Part of the fortunate few
That first day of college is burned into my memory. Mom dropped me off, and I can still feel that vague discomfort in realizing I was independent. Perhaps more accurately, I felt alone. Instead of seeing my brother every day, it was my new college roommate — a heavy metal aficionado. Despite his taste for incomprehensible music, we actually got along (I think).
Both of us had the privilege of parents who saved and paid for our college educations. My undergraduate years were financed through various investments in stocks, bonds, and mutual funds. Another way many parents save is through 529 College Savings Plans, which provide tax benefits for a child’s college education. Unfortunately, future college students don’t always have it this easy.
Suffering from rising tuition, fees, and state tax cuts
Americans are in trouble. There’s a confluence of events that’s acting as a perfect storm for adolescents: people save less than ever, tuition costs are on the rise, and state tax revenues for public education are severely constrained.
About 75% of households only have enough in savings to pay their bills for 6 months. A Huffington Post reporter interviewed one person who said,
A single mother of four living in Bangalore, Maine, Norton says she often writes checks for bills without enough money in her bank account to pay them, hoping the check won’t clear until her next paycheck arrives. Between rent, child care and other necessities, Norton says her expenses cost more than she earns, leaving her without a cushion to fall back on in case of emergencies.
Tuition fees are increasing at far greater rates than inflation. Effectively, this is stunting parents’ and future college students’ purchasing power, and leading to nauseating levels of student loan debt. The New York Times found that,
At public four-year colleges, the inflation-adjusted average annual increase has been somewhat higher, thanks mostly to state budget cuts: 2.3 percent (which translates into almost 5 percent a year in nominal terms). At public two-year colleges, also known as community colleges, costs have fallen relative to inflation, at an annual rate of 0.3 percent over the last 20 years.
A caution: these increased tuition rates do not account for greater student loan debt and the possibility of being charged upward of 6.8% active interest to be paid off after graduation. If you account for this, real tuition costs are skyrocketing. This is the burden of students, parents, and our greater society.
The tuition is too high
At a private institution such as Duke University, you’ll be staring at a whopping bill for about $61,404 a year. Just for some perspective, the World Bank suggests that the average per capita income in the United States is $51,749. For four years at Duke, you’ll be staring at about five years of income — in debt.
Maybe you’re wondering why I chose one of the most expensive schools in the country as an example. My simple answer is twofold: 1) Duke University is highly prestigious and well-regarded by both employers and future students; 2) Two of the craziest stories come from this institution.
You won’t believe what college students are doing to make ends meet. For some, desperate times call for desperate measures. The following are 3 real-life examples of students saving and paying for atmospheric tuition costs.
Ken Ilgunas: Walden on Wheels
Ken Ilgunas had finished paying off undergrad loans when he decided to return to Duke for a graduate degree. Before starting the program, he was determined to avoid more students. In his New York Times article, Ken says,
I HAD been accepted into Duke’s graduate liberal studies program, but I couldn’t afford it. I had just paid off my $32,000 undergraduate debt, I was nearly broke, and the prospect of taking out loans was unthinkable. Going back into debt made about as much sense as running out of a burning building just to run into another.
His solution was to buy an older Ford Econoline van for $1,500 and live out of it for the duration of his schooling. Using the library for Internet, rec center for showers, and a camping stove to cook food, Ken successfully went to graduate school without accepting defeat and taking out loans.
Ken utilized his writing skills to pen a beautiful book called, Walden on Wheels. The book focuses on minimalism, living debt free, and his journey at Duke. With national attention, a New York Times article, over 300 (mostly) positive reviews for his book, and even a visit to Letterman, Mr. Ilgunas is an inspiration for vandwellers worldwide. More importantly, he did something truly extreme to avoid student loans and pay for his tuition. It worked.
Belle Knox: Full-time student, part-time pornstar
Belle Knox (her chosen pornstar name) is an 18-year-old student at Duke University, who is studying women’s studies and eventually wants to go to law school. Many of her peers pick up side jobs to pay for some odds and ends amidst piling student loans. Belle decided to take up a different line of work and searched Google for, “How to become a pornstar.”
She’s headline news everywhere. Rolling Stone calls her the “top new adult-film” actress and a “studious college freshman.” Dr. Drew featured her on his show and said he’d be, “chompin’ down on cyanide capsule right now [if I was your father].”
When Belle talks about her pornography experiences she says,
I can say definitively that I have never felt more empowered or happy doing anything else. In a world where women are so often robbed of their choice, I am completely in control of my sexuality.
From there, Belle found a talent agency and started flying across the country — mostly LA — to film scenes on the holidays and school breaks. Each scene filmed equates to about $1,000. After about 61 scenes a year, she can completely pay for her exorbitant tuition demands. She’ll avoid the fearful debt this way.
Steve Stanzak: Finding affordable housing in the library
When you’re staring at around $55-60,000 a year in total costs, you’re bound to get creative. When Steve Stanzak of New York University struggled to find affordable housing in New York City (imagine that!), he decided to go rogue and live in the library basement for 8 months.
USAToday interviewed him and they found that,
…He began spending six hours a night in the sub-basement of Bobst Library at the beginning of the academic year after he was unable to pay a $1,000 housing deposit.
He slept on four library chairs and carried vital belongings — a laptop computer, books, clothes — in his backpack. He kept other items, like toiletries and clothing, in storage lockers.
Here’s the crazy part: they caught him because he used an online journal to catalogue his journey. Imagine if they never caught him?! How long could he have managed — putting four chairs together in the place of a bed?
In a strange twist of fate, Steve was rewarded for his library dwelling when NYU offered him a free dorm room. Success!
What’s reasonable when tuition costs are unbearable?
When I searched Google for “ways to pay for college,” I got some fishy results (i.e., Forbes, Fiscal Times, and Huffington Post). Frankly, none of the articles actually help people pay for college. Most just regurgitate old information about getting financial aid (aka, student loans). The worst is the Huffington Post article, which suggests paying for college with “cash” (they must be getting creative to rank higher in searches). I would imagine most people understand that cash is a monetary tool for paying bills. Not sure who’s benefitting from that horrible advice!
I remember feeling hopeless to do anything about my student loans prior to starting Frugaling. The debt piled higher and higher — without escape or end. When I finally faced this reality, I suddenly saw a way out.
It’s easy to get desperate when you see interest-bearing accounts metastasize with ever-daunting sums. Ken Ilgunas, Belle Knox, and Steve Stanzak are three people that used this extreme fear of student loans to prevent them from falling prey to them. Question their legality, morality, and safety as much as you want, the three of them found a way to make their educational dreams a reality.
Significant student loan debt is a scary place, and it seems like these three reacted in powerful ways to stem their deficits. But it makes me wonder, is it even worth it at some point? When is a graduate degree, while in a Ford van worth it? When is it worth becoming a sex worker (aka, pornstar)?
Their stories are hard to hear though. These are the most motivated, enterprising, and smart people in our country and they’re struggling to get a top-notch education. It makes me wonder if we are making it too difficult for people to attain this level of education – preventing new leaders from finding success in our society.
This is just the start, too. As tax revenues continue to fall for public education and social inequality rises, stories like this will only increase. The United States seems to be leaving our future generation in the dust. You can’t pay for a college education with a couple simple part-time jobs over the summer. Those days are long gone.
How can you lead when you’re swimming in debt and held back from the freedom to become more than just a number to a lender?
Marie @ IRA vs 401k Central says
All prices now really do increase, especially the tuition fees. My younger sister who is a second year college this next school year, she is taking up a Bachelor of Nursing is just one of the expensive cars in my country as of now. Since our father passed away 9 years ago and my mom is a full time mom, me and my brother decided to help my sister financially.
Dee @ Color Me Frugal says
Wow, things are pretty sad when you have to become a porn star to get an education! And I think it’s hilarious that they never would have caught that guy living in the library if he hadn’t blogged about it! Score for the free dorm room though.
Sam Lustgarten says
Dee,
Haha. Yes, it’s getting pretty extreme. As much as this is a highlight of three crazy students working their butts off to save money and pay off tuition fees, it’s also a picture of the terrible burden that tuition has become. Hope we can change something over the coming years.
Thanks for your comment,
Sam
Broke and Beautiful (@brokeandbeau) says
Haha, why didn’t I think of just paying cash? I don’t get why people are so up in arms about the pornstar thing. She’s happy doing it and she’s paying for a rockstar education, good for her.
Sam Lustgarten says
Stefanie,
Can you believe that advice?! Craziness. Can’t believe people get paid to write such drivel.
As for Belle Knox, I’m in agreement with you. It’s shocking how the popular media latched on to this woman’s career. It probably wouldn’t have happened if she attended a lesser known university (both for prestige and terrible sex/abuse scandals).
Thanks for your comment,
Sam
Mel says
Too bad he got caught living in the library! When I was in grad school, I was working on my thesis in some creepy subbasement where I never saw anyone. I remember thinking that I could totally live down there like some creepy library lurker and no one would have a clue. It would’ve been WAY cheaper than my rent.
Sam Lustgarten says
Mel,
Hahah. I don’t think I would’ve wanted to do it at my library. Not only did it close at 10 pm, the basement was pretty creepy and poorly lit. EEK! There are ways to have a better living environment that’s legal and safe. Most people need to do some serious research on Craigslist for an affordable, high-capacity living space. 🙂
Thanks for your comment,
Sam
Jen @Sprout Wealth says
I find it saddening and alarming too that most people nowadays have to resort to strict frugal living, some to shocking amounts of debts. Still, it isn’t enough because prices keep rising but the income is really slow. How frugal can one get, really, so that the money that comes in is enough?
maria@moneyprinciple says
This is hat we’ve managed to do to our young people: education ahs become so expensive that if you don’t have really wealthy parents you have to resort to professional choices like being a porn actress. Of course the girl tells us she feels completely empowered: she can’t very well say I feel sexually exploited and I am in a dodgy business. I just read a book called ‘Think like a stripper’ – it is very good but the author (who did something similar, she worked as a stripper to be able to get her degrees and not get in debt) had to deal with the damage for a decade.
I may be just sad and completely wrong about this one. Is it better to write a porno novella rather than act in a porn movie?
Sam Lustgarten says
Maria,
Oh boy! You ask some tough questions, and I really appreciate you sharing them. It’s terribly complicated, isn’t it? All I know is that our tax system doesn’t favor broke college students. At times, it motivates them to pursue some crazy ways to save or earn more.
Thanks so much for your comment.
Sam
Kalen @ MoneyMiniBlog says
Interesting. These are some of the more unique ways I have heard of to fund college. I think it’s interesting to see how creative people can get, but the porn star thing may be a little far (IMO!). I am investing to fund my children’s education, so hopefully they will never be face with this decision.
Sam Lustgarten says
Kalen,
I’m really glad to hear that. As much as these students found ways to found or save for their educations, the costs psychologically can be great. Thanks for reading and commenting. Means a lot!
Sam
Tommie says
I’m honestly considering the Van thing. I have an unfinished counseling psychology Masters at a Northern California university. Finishing it would mean a huge change in my life and career. I have friends who I started with who either finishing or done. They all are working or moving towards doctorates. The thing is I’m broke and pushing into middle age – so I’m no young-in. I wasted years working in a corporate job I hated, because I needed to pay off loans and debt. Of course I’d do an affordable van sized RV instead. Those can be parked at cheap RV parks or for free if you’re smart. That would be enough in savings to complete my masters (I literally have a 16 months or so left!). But I’m broke and there’s no way I can work full time. Also funding for professional psych, just forget about it. It’s impossible to get. I was actually friends with a guy slightly younger than me who did it. He swears it was the best decision he ever made.. and anything beats being stuck in a dead-end office career that you hate… for life just because of money.