You guys, you’re supposed to feel pumped up and hopeful when you finally get that college diploma. Instead, I see way too many young people overwhelmed with student loan debt and worried about how they’re going to pay it off.
The whole concept of debt reminds me of this Scripture:
“For which of you, wanting to build a tower, doesn’t first sit down and calculate the cost to see if he has enough to complete it? Otherwise, after he has laid the foundation and cannot finish it, all the onlookers will begin to make fun of him, saying, ‘This man started to build and wasn’t able to finish’” (Luke 14:28–30 HCSB).
Listen: I’m not here to make you feel bad if student loans are part of your story. I’ve totally been there. When I was in college, I was more than $25,000 in debt after just three semesters! All I’m saying is, it doesn’t make sense to jump into something before you have the foundation—and the funds—to pay for it.
Student loans might seem like a reasonable way to pay for college. But the truth is, it’s borrowed money. It’s not really yours—and having debt is a surefire way to hold yourself back from pursuing the goals and dreams God has put on your heart. His Word also says that the borrower is slave to the lender (Proverbs 22:7 CSB). As children of God, we don’t need to be slaves to anything. We’re supposed to live in freedom!
Too many young adults (and even their parents) think that taking out loans is just a normal part of going to college. But “normal” is not setting you up for success—and it’s why we have a $1.6 trillion student loan crisis on our hands.1
Still wondering about the effects student loan debt can have on your future? Let’s do some math (I get it––math is boring. But stick with me!).
How Much Do Student Loans Actually Cost You?
The average amount of student loan debt per student at the time of graduation is about $35,000. And the average monthly student loan payment is $393. In that case, you’d be making those payments for years (maybe even decades) after graduation and building up interest the whole time—meaning you’d end up paying way more than the original amount of the loan.
(Side note: Monthly student loan payments usually add up to somewhere between 5–15% of graduates’ income after they start their careers. Just think about graduating from college and landing a job you’re excited about, only to hand over 15% of your hard-earned cash to the lender. Not fun.)
But what if those monthly payments were invested instead? If you invested $393 per month for 30 years (starting at the age of 21) with a 10% annual return, you’d have over $1 million by your early 50s. That doesn’t even count any other savings or investments you might have at that point.
If you did the exact same thing but waited until 67 to retire—which is the age you can retire with full benefits—you’d have about $4,107,517 just from investing that little $393 every month. Crazy, right? That means your student loans are actually costing you millions of dollars.
Investing aside, what else could recent grads do with an extra $393 per month? The list is endless. That’s money toward a wedding venue or a down payment on a house. That’s your foundation for the business you’ve always wanted to start. That’s a gift that could seriously bless someone in need. There are so many better ways to spend that money than a student loan payment.
So you might be thinking: Okay, Anthony, I get it. Student loans are the worst. What’s the alternative?
I’ll be real with you––it won’t be easy. It will take a lot of hard work and sacrifice. But I promise you: No matter what the rest of the world tells you, cash flowing your college degree is possible.
Here Are Three Tips to Help You Go to College Without Student Loans.
- Go to an affordable school.
That might seem like a no-brainer, but you’d be surprised how many people are willing to take out thousands of dollars in loans just so they can go to their “dream school.” Y’all, going to your dream school does not dictate the outcome of your future––you get where you need to be because of your character, your work ethic, and a whole lot of prayer. Let me say it louder for the people in the back: The true dream school is the one you can afford to go to without debt.
That could mean going to a trade school, community college, or public, in-state school instead of a private school. (I mean, there’s about a $25,600 difference in a year of tuition and fees at a private college versus a public, in-state college.6)
- Apply for scholarships.
You guys, this is free money that––unlike loans––you don’t have to spend years of your life paying back. You can find the free money by:
- Filling out the FAFSA form (which can also be used to get loans, so read the fine print and don’t sign up for anything unless you’re sure it’s not a loan)
- Asking the financial aid office at your school(s) of choice about the scholarships they have available
- Researching organizations in your field of interest to see if they have scholarship opportunities
- Using an online scholarship search tool (like the Debt-Free Degree Scholarship Search)
- Work, work, work.
I’m a big fan of work-study programs, off-campus jobs, side hustles, babysitting gigs—anything that can help you stack cash for your college degree. I recommend starting to work in high school and keeping a part-time job (no more than 15–20 hours per week) once you start college.
As long as you don’t let it hurt your grades or stop you from getting enough sleep, having a job can actually help you. You’ll build all kinds of skills you’ll need to succeed in the workforce—like managing your time, serving others, and being responsible with the money God’s given to you.
Another thing to remember is that you don’t have to pay for your entire college degree up front. You can work and cash flow it as you go! Once you take debt off the table and make the decision that you’re going to do this debt-free, you will.
Want More Advice on Going to School Debt-Free?
I’m passionate about helping you avoid the same mistakes I made with money––that’s why I wrote Debt-Free Degree. It will give you a step-by-step plan for prepping for college the right way so you can graduate debt-free and be ready for whatever God has in store for you.
Your future: 1. Student loans: 0.
Since 2003, Anthony has helped hundreds of thousands of students make smart decisions with their money, relationships, and education. He’s a national best-selling author and travels the country spreading his encouraging message to help teens and young adults start their lives off right. His latest book, Debt Free Degree, launches October 2019.You can follow Anthony on YouTube and Instagram @AnthonyONeal and online at anthonyoneal.com or facebook.com/aoneal.