Hoping to Finish Ahead by Starting Behind

$76,133.53 — I owe this total to various lenders, who decided four years ago that trusting an eighteen year old with this sum of money was a good idea. However, the original amount of money I owed was much greater ($107,822.33) and even I am amazed with the amount of debt ($31,688.80) I have paid off during my time in college.

Following my heart
A little over four years ago, as I was preparing to graduate from high school, I was in the midst of making a life-altering decision. I needed to choose between attending a public school a few hours from my home in Florida, or my dream school: a private institution in New York City, a school that I fantasized about attending ever since I was a child.

I would be the first person in my family to attend a traditional four-year college or university, and I wanted to make sure that the degree would allow me to live a better life than my parents, and someday achieve financial independence. I was worried that the public school that I had the opportunity to attend would not provide me with the proper set of life experiences that I needed to be successful in life, and I knew that the school in New York City would be able to give me a unique college experience, and put me in a strong position to succeed.

Putting the financial ramifications of my decision in the back of my mind, I decided to follow my heart, and go to New York City. However, I did not fully understand the financial impact of my decision until years later.

A baseball analogy
I liken my current situation to that of Chien-Ming Wang, who is a starting pitcher for the New York Yankees.

Wang had an atrocious beginning to his season, giving up over twenty earned runs during his first three starts. In each outing, Wang lasted no more than two innings or so, and by the time the Yankees decided to put him on the disabled list, Wang had an ERA of over 35.00.

Note: For those of you unfamiliar with baseball statistics, ERA stands for Earned Run Average, and describes the ratio of earned runs per nine innings pitched. Most pitchers have an ERA between three and five, so having an ERA of thirty-five is pretty extreme.

 

In order to lower his ERA to an acceptable level, Wang would need to pitch a lot of scoreless innings. In fact, during a game earlier this season, an announcer made a comment that Wang would need to pitch sixty or more scoreless innings just to bring his ERA down to his career average of 4.16; needless to say, that feat would break many records.

My financial earned-run average
In a sense, my ERA is my collection of student-loan debt (the composition of which will be a topic for another post), which is barely manageable. In order to bring my debt down to a manageable level, I need to have five or more years of “scoreless innings.”

As many personal finance bloggers can attest, consistently completing scoreless innings is a difficult thing to do — one life emergency is able to impair one's ability to “compete” financially going forward in life.

  • Build an emergency fund?
  • Contribute to a 401(k)?
  • Be more frugal than a broke college student?

Starting so far in debt to begin with makes it difficult to do these things, though I'm trying to put my best foot forward in my quest for the elusive state of financial freedom. In fact, for the last six months, I have been devouring any and all information that I can find on personal finance, and have learned more or less what I need to do in order to achieve this goal.

Choosing to start behind
However, one thing that has become readily apparent is that unlike Wang, whose high ERA was not intentional, I chose to start behind. I chose to attend a private school in New York City. I chose to incur over a hundred thousand dollars of debt.

Although I am starting with a significant amount of ground to cover before I am able to reach a point where I am debt-free, attending college in New York City, albeit at a high cost, has provided me with many unique opportunities.

For instance, during my sophomore year of college, I was able to obtain an internship with a prestigious firm within the financial services industry. Since I went to college in New York City, I was able to work part-time at the firm during the school year, which ultimately allowed me to begin a full-time job there immediately after graduating — something that is relatively unheard of in this economy.

Much to learn
Growing up, I was taught that some things in life do not come easy, and that money is not the ultimate source of happiness. Although I believe I have a strong working knowledge of the personal finance arena, I know that I still have a lot to learn, and paying off my student loan debt within the next four to six years will be a difficult, if not daunting, task.

Given the opportunity, I would love to chronicle my journey towards finishing ahead (or more immediately, getting to the starting line) here on Get Rich Slowly, and share with the readers the personal finance knowledge I gain along the way, as well as any life experiences that I have relevant to the discussion. If anyone has any questions for me, feel free to leave them in the comments section, and I will respond as soon as I am able.

Chien-Ming Wang photo by Keith Allison.

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Writer's Coin
Writer's Coin
10 years ago

Now that you’ve graduated and are done with school, I’m curious if you would make the same decision to “start from behind.” Obviously, the experiences you had over the past four years are priceless, but would you do it all over again if you had the chance to start from zero instead of in debt?

Anne
Anne
10 years ago

I love this post. I love seeing thoughtful financial advice from someone who isn’t a squillionaire already, who’s working with the same sorts of stuff most people deal with from the bottom, not dispensing advice from on top of the pile after success. You, at least, aren’t patronizing me selling some loud red-font book with hyperactive bullet points on how to manage my finances.

Please, keep us posted on what tactics you take given that you’re in debt!

Cynthia
Cynthia
10 years ago

Good luck on your plan to get out of student loan debt, A.J. It will be a challenge, especially given the high cost of living in New York City, but you seem to be focused. I look forward to hearing more from you.

Michael
Michael
10 years ago

Thanks for the post AJ. I started waaaay behind. More importantly, I didn’t do anything after school to get ahead of my finances until now. Today I paid off a $500 line of credit and that really felt good.

Good luck and keep a clean nickel.

Chance
Chance
10 years ago

With one exception, I have thoroughly enjoyed the audition posts. However, this has been my favorite so far. I can’t wait to see who “wins” the position!

Anki
Anki
10 years ago

Really enjoyed this stiry. Good luck on getting to and leaving the starting line behind you, A.J!

Trini
Trini
10 years ago

I wonder if A.J. considered a middle ground – going to a state school outside of his home state. There are quite a few public schools that are highly ranked, and while they might not have been his dream NYC school, they might have been a step above his home state public school. The benefits, of course, of a public school are in-state tuition (even if you have to pay out-of-state the first year while you get residency, it’s a less expensive education overall). I also took on a substantial amount of debt getting my professional degree, even though I… Read more »

Chett
Chett
10 years ago

To continue the encouraging part of your entry. Nolan Ryan, in his first season had an ERA over 20, but most of us remember his as the “No-Hitter” king and holding the record for the most strike outs ever. So yes it is possible to have a terrible beginning and finish strong. But, your new pedigree from New York will guarantee you no more success than the next guy. It was/is the New York investment and financial firms who helped orchestrate the mess we are in now as they paid no mind to personal finance and instead focused on “getting… Read more »

Kevin@OutOfYourRut
10 years ago

It would help if you could give some information on what your major was and what field you’re going into. Some careers might be worth taking on a six figure debt load, but most not. $100k debt on a $35k income would be hard to justify, especially since a car loan and some credit card debt would add to the pile quickly.

But it sounds like you’re on a solid path though if you’ve been able to pay it down by 30,000 just by working part time.

Kat
Kat
10 years ago

Chett, The average American who wants instant gratification for everything, and buys a new car and new house on credit that they couldn’t reasonably be expected to pay for if the smallest emergency happened is just as at fault of the economic meltdown. It’s easy to blame the “Wall Street” people as a whole for the mess, but that is just a scapegoat for a much larger problem. No one “caused” anyone to do anything they didn’t already want to do, they just enabled people to make stupid choices. And the tech guy at Wall Street firms had absolutely nothing… Read more »

Liz
Liz
10 years ago

I second what Chance has said…of all the guest posts, this has been my favorite. Great post.

Betsy Wuebker
Betsy Wuebker
10 years ago

This was my favorite of your guest posters so far as well. I want to hear more of his story! Congratulations on being focused toward a lifestyle that will assist in paying down your obligations.

td
td
10 years ago

A.J., your story is inspiring and impressive – especially the fact that you’ve managed to pay down so much debt in such a short period of time, while working part-time! I wish you continued success in all of your endeavors! To the various individuals who have commented on this post so far: Starting financial salaries in New York City are far higher than $35k a year, and talented individuals can easily earn well over $100k just a few years out of college. Placing all of the blame on Wall Street is foolish and absurd – no one forced people to… Read more »

mollyh
mollyh
10 years ago

Loved the baseball analogy! And I agree, sometimes you do chose to start from behind in order to follow your passion, and I’m ok with that. Thanks AJ.

Sam
Sam
10 years ago

I have been reading a lot about how the student loan industry will be the next bubble to pop. I am a big fan of education and I think advanced education can be very worth while but does it make sense as a society to saddle our very young with years of debt payments. I have a friend from professional school that has $100,000+ in debt and she married a classmate with another $150,000 in debt so they stated their careers with $250,000 in debt and the plan to pay on it for 30 years. That debt has impacted their… Read more »

Caitlin
Caitlin
10 years ago

I don’t think I liked this one as much as some of the others. There’s not enough personal detail to get me interested – it’s just a bit too vague (What major? What field? What school? etc). I’m willing to give it a chance if he becomes the staff writer, but at the moment I’m just not sure how inspiring a story about a guy who got $100k in school debt and is now working in (presumably) a field that will let him pay it off quickly could be. If he paid off 30k while working part time, sounds like… Read more »

migz
migz
10 years ago

When I was choosing to go to school, I never factored in cost, prestige of school, etc. I knew I wanted to go to a 4 year school and take in the whole college experience and not worry about the details. So like him, I took on many student loans and found myself in a hole as well after graduating. When I exited school 3 years ago I had $65K in debt. Fast forward to now, I’ve knocked that down to $40K. Sure I could’ve knocked off an extra $10-$15K extra, but I’ve learned that while debt is not a… Read more »

A.J. Clark
A.J. Clark
10 years ago

@Everyone who asked what my major and field was in college. I majored in Computer Science at a private school in New York City, and I also took a lot of Mathematics classes while I was there. Which school I went to is not really all that important, as there are a handful of private schools here, and the cost is consistent between them. Yes, I work on Wall Street, but I write computer programs for my firm. For a software developer, working in financial services is no different from working at Microsoft, Apple, or Google. Instead of making operating… Read more »

libby
libby
10 years ago

Great post! I’m not too far out of college, and I can’t wait to read more about everything that AJ’s been learning.

Kam
Kam
10 years ago

As a college graduate, as of 3 years ago, I thoroughly enjoyed the post. I am now 3 years into working Full Time and I’ve learned so much in that time and it’s nice to see someone with a perspective I can relate to. Like you I’ve been reading all I can about personal finance and becoming financially independent. I’m 25 and trying to save and increase my credit score and it’s nice to see someone who has started to pay down early and not wait until after school like I did. Continue to be frugal and use my money… Read more »

Kinu
Kinu
10 years ago

I applaud you, and I personally know that it can be done. Between school debt and bad credit decisions at a young age, I owed about $71,000 in 2003. It’s taken me 6 years, but I’ve paid off everything but $6,900. Working diligently on it still! (This doesn’t include the house and car that I recently bought.) Although you make a lot of money, get prepared to make a lot of sacrifices! You can do it! 🙂

Tony in KS
Tony in KS
10 years ago

Very interesting story to which I can relate. I am a recent grad, I do not work on wall street but I work in financial services. I, however went to a public school, a big one, and studied Accounting. Personally, I don’t think any private school (even in NYC OMG!) is worth student loans. 80k, 90k, 100k in debt out the door?…crazy. I can tell you that I landed a job in this economy with a public school degree, I didnt’ have a 4.0, I didn’t know uppper management…the school does not matter…it’s just the fact that you have that… Read more »

ebyt
ebyt
10 years ago

Aside from the baseball analogy (I’m a hockey fan and know zero about baseball and it’s too early in the morning for me to actually comprehend the definition you wrote for the ERA LOL), I think that your post was interesting. I would definitely like to see more from you. I’m close to your age and I have much less debt, but I find it interesting to see how people my age cope with getting to financial freedom. I think your posts mixed with JD’s posts would be a great combination 🙂 You sound like you have a good head… Read more »

Jess
Jess
10 years ago

I think this is a great post and definitely relevent to many people. Education is becoming increasingly more expensive, but it is an investment in yourself. So I agree with the thought that sometimes to get ahead, you need to start behind. I went to a private school for undergrad, and I would not trade that experience for anything — even being debt-free. I went to a state school for a professional graduate program, and now owe a significant amount. It is one of the least expensive schools I could attend that was still a competitive program. So Public does… Read more »

Eric
Eric
10 years ago

A.J. –

Great post. I enjoyed it. Having your mind focussed on those things right now is a great leap ahead of most people your age and if you stay focussed, you’ll get where you want to go financially. I hope you get the position, but if not, make sure and chronicle your journey elsewhere – it will attract a lot of interested people!

I also liked the ERA analogy – very creative!

Kevin M
Kevin M
10 years ago

@JD – you have a tough choice here, all these writers have been a pleasure to read. Ever thought of starting GetRichSlowly2 and just having them all write there? @Sam – I am in total agreement that something major will happen to the higher education/student loan area in the next 5-10 years. You call it a bubble, I say it is simply unsustainable to keep raising tuition 7-10% annually. When times were good and jobs were plentiful, it was justifiable to spend $100k to go to school to get a good job. Now the tables are turning and a lots… Read more »

J.D.
J.D.
10 years ago

Kevin M (#26) wrote: JD – you have a tough choice here, all these writers have been a pleasure to read.

Don’t I know it. I’ve been asking myself what sort of pickle I’ve managed to get myself into! 🙂

It’s my hope that everyone — the writers and the readers — understands that *all* of these writers are great, and that it’ll be tough to pick one or two staff writers. I’d love to have them all!

SueB
SueB
10 years ago

I will add my $.02 along to what a few others wrote – I read this blog for the facts. I don’t want to read about a “discount store”…which one saves me money? Or “save money”…give me links to the best CD/money market funds, etc. OK, you get my drift. If you want to write about a school, then give me the name of the school. For gosh sakes, they’re not going to sue you for slander! My previous career was a software developer (writing web apps in VB.net). What language do you use? Are you writing systems from scratch,… Read more »

Anthony
Anthony
10 years ago

I think this post was very relevant to me since I’m pretty much in exactly the same boat. Although I have a few different circumstances. For instance, I just graduated with about 100k in debt but I couldn’t pay any off during the school year since my part time job only paid enough for my food bills, books and other materials. So, now that I’ve graduated, I have this gigantic beast breathing down my neck. Unfortunately I don’t have anything like a Comp Sci degree nor did I go to Medical School. I graduated with a degree in animation where… Read more »

Kam
Kam
10 years ago

I think this is a great post and he would be a great staff writer. He would be able to cover an area that JD can’t cover – the younger demographic, recently out of college. And it’s different from Ramit because this kid is actually paying off debt, not just giving advice about it. I’d love to see how it goes each step of the way, esp. as someone who has a lot of student debt looming overhead.

Trina
Trina
10 years ago

Loved the post and the analogy!

After 3 master’s degrees (all of them on full scholarship), I still ended up over $40k in student loan debt because my stipends were so small and sad that I had to take out loans to live.

The $40k investment has paid for itself many times over, and I’m grateful for the experiences and knowledge I gained.

Patty
Patty
10 years ago

Great post! I am a mom of a teenage son, and I think A.J. would be of help in giving me a younger persons perspective on college, debt, etc. His writing was intersting, and encouraging.

Tall Bill
Tall Bill
10 years ago

AJ:

Since you’re so fresh out of school & 1/4 of the way to a zero balance, looking back to see if it was all “worth it”, etc is probably a bit premature. Howerer, I would like to follow along with whatever blog you end up with. If that’s to be here, all the batter, but I also look forward to seeing what the other have to offer. You have some sharp tools in your vest pocket in the field you’re in & good luck in your efforts!

Shara
Shara
10 years ago

I can tell you out of the box that this post will be long: Regarding AJ’s specific situation, I want to say up front that his choices are his own and just because I wouldn’t/didn’t make the same choices doesn’t mean I think he made the wrong ones for him. I faced a very similar situation out of HS. I could attend a very nice technical school in a big city (Chicago in my case) or my state school. Living in NV my choices were UNR or UNLV, not great prospects in engineering. but I made the opposite choice from… Read more »

Jean
Jean
10 years ago

I’m reminded of a conversation I overheard about a year ago between a financial services vice president and a bright young-ish woman who’d never gone to college. In the course of informal conversation, the two hit it off, the VP becoming increasingly impressed with the other woman’s intensity, problem-solving abilities, personal experience, and surprisingly good memory skills. The VP offered the other woman a job; she declined, citing the lack of a bachelor’s degree. The VP replied that she didn’t care if the woman bought a degree off the Internet — choice of school meant nothing to her compared with… Read more »

Ryan
Ryan
10 years ago

Best audition so far.

At some level, writing about personal finance (or any self-improvement niche) should be about how well you relate a message to the audience, not how many exclamation points you use or how many bulleted lists you can provide. A.J., you nailed it.

I loved the ERA analogy.

Chris Curran
Chris Curran
10 years ago

I like your writing style and I’m impressed with your willingness to take on such debt at an early age. You have to really know yourself and your capability to work hard over the coming years to come to that decision. I do not believe that is a common trait for an 18 year old. With regards to the argument in these posts about the Meltdown, I think we should lay blame equally on Wall Street and Main Street. Wall Street lobbied for deregulation for decades and then over leveraged to absurd levels when they should know better. I mean… Read more »

DCH
DCH
10 years ago

Definitely the best “audition” post so far, in my opinion. Obviously, this personalized post hit a home run (continuing the analogy), since everyone is asking for more details about his situation, etc. I can already relate to him on various levels, which makes me more likely to read any future posts that maybe aren’t so “personalized” to his own financial situation. Thanks!

Bear
Bear
10 years ago

AJ – nice article, it felt a bit like you had more to say but perhaps shortened it after the many comments on the longer posts of the other potential writers. It’s interesting to watch the reaction to these posts, this wasn’t my favorite and yet for many it was. I recognize that GRS has a strong following amongst those like AJ that are just starting out. I related more to the writers that have seem to have a bit broader life experience. No offense AJ and perhaps that will show in additional posts. I’m well beyond college years and… Read more »

Jacque
Jacque
10 years ago

A.J., it is so refreshing to hear from another person in the same situation as my husband and me! Looking back it is so frustrating that so many people(specifically parents, high school teachers, college admissions officers, etc.) dismiss valid financial concerns about the cost of college saying that it is “good debt” and that you won’t have to even think about the loans until after college and your “real” job will more than cover them. I don’t regret college at all, but it is frustrating being a 20 something with so many directions to send your money (student loans, home… Read more »

Stephanie
Stephanie
10 years ago

Great analogy, this post was very interesting and quite helpful. Thank you and take care.

Ben
Ben
10 years ago

Personal stories are very powerful.

Mandee Jo
Mandee Jo
10 years ago

I really liked this post and his perspective. I graduated from college a year ago and am working to pay off student debt (although a smaller amount, thank goodness) It seems like the perspective would be a good contrast to the regular postings and provide more variety than two “grown up” posters.

Sri
Sri
10 years ago

By far the best post I have read from the guest writers on your list to choose from. very lucid, and written from the heart. All the best AJ.

Kaitlyn
Kaitlyn
10 years ago

I look forward to reading about your journey to pay down your debt. My fiance and I are both out of college and looking at doing some additional degrees, which will just add to the existing debt we have from school. We realize that debt from college is “good debt” as in the education we gain will appreciate in value over time, but it sure doesn’t feel good when we have our loan statements and high balances hanging over our heads.

Michelle
Michelle
10 years ago

People choose their college to align with their values. Reducing the arguement to employment rates 5 years after graduation does not take into account other benefits such as experience, prestige, connections, location, social life, athletics, extracurricular opportunities, etc. Different schools offer different mixes of these benefits. It is up to each student to decide what he or she wants to get from 4 years of college and what it is worth to them. AJ had dreamed his whole life of going to this particular college in NYC, so for him, $100k was an acceptable price to pay to take this… Read more »

Beth
Beth
10 years ago

AJ, I’m in the same situation except I’m pursuing a master’s degree (fully supported by the school). I went to a state school for undergrad, but still ended up with $25k in debt, mostly because in my field (meteorology) there just isn’t a lot of aid money unless you get noticed by the government. Luckily, I did that, and the government essentially paid for my last two years of school through scholarships and a sweet internship that enabled me to make tons of professional connections. Great post! I have to agree with the other commenters who have said this is… Read more »

E
E
10 years ago

On the one hand I appreciate the perspective of a young person just out of school, facing a mountain of debt and decisions. On the other hand, a software engineer doesn’t live in the same world as the rest of us. With that kind of brain and that kind of education, you can get a job in any economy and make more money in your first year than many of us see in 5 years. My sister’s boyfriend is a software engineer; he hasn’t even finished his degree but still hit almost $100k in salary his first year at this… Read more »

Greenman
Greenman
10 years ago

This is an extraordinary chain of reasoning:

“I was worried that the public school that I had the opportunity to attend would not provide me with the proper set of life experiences that I needed to be successful in life, and I knew that the school in New York City would be able to give me a unique college experience, and put me in a strong position to succeed.”

I can’t disagree more strongly with this reasoning, but I suspect you need a great deal of life experience under your belt to understand why it’s so off-base.

Foxie@CarsxGirl
10 years ago

Good luck!!!! All I can really say. 🙂 I added up my student loans so far from just my current school — $23k. Ouch. My co-worker about died when I showed him the number, and got even more squeamish when I told him my projected final total. ($40k to $50k) While I read a bunch that says student loans are bad, my parents sure couldn’t afford to help me with school!!! Not everyone who wants to go to school can do so without loans. As long as it’s not excessive, i.e. loans paying for pizza and beer, not just tuition… Read more »

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