Author: Ian McAllister
How to Evade Student Loans
Learn to take an aggressive attitude to college loans. If you learn to run your life properly you will have no need for them, and avoiding that millstone around your neck will give you extra benefits for the rest of your life. College loans are a major handicap in later life.
Think about it. If you master the discipline to live on $2000 per year (OK so allow me to exaggerate!) and you later have an income of $50 thousand that means that you have $48 thousand left. You can splurge by doubling your spending and that still leaves you a lot to invest even after the IRS robbers have grabbed all they can.
Some ways to avoid student loans
- Grants in place of student loans – no repayments
- Part time earning to decrease student loans
- Economizing (builds life skills) avoids some student loans
1.Grants – Supreme way to avoid student loans
A grant is a gift of money that you don’t have to repay. Isn’t a $50000 grant better than taking out student loans every year for four or five years? Yes, your course may be 4 years officially, but you might have to repeat a year.
Even if you need $100000 in student loans, your $50000 grant would cut your student loans in half.
I could give you lots of links for information about grants to replace student loans, but some of them don’t keep up to date and would waste your time. My favorite way is to become a member of a club that will keep you abreast not only of the latest student grants, but of all the USA grants. So even if you are in business, and student loans aren’t looming over you, your club will still help you find useful grants.
2. Part Time Earning
Now, there are lots of ways for you to work your way through college. What I like about them is that they encourage an aggressive “go and get it” attitude. If you get college loans you don’t have to earn them, so what happens when you have to start earning money later on? Student loans encourage the “wait for it to come to me” attitude, so you are handicapping yourself for the rest of your life. I admit that grants have the same effect.
One teenage girl called Nori started her own website using a system where she didn’t have to know anything about web site design. She will never need student loans! Read about her at http://case-studies.sitesell.com/buildwebprofit.html#NORI.
Of course there are lots of ways to make money offline to avoid college loans. Try and find something that combines with your other interests. For instance one girl runs dogs. That’s right, she runs for half an hour with four dogs that need lots of exercise, then picks up the next four dogs. Students often lack exercise. She doesn’t.
You could also give tuition to juniors, or teach locals to use the Internet. If you are good at writing, (get my free report on writing essays http://studying-techniques.com/howtowrite/free-how-to-write-book) you could write for e-lance.com or make your own website like Nori.
A good way to get experience and make a name for yourself is to write web pages (they’re just 800 word essays) at fiverr.com for five dollars a pop.
Just don’t lose sight of your target. You want to avoid student loans, not impress your friends with how much you can spend. That brings me to the next point.
I had a grant for University. While my fellow students were complaining that their student loans or college grants were too small, I was saving money from the grant by economizing.
Important – don’t economize on an income stream. To give you a ridiculous example, you are making $4000 per year from your website. It is costing you $400 per year to keep your web site going. So you close your site and save yourself $400 per year, but no longer have an income ten times that amount.
A dollar saved is four dollars earned
Yes, I mean it. If you save $1 from your student loans, you won’t have to repay one dollar of principal plus one dollar of compounded interest. As a matter of fact, it is even worse than that. You are going to be paying back your loan with taxed money. If the IRS thieves take 50% of your earnings that means that saving $2 in student loan repayments is as good as earning $4. So when you avoid college loans by economizing you are multiplying your efforts by four.
Now look at where you spend your money. Write down everything you spend for a month then you can start to economize on your budget.
You might spend money on these for example
- Social life
Suppose your list shows that these are in order of expense. How can you cut down on food to avoid student loans?
Learn to cook. You are at the mercy of food suppliers until you can cook. One student got into the news because he could only afford to eat tinned dog-food. That is one of the expensive sources of food!
Avoid all processed food and you will cut down on doctor’s bills.
If you don’t want large student loans, find the cheapest things to cook. Find a bulk seller for beans, brown rice, garlic, onions, chillies and so on. See if you can find growers markets. Find the cheapest meats, whether it is mutton necks, kangaroo mince for dogs, venison, rabbit or horse it doesn’t matter. If you don’t like the flavor, just make curry or something with lots of chillies and garlic. Stew it for several hours to kill any parasites.
Don’t be afraid to use animal supplies. My dog mince costs about 30% of the same mince sold for human consumption. I can buy one million milligrams of vitamin C for horses for $30. If you buy a 100- pack of vitamin C pills with 100 mg per pill that would give you one hundredth of what I buy for $30 because it is for animals.
Firstly shop around. Remember that $20 saved per week is $1000 saved each year from your student loans even without interest payments.
Can you negotiate a lower rent for un-furnished lodgings? Work out the value of everything to you not someone else. Have you laughed at a millionaire spending a million on good views, then never looking at them? Have you done something similar on a smaller scale, that could increase your student loans?
How long do you look at your bedroom furniture? Not long… your eyes are closed most of the time, and you are looking at yourself in the mirror the rest of the time. How important is the appearance of your dining room or lounge furniture? Not much, you are watching your food or the television, or reading a newspaper. Do you really need student loans to be in fashion?
Where I live the local government collects special rubbish from the roadside once a year. You can drive down the road with a borrowed trailer and load up with free three-piece suites, dining table and chairs, mattresses, cupboards, mirrors. Suppose you don’t like the look of your free furniture. Just don’t look at it. Suppose you can find four mattresses, but no bed. Stack them and sow them together with a sailmaker’s needle and string. You can’t put your shoes under that bed, but it has wonderfully deep padding!
Apart from saving on student loans, one day you will need to move house. Removalists always break some things. How many tears will you shed if it cost you nothing?
This is probably not very important to you when you are young, but the damage you do to your body adds up over your lifetime, so it’s a good idea to stay healthy. What has that to do with student loans?
It turns out that expensive fast food is bad for your health, and so are most expensive processed foods, and cooking your own food means that you can avoid trans-fatty acids, sugar, and all the other things that cause obesity. Curry, broccoli, tomatoes, garlic, brazil nuts, and cabbage among other things fight cancer. Two cups of dried beans soaked overnight swell to 5 cups. That is cheaper than tinned baked beans.
The less you process food the healthier it is. So save time by not peeling potatoes or oranges. All this saves money on food bills and on doctor’s bills and on lost wages when you are sick. Remember that each dollar you save is as good as saving four dollars in your student loans.
Make inquiries. How much would you save from your student loans by buying a bike instead of a car? Would public transport be better? Would walking or running for exercise be even better? How much would it cramp your style for dating? Wouldn’t it be cheaper to postpone your social life till you graduate and get a job? That would make you a more attractive prospect!
Remember, buying a car with a student loan involves not only repayments, but fuel and oil bills, repair bills, licensing fees, and loss of value of your car. I used a push-bike and traveled about 2 hours a day, but it was good exercise, and I had no college loans.
5. Social Life
This can cost you a lot. You can look for free pastimes. If your friends aren’t interested in ways to avoid college loans perhaps you have the wrong friends. It’s fine for a one-night stand, but if you are serious about your relationship how important is the spectre of taking 25 years to pay off your student loans?
What are your working years? If you finish study at 25 and work till 60 that gives you a working life of 35 years. If you are paying off your student loans for 25 years, student loans will be taking your money for all but 10 years of your working life.
And what if you spend several years unemployed? Many employers won’t look at you after you are 35.
And that’s before you take out a mortgage!
If you are a man, return every day to the Salvation Army or other Opp Shop until you find the suit that you need to impress your future employers without needing student loans. Once you have a job you can wear the suit every day. It doesn’t matter if you wear it out – it only cost you $10.
If you are a woman, buy a second-hand sewing machine and learn to alter clothing. Buy garments at the opp shops and modify them to look fashionable. You can still have a good variety of fashionable clothes but they won’t cost you much if you are clever. That is a skill that will serve you for the rest of your life. Remember every $100 you save means you can earn $400 less to pay your student loans.
You could also do dressmaking repairs and alterations for a suitable fee to help stretch your money a little further.
Other ways to economize
Buy second-hand whenever possible – even your textbooks. Clothes from the Salvation Army are cheap. Use eBay, but don’t buy anything you don’t need. My first boss told me that I had furnished my house for less than he spent on his bedroom. I used furniture auctions.
Negotiate – This is important with second-hand goods, but even more important for new goods. When you go in to buy a new fridge, (don’t buy one if you live in Alaska) the attendant is waiting to see if you are stupid enough to pay the price tag, or if you will ask for a discount. Ring around for the best price, then say to the vendor “I can get it for only $… from this shop.”
They may give you a new price to beat the competition. Try to get discounts for cash, or for delivery, or ask for a kettle and a coffee-maker to be included in the bargain. Remember they don’t pay as much for the kettle as they charge you so they like that better than cutting the price.
Remember a dollar saved is four dollars in student loans that you won’t have to pay back.
Of course, this page is just about my own opinions. You can read the ideas of scores of other writers about student loans.
Next in part II you can read the advantages and disadvantages of student loan consolidation in case you haven’t been able to avoid college loans completely. What you should realize is that your economizing skills and your part-time earning skills will carry over to your student loan consolidation and to the rest of your life.