The other argument I hear about student loan debt being good debt: the magical student loan deduction. It doesn’t help a whole lot as it is capped at $2500 (I’ve been paying upwards of $7000 in interest each year since I graduated 5 years ago). And a deduction is just that: it’s a deduction from your gross income. It doesn’t lower your taxes by $2500, but simply changes your AGI. Meaning if you’re in the 25% income tax bracket, it really saved you $625 for the year. Better than nothing, but that doesn’t even meet most graduates’ minimum monthly student loan payment.

Trust me…the debt for law (and from what I’ve heard medicine as well) is not worth it. Law school is so unbelievably expensive. With the current state of the legal market, there are so many law school graduates who are unable to find any employment in the profession. I would never recommend the legal profession to anyone, unless you have someone generous enough to pay your way through school or you have a solid connection that pretty much guarantees employment after graduation. Much of the blame can be attributed to the law schools, who continue to admit an ever increasing number of students despite the fact that there are fewer available jobs within the legal profession. Greedy schools combined with an inept ABA spells disaster for newly minted lawyers.

The other argument I hear about student loan debt being good debt: the magical student loan deduction. It doesn’t help a whole lot as it is capped at $2500 (I’ve been paying upwards of $7000 in interest each year since I graduated 5 years ago). And a deduction is just that: it’s a deduction from your gross income. It doesn’t lower your taxes by $2500, but simply changes your AGI. Meaning if you’re in the 25% income tax bracket, it really saved you $625 for the year. Better than nothing, but that doesn’t even meet most graduates’ minimum monthly student loan payment.

If you mean ‘a different decision’ 45 years ago, of course I would — knowing what I know now. If you mean in 2005 when I began college, probably not. I already had some credits toward a theater degree; the loans were not only cheap (my interest rate is 3.5%) but generous (I actually used some of my Stafford loans to fix up my home) and I wanted to finish something I’d left for all the wrong reasons those many years ago. And who knows — if I really HAD to, I could probably get a (miserably paid) job in the field.

Very true. It doesn’t matter where that big check is going each month… Bottom line, that money is not yours.

Thank you for your unique perspective! If you had the chance to go back and make a different decision, would you?

That will be very interesting to watch develop. I think this is one area where spending takes a long time to adjust to the realities of the market. I think the idea of college always being a good thing is so ingrained in our society that it will take a long time for people to finally realize that some places are outrageously expensive.