How much debt is too much? How much is acceptable?

[thegnuguy]

Hey. I'm trying to gauge the value of different programs and the associated loans. 

How much is too much in your opinion? You can answer with whatever program type you are familiar with.

How much would you definitely be willing to take? $5,000? More? 

I'm curious! =D

[.letmeinplz//]

It would depend on what field and what you can do once you get out. CS pays pretty well, so if I had to take 50k out tomorrow I wouldn't be as nervous as if I was a field that doesn't pay as well or isn't in demand as much. 

[TakeruK]

I'm in planetary sciences. To me, $1 in debt is too much debt -- I would not have applied to or attended any program that did pay for all expenses and also paid an acceptable stipend/salary on top of it. In my opinion, most graduate stipend packages are undervaluing our skills, even considering the fact that we are getting an education.

[.letmeinplz//]

I'm in planetary sciences. To me, $1 in debt is too much debt -- I would not have applied to or attended any program that did pay for all expenses and also paid an acceptable stipend/salary on top of it. In my opinion, most graduate stipend packages are undervaluing our skills, even considering the fact that we are getting an education.

Is that why tuition is so high? So they can say, "well yea 20k stipend isn't a lot, but you are also getting 50k in tuition!".

[MidwesternAloha]

Depends how much you'll make after achieving the graduate degree in your field. If you will make enough to easily pay the debt, go for it. I personally already have 30k in loans from undergrad and I won't go to grad school unless it's fully funded. I don't want to be 40, still paying bills

[.letmeinplz//]

Depends how much you'll make after achieving the graduate degree in your field. If you will make enough to easily pay the debt, go for it. I personally already have 30k in loans from undergrad and I won't go to grad school unless it's fully funded. I don't want to be 40, still paying bills

Even if you have zero loans from school, bills will always need paying. Death, Taxes, Bills, and now Measles apparently.

Edited February 5, 2015 by <ian>

[Cheshire_Cat]

There are several things to consider such as return on investment and what you are actually using the money for.

 

Basically, everything affects your bottom line, no matter what you budget it for.  If you say you are taking out $50k for your education, and then go drinking on weekends and spend $40 bucks each time, then you are really taking out $10,000 of a loan to go to drinking on weekends($40 a week x rounding to 50 weeks in a year x 5 years).  Is it worth it? I dunno, it was just an easy roundable example for me to use.

 

Personally, I'll probably end up with a little debt because I want to keep my horse, and she's expensive. For most people, it wouldn't be worth it. But she is therepy, so definitely worth it to me.  It will probably be considered "educational debt" but I know what it is really for.  However, I also know that when I get my Ph.D, in one year I could pay off the entire amount and still be living better than I am right now.

[victorydance]

I don't believe in debt, whether from school, owning a house, financial, or otherwise. 

[MidwesternAloha]

Even if you have zero loans from school, bills will always need paying. Death, Taxes, Bills, and now Measles apparently.

I guess I should've specified "bills from student loans" lol.

[Pitangus]

Like TakeruK, I wouldn't take out loans for a program in my field (Ecology). And I would have been very hesitant to attend grad school if I were in a field that didn't offer tuition waivers and stipends as standard practice. I would just rather not deal with student loans. I was able to get through undergrad without debt by commuting from home and attending a college that gave me a tuition scholarship.

[rising_star]

It really depends. I didn't take out loans to pay for grad school but did get a student loan, which I ultimately used to buy a car. I bought that car in the first year of my MA (2006) and am still driving it. I'll probably drive it for another 3-4 years unless I'm in a car accident. So, given that, I'd say that I wouldn't take out more than $10-15K in debt. But I'm also not in a subfield with lots of high paying jobs.

[.letmeinplz//]

It really depends. I didn't take out loans to pay for grad school but did get a student loan, which I ultimately used to buy a car. I bought that car in the first year of my MA (2006) and am still driving it. I'll probably drive it for another 3-4 years unless I'm in a car accident. So, given that, I'd say that I wouldn't take out more than $10-15K in debt. But I'm also not in a subfield with lots of high paying jobs.

Isn't the APR for a car a lot less than student loans? Though I guess you have  a lot more time to pay off student loans than a car loan.

[victorydance]

^ Or you could just buy a used car and not have to use a loan. 

[TakeruK]

I do have a car loan actually (1.5% interest rate through my school's credit union). We decided to take out a car loan for our car instead of moving our savings from Canada over to the US to pay for it up front. Since the Canadian dollar isn't doing so well against the US dollar, and there would be exchange fees, paying 1.5% interest is better! I guess I was only thinking about debt from the costs of going to school itself (i.e. rent and basic living expenses, not "luxuries" like a car!)

 

We did get a used car, but still "new" enough that we needed a $10k car loan. We tried to move as little money to the States as possible, and we got this car after 1 year here, so we didn't just have $10k US just lying around after trying to support 2 people on 1 grad student stipend for a year! This is our second car together (our first was a much older vehicle that we had to retire when we moved to the States) and we bought it as an investment for our future.

[lilymasala]

As an anthropologist, my say is zero debt, I would only accept entrance into a graduate program if they funded me.  If I was in a field such as medicine, finance, engineering, or CS that might have less risk on the job market with higher pay after graduation, and thus better ability to pay back loans, my stance on student debt might be different.  

 

I have colleagues in my field who have six figures of student loan debt, and it's kind of heartbreaking to say the least.

Edited February 6, 2015 by lilymasala

[rising_star]

Isn't the APR for a car a lot less than student loans? Though I guess you have  a lot more time to pay off student loans than a car loan.

It is now. It wasn't in 2006... Back then, the interest rates were about the same or a bit less for a Perkins loan. Plus, grad student loans were subsidized then. Now car loans are very affordable, assuming you have enough income to qualify for them. Coming out of undergrad, there was no way I would qualify for a car loan without either absurd interest rates or a co-signer (which I didn't have).

[djh101]

I'll join the no debt allowed camp. In the physical sciences, full tuition and stipend is standard practice. Regardless, I consider post-undergrad to be the time that I wish to become financially independent, start actually making money (if only a little), and begin and start enjoying life. I do not consider grad school to be just an extension of undergrad (a debt-filled speedbump delaying the start of adulthood) and would prefer to do what I can with my bachelors to going through undergrad part 2 (had anyone gone on Ghostrider at Knott's Berry Farm where after you finally get to the end of the queue line, you go up some stairs only to find yourself at the beginning of another queue line?).

 

My parents were kind enough to pay my tuition, so I am currently debt free and can't really speak from the perspective of someone burdened by hefty student loans (I did commute over an hour to UCLA by bus and attended community college my first two years, though), but tuition is getting to the point that (and this is at UCLA, private tuition is already past that point), were I to do it again, I might just take the coding experience I obtained during high school from a web design hobby and tried to find an entry level software job somewhere without even getting a bachelors, let alone a Ph.D.

[Amayan]

The amount of debt I am willing to take out is dependent on what type of debt it is.  Subsidized government loans are less terrifying than unsubsidized loans or private loans like Fanny Mae.