Let's Talk About Debt
What a privilege to be trusted with money I'll pay back later
This week, my older pseudo-sister found out she wasn’t going to get food stamps and that she was furloughed from her government job. She has five kids, and her husband is on disability.
“Fuck it,” she tells me over the phone. “If I’m going down, I’m going down in style.” What she can see in the immediate future is impending financial struggle. What she can’t see is any assurance of hope. Estranged from her parents, who don’t agree with her marriage, she has no real means of familial support.
So she bought the things her family needs for the winter before she can’t anymore. “I bought jackets, boots, and winter clothes. Sissy, I found Uggs on sale! What size are you? I bought a bunch of bras for like twelve bucks.”
My sister is the best couponer I’ve ever known. She can spot a deal a mile away. She has all the best apps downloaded and knows how to thrift online and in person. She’s been doing this for years. For Christmas and birthdays, she gives gift bags or boxes, filled with food, makeup, razors, toothbrush heads, socks, outlet designer boots, and sometimes random household cleaning supplies. Whenever we’d visit, when I was younger, we’d say we were going to go shopping at her house because we never left empty-handed.
She once had a whole wall of diapers bought at a discount. Then she had three little ones and used the diapers she liked and sold off or gifted the ones she didn’t.
She is, in my eyes, a financial genius in many ways.
“Let my credit score go to shit,” she says, laughing into my ear. “I don’t care! I sent Sammy home with boxes of food and even alcohol for Mama.”
Her abandon and generosity, tinged with understandable anger, come flowing into my ear as I stand in Target, careful not to put anything into my basket that’s above $5.
“Sam, do you ever regret starting your own business?” I ask.
Sam has always been keener on risk than I am. Not financially. Just in general—in life. Sometimes that hasn’t worked out so well for him. But now he drives across the country day and night, making bank (as we say), and supporting his girl and two children.
“Nope!” he assures me. “And every single day.”
We laugh together at this seemingly contradictory reality. I can count on him to be pretty real most of the time. Sometimes when he’s in a different headspace, he’ll be more grandiose, but most of the time, he’s down to earth.
“Nah, I don’t regret it,” he assures me. “It’s just a lot of work. I’m tired. I want to go home. But no, I don’t regret it.”
“What about the debt part?” I ask. I have an agenda, of course, and am looking for reassurance. “Were you scared to borrow as much money as you did for your truck?”
Sam and I talk often about the constant struggle to stay out of where we came from and to do better by our own kids. But the struggle is real, and we’ve chosen different challenges. He’s all in, 24/7, working his ass off. I’m about to quit my job (again) to finish a degree (again). His debt was to purchase a semi-truck and go to trucking school. My debt is educational loans to the government.
“You’ve gotta take risks, Heidi,” my brother says, probably for the fortieth time since starting his business. “Low risk, low reward; high risk, high reward.”
Some people, who don’t pay attention, IMHO, would highly suggest that one save up to purchase a semi-truck, to save up to go to college and graduate school, to save up to purchase a home, yada yada. Sam and I know better. But for a lot of folks, the very idea of debt makes their brow prickle with sweat.
One of my best friends, a woman so smart she can talk circles around anyone dumb enough to perceive her as quiet just because she’s nice, is about to graduate from her doctoral program. Our doctoral program. We met in graduate school several years ago, both of us taking an especially long time to get through it. Both of us had severe and sudden life circumstances that kept us from focusing primarily on school. Both of us are taking out enough student loans to dwarf a mortgage.
“Where’s our debt at?” she asks me one candid afternoon.
“I’m at about 350. What’s yours?”
She giggles. “Almost double. But it’s okay. I’m about to be out of here.”
She isn’t planning to go into academia like I’ve been planning. No, her sights are set on something much bigger. She’s going to DC. This country needs her expertise, and by God, they'd better pay her for it.
“How do you do it?” I recently asked when contemplating quitting my job and living off loans to finish my PhD and my book. “How do you get by on the loans? They’re substantial and still not enough to cover my expenses. I’m scared, to be honest.”
She drew on her vape pen and turned her head to exhale away from my face as we walked across the train tracks and into the village just north of our housing community. “Well, I sold my car. You remember my Jeep?”
I didn’t.
“Yeah, I sold it. And—” she stops talking to take another puff. “You can ask for more if you need it and have receipts for research expenses and stuff.”
She lives alone, no spouse, no kids. I mean, so do I. But I’m still paying for my car, which I will not sell, and for my kids’ cell phones and periodic presents, and such. I consider my options briefly before I ask her what expenses she was able to get an increase for.
Robert Kiyosaki, the author of Rich Dad, Poor Dad, a book with a lot of short sentences made up of short words and catchy acronyms, urges people to use OPM.
What’s OPM?
Other People’s Money.
While Kiyosaki focuses primarily on large investments, like real estate, his message is clear: Don’t be afraid of debt. Or the right debt, anyway.
In his opening vignette, Kiyosaki describes a rich dad who has money and passive income as an entrepreneur, but no flashy cars or anything extravagant. His poor dad, by comparison, always buys the latest gadgets, but always seems strapped for cash. His poor dad is educated and likes to play it safe with his money, avoiding risk.
At times, I wonder if Sam is the Rich Dad and I’m the Poor Dad. It’s not that simple, of course. But Sam’s entrepreneurial spirit is making him big bucks after taking on some financial risk. I’m still working on the getting educated part. But I’m watching my brother like a hawk.
“I need to generate a business plan,” I tell him. “For my book, I mean. Well, I think mostly a marketing plan. But anyway, I might need your help.”
“You on TikTok?” he asks me.
“Technically,” I admit. “I don’t have any content on there, though.”
“Make a video of you talking about your book. Send it to me and your nephew. We’ve both got thousands of followers. We’ll help you get hyped.”
Yay, more of my face on video. Love that.
“Is that a marketing plan?” I ask.
“That is marketing, Heidi!”
“Can’t you teach just one class?” A guy sitting next to me at a local bar asks, his face screwed up in some possible combination of pity and disgust. Can’t quite tell.
“I mean, yeah, if I want to,” I admit. “But that defeats the point. The point is to free up my time to finish my degree.”
“But you came from poverty. Why are you willingly going back there?”
I laugh. Not because he’s being funny. Not because he’s right. But because going back is nowhere near what I’m doing.
Poverty isn’t having debt. Poverty is not even being allowed to have debt. The ability to step away from work to pursue a lifelong goal because I’m allowed to have debt is a privilege few who have never been poor really appreciate.
When I was a recruiter for a very expensive private graduate school (ahem), I inevitably encountered the funding question. Students want their graduate education to be funded. Ugh, yeah, don’t we all, Becky?
“Think of it like this,” I’d tell them. “If you purchase a house and then get laid off, or the economy crashes and you’re upside down in your mortgage, you could lose your home, right? Your house could be foreclosed on. This will never happen with your education. Your education can never be taken from you. Once that degree is earned, that’s yours for life. And that degree will, statistically speaking, make you more money than if you didn’t have it.”
After my beautiful pep talk, young adults from wealthy backgrounds would turn to me, scrunch up their noses, and say, “Yeah, but I want to avoid loans as much as possible. I don’t want to start my career off in debt.”
So we’d walk through their options, almost none of which involved the school giving them more money, though they’d try. Sometimes they’d be thrown a couple of extra thousand in fellowship funds that barely made a dent in their tuition.
What I didn’t tell them, ever, was how lucky they should feel if loans were even an option.
Because, you see, to afford this school, this prestigious institution of graduate-only education, subsidized and unsubsidized student loans just weren’t going to cut it. To afford the tuition, you’d have to take out a Grad PLUS loan, which is a hard hit to your credit. And if your credit isn’t good enough, you can’t get it.
In 2016, when I was accepted to the Master’s program, I wasn’t eligible for the Grad Plus loan. I had accounts that had been in collection from when my husband had lost work, and we’d been forced to live off credit cards to eat. And when I say eat, I mean lima beans for dinner. Concoctions made of the last four ingredients in the kitchen that we called “stuff.” My husband had been selling plasma and recycling cans to buy ramen noodles and boxes of mac n’ cheese at the 99 Cents store.
Even though we had caught up on payments, had accounts on payment plans, my credit score was too low, and the existence of any accounts in collections at all blocked me from being able to take out loans. So I went on a monthly payment plan for the tuition, as I had in undergrad. The monthly payment was more than we had paid in rent before we’d moved to California.
It’s about here that I believe people might chime in with some remark about choices.
The guy at the bar continues to tell me about his career journey. “And I wasn’t going to go on unemployment,” he says.
“Why not?” I ask. “If you qualified, it surely could have helped while you were getting established here.”
“Nah, I don’t want to suck on that teat.”
Now his reaction to my choice to live off loans for a couple of years makes sense.
My father, a few years ago, had been laid off and was hurting badly for money while looking for a job and facing age discrimination and a bloat of entry-level positions that required a degree he never got.
He asked to borrow some money from me. I don’t think he would have asked if it wasn’t for the fact that he knew my boyfriend at the time had taken me to Paris and was, himself, financially well off. But I wasn’t going to ask my boyfriend to give my dad money.
“Have you applied for food stamps, Dad? I’m sure you’d qualify.” I qualified. I was on food stamps. My boyfriend had his expenses, and I had mine. We were living together, but I paid half the rent and had two children living with me.
“No, no, I don’t want to do that,” my father said, clearly dismissing the option from some values-based belief about government welfare.
Ironic. We were on food stamps my entire childhood, when he did have a job.
I sent him $500 when I got my student loans. Funny, isn’t it? He was taking money from the government through me, anyway.
I love how you describe the abandon and generosity. A couplet that only bears confusion have you not struggled financially. Amazing writing, Heidi!