If you or a loved one will be headed to graduate school this fall, chances are you are worried about more than dorm survival. Instead, you may be wondering how to avoid six-digit student loan debt. It's a valid fear -- no one wants to end up where I started.
Fortunately, there are ways to earn a graduate degree while avoiding financial catastrophe. Using myself as an object lesson, here are some strategies I would recommend:
Reverse-Engineer the Problem
Consider the degree you are interested in and ask yourself some tough questions: How easy will it be to find a job with that degree? Will you have to make other types of sacrifices to get a job in that field, like having no control over where in the country you will live? Are you willing to make those sacrifices?
If you are headed to college this fall (or know someone who is), then you may also be headed to life in a dorm. Like many things, living in a dorm can be an expensive proposition, but it doesn't have to be. Sometimes you can avoid the expense completely -- one good strategy for this is to live at home and attend an online college or local community college for your associate's degree.
However, not everyone is lucky enough to have a college close enough to home to make that a feasible choice. Additionally, not all parents are willing or able to house their adult children. And I think I will shock precisely none of you by saying that sometimes young adults are ... stubborn. If the traditional college experience is important to them, they will find a way to make it happen.
If you or a loved one have opted for campus living, here are some tips and tricks to set up your new home -- without spending a fortune.
Disclosure: I am not an attorney or HR specialist. This is just my experience with, and understanding of, FMLA.
According to the United States Department of Labor (DOL) website, "The Family and Medical Leave Act ("FMLA") provides certain employees with up to 12 workweeks of unpaid, job-protected leave a year, and requires group health benefits to be maintained during the leave as if employees continued to work instead of taking leave." The whole point of FMLA is to promote work-life balance by taking a reasonable amount of leave to deal with personal or family issues.
Because many situations requiring use of FMLA are health-related, the law also requires that your health insurance be maintained as if you continued to work. The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows employees to stay on a former employer's health plan for a limited time after job separation, provided they pay the full premium (employer share and employee share). Unlike COBRA, if you are on FMLA, then your employer still pays their share of the premium for your health plan, even if you are not being paid a salary during your leave.
You may have noticed that, since last September, many of my posts here at Get Rich Slowly have focused on the job search. Some of you may have wondered why I would write about such a topic at all, since my job tenure was over seven years.
Well, it's because I have been job-hunting. And I succeeded! As I write this, I just wrapped up my first week at a new job.
So I thought it would be helpful to revisit some of the posts I wrote during that time to see what job search tips actually worked for me as I went through the process. Here's an overview of how I approached my job search and what made it successful.
For the last few months, I've been talking about various aspects of job-hunting. But what do you do if you can't find a job? OK, you can start with cutting your budget to the bone and applying for public assistance programs if you are eligible. But what next? Well, as with many things, the short answer is: It depends. On what, you may ask? Here's what I came up with:
Are you currently unemployed, underemployed, or employed and just looking for a better opportunity?
Do you have any debt? How much? What kind (a mortgage, consumer debt, student loans)?
Speaking about building wealth, J.D. Roth felt that he could never make this point emphatically enough: "Frugality is important, but if you want to make real progress, increase your income." It's in this context that being able to ace an interview becomes a very important skill. And certainly part of the interview process should include your asking questions of a prospective employer to make sure that the job and the company are right for you.
If you are early in your career, though, it is natural to approach a job interview as if it's a test that you might or might not pass. But this perspective could lead to some undesirable results:
- Firstly (and ironically), it may prevent you from highlighting your strengths.
- Secondly, it may keep you from finding out the things that you need to know in order to properly consider a job offer if they do want to hire you.
Here are three more ways having a test mentality can affect how you conduct your interview and some strategies for how to avoid potential missteps.
In my last post, I talked about how personal finance is about playing the long game and "making choices that are harder in the short term for the good of the long term." But when the payoff is so many years down the road, it can be difficult to stay on track. In order to actually reach long-term goals, you have to keep making the right choices day after day. How easy is it to fall off the wagon a week or two after you start a new diet, for instance? You need a game plan for the short term that supports your long game too.
Especially when you are young, there are just so many goals to strive for simultaneously. For example, Jake and I currently have the following goals:
House projects. We replaced our HVAC and decided solar panels aren't for us right now, but we still need to demolish a corroded metal shed and resurface our back deck.
When you think about it, personal finance is about playing the long game. Sure, it's about other things as well. It's about paying off debt. It's about spending less than you earn. But when you think about it overall, it's about making choices that are harder in the short term for the good of the long term. Here's what I mean….
Saving for retirement
Saving for retirement, for example, means having less money to spend today. Having less to spend today can help avoid lifestyle inflation, which is generally regarded as a good thing.
However, there are plenty of responsible things that could be done in the short term with that money. For example, you could pay off debt or give to a charitable cause that is meaningful to you. You could stash that cash in an emergency fund or eat organic foods and hire a personal trainer.
Short answer? Yes.
But that wasn't very interesting, now was it? So let's weigh the options for working while in school to get a better understanding of why you should consider it.
Working as a Way to Pay for School
There are lots of stories about people working their way through school. Unfortunately, it is becoming less common in some quarters, but perhaps the biggest reason to work your way through school is that tuition has been rising faster than inflation for decades and every dollar that you earn saves you from student loan debt -- some of it, anyway.
In my homeownership and priorities progress report in September, I mentioned that Jake and I were considering getting solar panels installed on our new house. Although that was our last priority, our first priority was replacing our HVAC unit. We thought there might be HVAC units that were made to be compatible with solar panels.
As a result, we decided that it might make sense to investigate solar panels sooner rather than later. That would give us a better sense of our timeline as well as help us determine how much cash we needed to start stashing away in our savings account. Here's what we found out.
Getting Our Home Assessed
The first step was to have someone from a solar panel installation company assess our home. This was free because they simply want your business. They look at factors like: