Lifestyle trends for recent college graduates in the U.S. are shifting. Landing a job after school, buying a house, and settling down to start a family is not always a standard path of life as it once was in past decades. Rising debt from student loans are causing many graduates to move back home with their parents, and work to save enough money to become independent and stand on their own feet.
I credit most of my student loan debt toward my decision to venture out-of-state for college. Sometimes, I wish I had stayed in-state just to eliminate the stress of paying 10 – 15 years’ worth of debt. That’s not to say I didn’t enjoy my four years at Towson — I loved it there! After all, that’s where I met my girlfriend.
Overall, my point is that choosing schools far from home is overrated considering today’s economy. When I was younger, I used to dream about going to Kansas State — my parent’s alma mater — only because I loved the football and basketball programs. As I grew up, I realized my parents were right – picking colleges should not revolve around team affiliation.
Aside from my experience, the majority of today’s college grads accumulated their debt for a multitude of reasons — high out-of-state tuition fees, lack of financial assistance, graduate school, or an extended college career possibly due to switching majors. And, the resulting effects are tenfold.
About 2.8 million recent college graduates across the nation, including myself, deal with numerous residual effects stemming from student loan debt that will most likely impact our finances for years to come. Here are three major issues I’m currently dealing with on a regular basis:
- Financial stability
First and foremost, my goal is to make money. Just like most young professionals my age, top priority is saving as much as possible to have a fallback and start planning for the future. But, it’s not a simple process. Even though I’ve moved back in with my parents, I still have plenty of financial responsibilities like student loan payments, car insurance, gas, and credit card bills. And yes, I know that’s life. But that’s why I’m so thankful my parents welcomed me home with open arms, because I would barely be scraping by if I was living on my own right now.
Nonetheless, the toughest part about moving on from college is learning how to accept the hole you’re in, and move forward with a plan. Financial stability isn’t stressed enough in school. My parents and girlfriend, Diana, taught me about personal finance more than anyone, just over the past few years. I used to think I had personal finance all figured out. Now I realize saving money and paying off loans take time. Still, I would be far more optimistic if I didn’t feel like I was 22 feet deep in student loans.
- Personal independence
I’ve been out of college for exactly one year. After starting a full-time job right after graduation, I thought I had made it. At the time, my life goal was to provide for myself so that my parents wouldn’t have to worry about supporting me anymore. And, life was good for the most part. I was living away from home with a friend from school and paid my own bills. But everything changed once things came to an abrupt end just five months into working my first real job. Thankfully, I found a new job right away (a mere five weeks) after losing my first, with a great company that has given me a ton of potential for a solid career path.
Suddenly, I began to realize how much I still had to learn about transitioning in the real world. It’s one thing to have a job and make money, but there’s higher value in understanding how to save, taking on more responsibility, and expressing gratitude toward the people who supported you in the first place.
Aside from finances, many young adults struggle with independence. I know plenty of people my age who don’t contribute around the house, yet they selfishly save their money when they could at least be thanking their parents from time to time. A former coworker of mine even had her parents still doing her laundry…at 23 years old. In most normal households, acts of self-entitlement like that don’t fly. In my house, I try to help with dishes, trash and recycling, cooking and cleaning, groceries, and other errands for my parents on a regular basis. The way I see it, if I can provide for myself then I can at least give back to those who supported me.
- Long term goals
A popular question often asked during job interviews is, “Where do you see yourself in the next ten years?” My goal is to marry Diana, buy a house, and start a family — essentially the American dream. Obviously, achieving that dream isn’t simple. And I spend a lot of time wondering how I’m going to reach those goals.
Currently, debt is the biggest obstacle standing in the way of my dreams. Student loans are something I hope to pay off before I get married and settle down. In the near future, Diana and I are planning a winter vacation somewhere tropical. We’ve discussed budgeting via a helpful app called Mint (which helps users set budgets, financial goals, and categorize their expenses), so I feel confident about saving enough for our trip.
But, what about a new car? My 13-year-old RAV4 already has about 150,000 miles on it. How about moving out? I can afford rent in most places, but how much will I be able to save with my current salary once I’m on my own? And, what about an engagement ring? I have no clue where to even begin with budgeting for that kind of purchase. Loans are always an option, but I have enough of those on my plate to deal with.
Life isn’t cheap; I know this much to be true. Quite often, I build up a great deal of mental pressure from my parents, peers, and society. Knowing how hard my grandparents and parents worked to give me such wonderful opportunities in life, I only want to do the same for a family of my own. And unfortunately, society tells us that success is measured by the house you live in, the car you drive, and how much money you make. Of course I want to be successful. But, it’s hard to meet those goals on what can often seem to be an insufficient salary. It’s easy to buy into how the American dream defines success. However, I’d like to believe there’s more to success than money and materialistic values. I feel accomplished from graduating college in four years, meeting my dream girl, and making enough money to take my parents out once in a while.
For other recent college grads out there dealing with similar thoughts, you might find this personal finance-related article I stumbled upon very interesting and insightful.