View Full Version : Debt Trap: College Borrowing Catches Up

04 April 2009, 10:03 PM
I think this is an important warning for high school students about to go to college or for current college student, regarding student loan debt and credit card debt:

Debt Trap: College Borrowing Catches Up (

05 May 2009, 01:29 PM
A very good wakeup call!
We have very ruthless credit (lending) companies in Holland, who when after you do a little research find they are also repossession businesses. So the sunny happy adverts from the lending guy IS the dark and relentless repo guy. Sucking money from both ends.

Have no illusions about these people. Salesman gather in a bar after work and boast about how many suckers they hooked that day. Don't be one of those suckers.

Great post Rebeccak

05 May 2009, 05:54 PM
This is a good post, and overall a very true issue- but that particular video is a bad example. The guy admits at the very beginning that he's always been bad with money, and says he missed a payment "one or two times". Can credit card companies really be faulted for him not reading the fine print when he signed up? You can't even really call it a predatory practice, because there are millions of americans who pay their bills on time and don't get hit with these ridiculous fees. I will concede that there needs to be some reform in this area, maybe even a three-strikes type rule, but this particular guy seems like a leech who's trying to dodge financial responsibility.

Who goes to school for four years, gets a bachelors, and then works for 16k a year? I was making more than that working at pizza hut after high school...

05 May 2009, 11:20 PM
eldee, I agree that the guy in the video is a dolt, but I have to say the larger issue is just that even smart people can get caught in a debt trap - a friend actually had pretty much the same response as you to this post, here is what he wrote:

Eh ... can't say that I'm sympathetic to this (one) guy. Most people don't go to college if they know they can't afford it. That was his first mistake. Financing his living expenses on credit cards was his second mistake. Being stupid enough to have a NYTimes feature video of him reporting stupid mistake #1 and #2 would be his third mistake. Three strikes! This dude is out!
Here's my response:
Well, "some plan" is sometimes a massive loan that most students at 18 are ill equipped to understand the ramifications of. I teach high schoolers, and I can tell you that they are clueless when it comes to what rent, bill payments, and loan payments are. I think this story is a cautionary tale. For sure, he wasn't the brightest on the block, but smart kids can take out big loans and get snookered by life too - anyone can get injured and not be able to work, and they will end up with a debt that they can't pay back...who knows what peoples' situations are.
Mainly, I think that it's important for students to think about these issues now before they take on massive debt loads. Life is unpredictable, witness our current economic situation and recession. It's especially relevant for all those art students who may or may not end up with a massive payday as soon as they graduate.

05 May 2009, 04:45 AM
Totally agree, there definitely needs to be some reform.. I saw something recently where a credit card company was allowed to set up a little display on campus where students could walk by and sign up for instant approval.

But to be totally honest, the reform needs to be on a larger scale. We've reached an era where we're at diminishing returns in regards to the cost of education versus the amount of money we make when we graduate. I read an article recently that illustrated this point nicely:

05 May 2009, 04:56 AM
But to be totally honest, the reform needs to be on a larger scale. We've reached an era where we're at diminishing returns in regards to the cost of education versus the amount of money we make when we graduate. I read an article recently that illustrated this point nicely:, yeah I've seen and blogged about that article...since I interact with a lot of students, debt is something I've been thinking about a lot lately.

This is particularly the case because I'm seeing the fruits of some of my personal life choices playing out - though at the time it didn't seem like a lot of fun, during grad school I opted to work full time and only take a class at a time - work paid for some of it, I paid for a lot of it, and in addition I had some family help. Thanks to the fact that my parents had frugally saved for my college education since before I could walk or talk, I walked out of 2 private schools for my undergraduate education and a public school for my graduate education debt free. But I realize that not everyone has this situation, and I really want for current students to be scrupulous about how they will consider funding their own educations.

This is particularly true because with the increase of outsourcing, etc., people will need to be able to fund continuous education over a long period of time. There is a really great book that I have recommended to students in the past called "The World is Flat" by Thomas Friedman - it talks about the impact of outsourcing on the American economy and about how Americans will need to adapt to an increasingly equal opportunity (or flattened playing field) in terms of the global economy.

Students have to be smarter than ever and be able to fund their educations for longer than ever, in all liklihood...I feel sad for the students I see who are in private school wasting their parents' money by slacking off or not doing the best that they can - these students would be best off in community colleges, not private schools - until they grow up and are able to handle a proper course load.

CGTalk Moderation
05 May 2009, 04:56 AM
This thread has been automatically closed as it remained inactive for 12 months. If you wish to continue the discussion, please create a new thread in the appropriate forum.