Brett’s Story: The Price of Debt

Meet Brett, a full-time student living in Indiana, Pennsylvania who’s pursuing his PhD degree.

What do you do?
I’m in the second year of my program at Indiana University, pursuing a degree in Literature and Criticism. It’s the study of literature but using theories and criticism to discuss different pieces.

What did your upbringing teach you about finances?
As a child up through graduating college, I was really not taught much about saving money. My parents were probably bad roles models in that sense. They used credit cards to pay for everything and would only make monthly payments. Goodness knows how much they paid in interest in their lives.

When I got older, it was extremely easy to get credit in the late 80s. Every student in college I knew had three or four credit cards. Every week, there would be someone on the street corner who asked, “Hey want a credit card? You’ll get a free t-shirt!”

Most people I knew had 25% APRs. If you were smart, you paid it off. If you weren’t smart, you made poor decisions. I understood the concept on paying interest and not wanting things to end up costing more than what I paid for them.

What are your lowest and highest financial points?
Probably a few years ago I experienced my lowest point. I had recently left a position in 2016 where my job paid for my food and housing in addition to a nice salary. I had to find a place to live. I did okay for the first couple of months because of severance pay. Once that ended, I was just living off my savings. I went from having a nice savings nest to having nothing.

My financial high point would’ve been the beginning of 2016 when I still had my position. I was doing very well and saving lots of money. I was able to put money in my Roth IRA and SRAs; I felt like I had multiple lines of savings.

Have you found it possible to save since losing that position?
I’m just increasing my debt each semester with my loan check that helps pays for bills. I put that money in my savings, and it pays through the semester. The hope is once I graduate and get a real job, that I could save from there.

I don’t know how one can save when they’re a student. The reality for most is, “How can I save when I should be paying off debt?” Where I am, savings accounts are paying less than what my debt costs.

How did you know where to start saving?
I worked in higher education and it’s a good line of work that offers workshops to help you gain knowledge. Most of my money is saved through TIAA. They were good about offering workshops and one-on-one counseling.

What’s one thing you know about money now that you wish you could tell your 18-year old self?
I knew a girl in college. She and I took a few classes together. I admired her greatly because as she went to school, she was working throughout. She was a dedicated housekeeper who would never go out to eat.

I just can’t imagine living my life so restrictively as I went through college. For me, I’d rather have debt in college and have life experiences than not live. I was able to travel to multiple countries in Europe and Russia. I can’t say that I regret the choices I made when I was in college.

You could end up being 40 with no debt because you sacrificed as a young person, but I don’t know if you’ll be any better off from a life satisfaction standpoint.

What does money mean to you in your life?
It means opportunity. Going somewhere, buying something—it all involves money.

What are your savings goals?
Soon I’ll be applying for a teaching assistantship. If I get it, I’ll be teaching two classes each semester. I’ll be paid $25,000 a year, so I’ll be above the poverty line. If I get the position, I’ll have access to the university’s health insurance, and I won’t have to take out any more loans. Getting this assistantship would open up a lot of opportunities for me and help me build my savings.