An Investment in Your Future: Paying Off Your Undergraduate Education

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Paying It Off

It is never too early to consider how you plan to pay off your debts after graduation. Outstanding loans can easily begin to influence career decisions. Nobody likes the feeling of lugging around a huge debt burden, and the temptation to pay it off as soon as possible may cause you to change or adjust your career goals.

"I knew that college was extremely important," Erik recalls. "I also knew that my parents didn't have the money to send me to an expensive four-year private college. I decided that, whatever the cost, and however long I was destined to be in debt to repay the cost of attending a top institution, that it was a sound investment in my future and that I was willing to undertake that daunting commitment."

"I had no strategy whatsoever, and that came back to bite me," Amanda added. "I thought my parents would be able to pay for the whole four years, but that didn't work out. I took the fall semester of my sophomore year off and got financial aid the rest of my time in college - mostly loans and work-study, very little in the way of grants. I did not look very hard for additional funds, which was a mistake, but I got a job as a Resident Adviser my senior year, which was a great job with very good benefits."

Once you are in the middle of the experience, you may find yourself drifting away from your original career goals and being drawn toward more high paying jobs. These feelings may be related to a genuine change in career objectives, but many times, the change is actually motivated by money and a desire to pay off your debt burden as fast as possible in order to "get on with life."

Although debt is uncomfortable, it is preferable to selling yourself out and settling for a life other than the one you designed for yourself. Determine whether a temporary detour for a several-year tour of duty at a high-paying job in a consulting firm or an investment bank in the name of debt relief will still allow you to find your way back to your chosen career path. If you conclude that it will, set some clear financial goals, force yourself to save money and reduce your debt, and plan your exit strategy and route back to your goal. Many, many graduates find themselves seduced by high dollar offers, get hooked on the lifestyle associated with these high-stress, high-paying jobs, and never actually make it back to the original plan they had for their lives. These are the people who then end up on the therapist's couch suffering from a midlife crisis.

Sure, some people find satisfaction and happiness in this change of plans. Many others, however, simply become victims of inertia and don't recognize the abandonment of their professional goals and dreams until everything comes apart in midlife. Don't let a temporary debt burden frighten you into making bad decisions that will have a long-term negative impact on your life.

"I owed a lot of money when I graduated," Erik said. "And I didn't find a real job for more than a year after I graduated. But given how most student loans are structured with low rates and deferment options, I was mentally prepared that I was going to be spending the next four to eight years paying off these loans, and that is ultimately what happened. My debts did not have any impact on my life or what career I was choosing given the prospect of spreading out payments over a very long period of time."