I had meant to write about this the other night, but wound up ranting about something else instead. As I was leaving the classroom on Thursday evening, some students and I were talking about student loans, and I said that I wanted mine paid off, and that I never wanted any more debt ever again, not even a mortgage.
One of the students, who is not my student by the way, but one who had stopped by with friends who were my former students, said to me something to the effect, "Well, having debt is good because it makes your credit better, so that then the bank will give you a loan that you can maybe pay back eventually."
That caused me to blink a couple of times, and I couldn't address what they had said because we were half way out the door, but I wanted to say, 'do you hear what just came out of your mouth?' People, people, people. You've been sold a bill of goods. Quit buying crap you can't afford with money you don't have so that you wind up giving all of your disposable income to the bank in the form of interest payments! I've said it before, but I'll say it again. Add up what you're paying in interest on your debt, and put that into an IRA calculator with a 8% return over forty years (the market has averaged 12%, but we can be conservative on the matter). Don't try to cry too much. It will just make your allergies worse.
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