on the public teat than work for a living. You really want to launch into a speech explaining about how the neoliberal economic forces destroying the economy also ensure that most college teachers are low-paid adjuncts who live in caves and suck just enough water to survive off of damp surfaces. You also want to explain that surviving grad school and writing a dissertation means you are many things, but lazy isn't one of them.

Jessica Burke, an adjunct, also writes about her experience with an unemployment hearing here. Burke writes about a fairly intimidating and humiliating bureaucratic experience trying to get unemployment, but New Faculty Majority offered her a lot of support. New Faculty Majority has a lot of fantastic information for adjuncts applying for unemployment that you should definitely check out, including a PDF guide for contingent faculty who are seeking benefits. They are fierce advocates for the labor rights of adjunct and contingent faculty, and unemployment benefits are a big part of that. Be sure to let them know if and when you file for unemployment.

The bottom line is: you deserve support.