It's been a trying time for many people, financially speaking, and it recently came to my attention that I am definitely in the "Shit, I'm Broke" category.
Meg said it best when she said that the simple fact of the matter is that no one making under 2k a month can recover gracefully from a medical emergency. Even though I have benefits, this is certainly true.
Still, it's been emotionally trying. No matter which way I look at it and regardless of the fact that I know I have not been irresponsible with my money in any way, I feel a lot of shame. The people I call to to try to find solutions treat me as though I'm some irresponsible teenager who spent her paycheck on hookers and blow. They are not interested in assisting me and even though I genuinely want to pay them they are entirely inflexible. The system is not built to help the consumer, and this is a problem.
The biggest problem lies with my private student loans, which I am extremely resentful about right now. Not only did I not want them in the first place -- I would have preferred to have gone all federal but my mother insisted on otherwise and even lead me to the company currently giving me all this grief -- but I am not able to qualify for any kind of forbearance or adjust the terms of my loans to lower my payment. This particular lender will also not allow me to consolidate my loans with them to lower my payment. Here's some hard-learned advice:
- Avoid private student loans at all costs unless you know the company has a range of options for you after you begin repayment. Some things to look for include multiple available forbearance options, the ability to change the length of repayment (10, 25, even 50 years), consolidation options, etc.
- Really, really, really know exactly what you're getting into. If I had read consumer comments about this company when I was 18, I would not have entered into contract with them. This is my fault for being naive and thinking that my mother had done the research and/or would help if I needed it.
- Avoid signing anything that will definitively lock in the repayment period unless you know you will not have problems making the payments. Remember that you don't have a job guarantee after college, and just because there are salary averages in your chosen field, that doesn't mean you're going to get the average.
I didn't know that when I signed the documents I was basically saying that come hell, high water or even unemployment I would have this loan repaid in full in just 9 years. I thought I would be able to adjust it to 50 years if I couldn't find work or lost my job and was wrong, which is my fault.
Still, when I signed I didn't think that 250 a month would be unmanageable, so I went for it. I figured my degree would get me a good-paying job and that $250 would be like pocket change. Not so. It's an 8th of what I make every month, and that does not count my additional federal loans. My monthly student loan payments combined are more than my rent.
- Consolidate your loans if you can. I was skeptical of this, and for awhile I ignored all offers to consolidate from outside companies because I thought they were scams that would raise my interest rate and again, I thought I'd be able to make the payments even though I had now learned the cost of living was higher than my teenage self had anticipated. Now, I'm paying interest on multiple loans instead of just one bundle, which makes each individual payment larger.
- Be aware that private and federal loans apparently cannot be consolidated, which is why it's best to either go with one or the other if possible. In my experience, the federal loans tend to be much more understanding, willing to negotiate, and don't make you feel like an asshat.
- Do not let them talk you into "paying interest only for the first few years while you get yourself established." I looked at a payment schedule, and this is the student-loan equivalent of an adjustable-rate mortgage.
- If you have cosigners, make sure they are actually willing to help pick up your slack if unexpected troubles befall you. Mine aren't, and because of their salaries and their ability to pay, I am disqualified from any kind of assistance even though they are unwilling. This is probably the most frustrating and emotionally taxing thing of all.
I will be alright. I won't overdraft. I will stay afloat, but things are tight. I am not comfortable, and this lack of money makes me feel anxious and caged. Every time I deny an invitation to go out, I feel like I'm being punished. It's like money has slapped me on the wrist, sent me to my room without supper, and is now telling me that I am grounded for two months until I can get my act together.
Despite my desperate urge to be fully independent of my family -- which I am, it breaks my heart to know they don't have my back on this, and one more little crisis will leave me completely up shit creek without a paddle.