Not long ago, my kids began claiming “It’s not fair!” whenever anything didn’t go their way. Trying to curb the habit, we are constantly reminding them what “fair” actually means.
The rule is that if you finish your dinner, you can have dessert. When only one child finishes dinner and gets dessert, the others cry, “It’s not fair!” Actually, the problem for them is that it is exactly fair. The result is perfectly in accordance with the rule. The children without dessert wish to be treated unfairly, that is, wish that the rule applied differently to them than to others.
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Recently I was reading a discussion on different student loan payment programs. As you probably know, several payback plans for federal student loans offer loan forgiveness after 10-25 years of payments, depending on the plan. One poster in particular grabbed my attention.
He was enrolled in the Income-Based Repayment (IBR) program, where the payments are set at 15% of discretionary income and any remaining unpaid amount is forgiven after 25 years. A newer program called Pay As You Earn (PAYE) sets payments at 10% of discretionary income and forgives any remaining balance after just 20 years. The poster was complaining that the PAYE program was just not fair because he did not qualify for it.
This irked me. Of course those programs aren’t fair! If you’re in them, you better be thankful that they are not fair. The only FAIR thing is to repay the loan that you took out, in full and with interest, on the original schedule you agreed to when you signed the dotted line. That is JUSTICE.
Understanding that education is expensive, the job market isn’t always so hot, and student debt is a huge problem for young people, the federal government has decided to extend MERCY. Mercy comes not because you deserve something, but because someone (or some entity) is giving you another chance, tempering the strict, perfectly fair, demands of justice.
All of us sometimes wish for MERCY, for a less strict application of consequences than JUSTICE would require. The feeling that you deserve mercy, that you have somehow been wronged by being held to the standard of justice, is at the heart of the sense of entitlement that younger generations (including my own) are accused of. The problem with such a feeling of entitlement is that it allows you to escape a feeling of responsibility for your actions and acceptance of their just and fair consequences.
When you’re getting out of paying thousands (even hundreds of thousands) of dollars that you borrowed fair and square (as the entitled poster was), can you really play the “not fair” card?
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Don’t get me wrong. I am thankful for the programs the federal government has for paying back student loans. We’re thankful that through IBR we don’t have required monthly minimum payments (though we’re still motivated and determined to pay off our debt in full as soon as possible). I’m just not a fan of the “It’s not fair!” and “I deserve” attitudes that I sometimes see when people discuss their hate of debt.
I hate having debt too, but I take full responsibility for it (well, joint responsibility, we’re a team, remember?). There is power in taking responsibility.
It’s Your Turn
- How has taking responsibility for your debt and finances helped you feel empowered?
- How do you avoid “It’s not fair” and other thoughts of entitlement?
The government is not about showing mercy. When they say they are, they lie. Everything the government does or “gives us”, comes with huge strings attached and costs all of us somewhere along the line.
Wow, Stephanie. What a great topic to write about, and you do it so well.
I personally think that we’re all here (in life) to learn lessons that are designed to help our spirits grow. Lessons aren’t always easy, or “fair”, because we’re not here to learn the same things.
Anyway, that’s a little broader than what you’re specifically writing about in your post. But I think that in finances, as in so many other areas of our lives, people compare themselves to others. Maybe that’s an unfortunate consequence of being social beings.
Thanks Nathalie! I agree with your broader perspective. Life is all about learning and progressing. Sometimes it’s situations that just happen and sometimes it’s situations that we get ourselves into, but all our experiences can be for our good.
Someone once commented to me that they were surprised we didn’t declare bankruptcy due to our debt levels. The thought hardly crossed my mind. So I understand your point about the mentality of entitlement as opposed to responsibility.
Good for you for taking responsibility!
I’m less sure about the generational thing — older generations, after all, were able to go to state schools with virtually no costs, and it *does* seem unfair that people in their 20s are being asked to pay so much more for the same education.
However! That said, any of us individuals are in our own situations, and it’s not that helpful to feel sorry for ourselves — it’s much more helpful to take action. Ideally, I guess, we’d all both do whatever we could to repay our individual loans (and meet other financial goals) while also working towards societal reforms that might make things easier on everyone.
It is hard to compare generations and make generalizations. We stand to make much more than our grandparents (though I think tuition has gone up faster than wages), but we also have a lot more opportunities to learn (thank you internet).
I agree that taking action is the only way to accomplish anything!
I heard a radio discussion about these programs this week. I think a lot of people don’t realize that the amount forgiven through these programs is considered income and is therefore subject to federal income tax.
The people I heard on the radio show had no idea and were hit with penalties etc. Definitely something to keep in mind for anyone considering this option.
Yes, that is true for both IBR and PAYE. It’s definitely a good idea to plan for that! It’s really a small price to pay considering the huge financial relief you’re receiving though. Thanks Jen!
This may be true for certain types of loan forgiveness, but not for all. From FinAid. org:”Public service loan forgiveness, teacher loan forgiveness, law school loan repayment assistance programs and the National Health Service Corps Loan Repayment Program are not taxable. Loan discharges for closed schools, false certification, unpaid refunds, and death and disability are considered taxable income. The forgiveness of the remaining balance under income-contingent repayment and income-based repayment after 25 years in repayment is considered taxable income. “
That’s right. There are some programs where the forgiven portion of the loan is not taxed. A lot of those programs also forgive loans sooner (like after 10 years of payments).
Love this post! I just finished my masters degree and am starting to pay off the hefty price tag that came with it. Many of my classmates are complaining that it’s “not fair” we get charged so much interest on student loans and while I agree that the interest rates are high I also know that they are exactly what I agreed to when I asked for the money. Here’s hoping I can stay on track with my re-payments to keep that interest as low as possible!
Congrats on finishing your degree and starting to work on paying it off! It’s good to get started right away. The longer people wait, the more overwhelming that interest becomes.
Great post – My favorite on this site so far! I felt compelled to respond because I agree completely with what you wrote. My husband and I recently finished paying off both of our student loans by doing exactly what you and your family are doing – living on as little of our income as possible and paying way more than the minimum payments each month to dig ourselves out of debt as fast as we could. What started as six figures went down to five and then finally 0. It was so satisfying to click submit on that final payment! Knowing that we worked hard to repay what we borrowed was very empowering! Keep up the hard work – you can do it!
Wow Stephanie, Thanks! Congrats on getting your student loans paid off, an especially great accomplishment since you were in the six figures under club too!! I’m glad the classic method of living on less and paying as much as you can worked well for you two. Thanks for the encouragement!
I totally agree. I think there is a lot of entitlement with student loans. When my husband and I married in 1998 we had 60k in debt. We understood that we had signed on the dotted line and it was our responsibility to pay it back. We made our payments every month and when we had extra we put it towards the debt. It only took a few years to pay back. We certainly didn’t whine and cry about it. It was something that had to be dealt with. If college students and recent graduates want to be treated as adults they need to act like ones.
Btw, I think you and your husband do a great job with your debt. When his income increases, you will plow through it.
Thank you Sue! That’s great that you took care of your debt early on by doing it the good old fashioned way (you know, making the payments and putting down extra when you can).
I am so thankful that we have not had to have student loans BUT we are hoping our children will not have to as well. We should be saving for their college years now … ACK! As far as taking control of debt … one step at a time … it always works out some how, some way and it feels good to know we can do this!
My husband and I both got our undergrad degrees by working part-time or full-time while in school. Our parent’s didn’t pay for school. With scholarships, going to a reasonably-priced school, and working both during the school year and (a lot) during the summer, it is possible to have your kids go to college without your help. But it’s always nice to have money saved up. 🙂
I try to make sure I stay away from temptation so that I don’t get into arguements with myself about what I’m entitled to. I do now feel as though I’m now in control with my money and what I’m doing with it since I started paying off debt.
“…get into arguments with myself”– love this! I’m glad you’re in control now!
I’m a single mom & grandmom. Paying off my debt to buy a home (hopefully) next year. Paying off my debt only feels “empowering” at the end of each month when I able to sit and look a what I have paid off completely (if anything) and what I may have to go. During the month when I get paid then the money goes right out to the bills and debt it hurts honestly. I do accept the fact I created the situation & I am the only one that can fix it.
I’m so happy I found your blog. I look foward to reading the back post and going on our debt free jouney together.
Congrats on being so close Krystal! It is painful to watch the money leave your hands, but it is nice to look back and see your progress. I just try not to let myself dwell on all the other things I could do with that money otherwise it can be disheartening.
Well said. The entitlement and victim mentality and attitude is sooooo prevalent these days. Thanks for taking responsibility and pointing it out in such an excellent post.
Thanks J.C. It is prevalent and can sneak in easily if we let it!
When my husband and I first started making payments on our student loans, we had no plan and no real strategy to paying these student loans back. I honestly didn’t see the light at the end of the tunnel. After sometime we were able to develop a strategy and really came together as a team. We were forced to budget, plan carefully manage our money. We do feel in a way “empowered” by this situation. We were able to carefully manage and get through this. It hasn’t been easy by any means but it has given me confidence that there will be an end to the debt in the next few years.
It’s definitely not easy, but it will be worth it! Have a plan or strategy really helps you be able to see the light at the end of the tunnel.
You are bold taking on entitlement in this post, especially as it pertains to student loans. Such a hot topic!
However, if anyone is qualified to touch on this topic, you are. I love it! I appreciate you being candid on the tough topics. This is the reason I read your blog.
Thanks Pamela. I really think that when people have an entitled attitude they are doing themselves a huge disservice. You will make more progress toward your goals and be a lot happier when you take responsibility.