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BuckGup

Paying For College

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17 hours ago, BuckGup said:

How do people manage stuff like accidents or buying exspensive cars and PCs?

It's called Credit Cards, Canada has a huge credit issue right now where something like 70-90% of all credit is technically bad credit (they can't repay it quickly).

 

I personally wouldn't worry about the long run but invest the time in making sure that career has a viable future (likely does) with grounds for expansion, plus the school. The last thing you want is what happened to a lot of people in the course I eventually left in, which was it was so broad it was nothing more than a cash cow for the school leaving most students in debt w/o a career in a area of field widely needed.

 

for everything else paying back a 60,000 on a 55,000 a year job even at 50% deductions stated above shouldn't take more than 10 years. If it does and not caused by the economy then you're doing something wrong. People think "I make $XX,000 a year so I can afford this" but in reality they should be living like a student just making due still till that loan is gone, not buying a $500,000 house with a $60,000 BMW along with a yearly cruise... Those people even tho they might be making nice money they are blowing every penny of it. I wouldn't actually compare yourself to them in any way, the fact you're posting it here shows you're nothing like them.

 

If you want my financial advice, here it is:

 

  1. buy books used if possible
  2. if you can live at home (cheaper), if not living further away is usually cheaper
  3. always try to get a summer job
  4. after completing school get into work immediately (even if not in your field) to start burning down that debt.
  5. once you have a deposit on the home don't immediately buy unless you're willing to commit for 10+ years (many people buy homes and sell in 5 years, which worked recently in canada for the housing boom, but usually you lose money doing so). Pay that thing down asap (no vacations night trips weekend drives are fine), if possible have a mortgage that permits extra payments at no charge (it saves interest immediately).
  6. Save enough money for 3-5 years before you invest in retirement, AND DONT TOUCH IT, unless needed, also replenish it if used, keep them in 3-6 month bonds etc, usually better interest than sitting in the bank doing nothing.
  7. Don't dump all retirement fund into retirement plans, simply because if you need to access those funds you will likely get hit hard on fees accessing them, instead invest in secure investments that are 1/2/3 years, more work but if something bad happens it's easier to get.
  8. buy used cars or take public transit to save more money. No offense to new car buyers here, but yea all are technically idiots, losing upwards to 30% the second you claim ownership...
Just now, IP man said:

You think to much haha, just live life and take the problems on the fly mate.

nope, worst thing to do... Unless you're willing to take the easy way out of life when it backfires...

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2 minutes ago, Egg-Roll said:

nope, worst thing to do... Unless you're willing to take the easy way out of life when it backfires...

What easy way? Cant go around being scared and worry about everything, just my 2cents

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Just now, IP man said:

What easy way? Cant go around being scared and worry about everything, just my 2cents

easy way out = suicide.

going yolo and spending every penny when you have debt is literally the dumbest thing anyone can do. Unless you have millions in the bank for the future I wouldn't tempt fate in any way.

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11 minutes ago, Egg-Roll said:

-snip-

Just to expand on the investment, if you get a good employer that will match your 401K investments, max it out at least to what they will invest which is usually between 4% and 6% matched so if you put in 6% of your paycheck then you'll get 12% in reality. Just check and make sure it's vested before you leave, otherwise that money stays with them.

 

Pick a mixed fund if you do have a choice for 401K or Roth IRA for a more well balanced and less volatile result.

 

Never invest in one basket, ex: NEVER invest more than 10% (20% if you really think they'll do good) in the companies stock.

 

See if the company you plan to apply to has a stock purchase programs where you buy stock at a discount a couple times a year and can then turn around and sell at full price, it's a nice ROI there too :)

 

If you have the option for a 401K and ABSOLUTELY HAVE TO touch your retirement, see about a 401K loan, you pay it back with interest but that interest is to yourself to try and make up for the lost growth from taking money out.


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3 minutes ago, RorzNZ said:

I'd probably not go to a university in the US if it cost 50k USD tbh. Even international fees here are cheaper than that :(

Maybe you want to be closer to home, but its an option to go elsewhere.

Agreed, plus, people seem to have this notion that you have to go to a 4-year college.

Look at community college with the option to transfer after getting an associates degree, it's cheaper if you change your mind, gets you something that can get you in a job faster, and can let you see if your career is really what you want to do in life since they usually have a lot of teachers with real-life experience. Not to say 4-year colleges don't have teachers who've worked in the field it's just more common, at least from what I've seen, to have teachers who work in their field full time and teach as well or alternate.


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2 minutes ago, Lurick said:

Agreed, plus, people seem to have this notion that you have to go to a 4-year college.

Look at community college with the option to transfer after getting an associates degree

Not to mention just the general idea that you need to go to a 'Good College'.  For most fields you just have to go to 'A real college'.  So long as you don't get your degree/certificate/diploma from a former Pizza Hut location that has a sign reading 'We Print Diplomas For $1000 Each' out front, you're probably good.

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33 minutes ago, IP man said:

You think to much haha, just live life and take the problems on the fly mate.

I'm just going to give you the benefit of the doubt and pretend you are being highly sarcastic.


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18 hours ago, BuckGup said:

I was just doing some calculations for college and life stuff and how do people do this. If I went to school I would pay $60,000 and say I start at $55,000/year it would take 13 years to pay it off at $400. Then add in rent, food, gas, taxes, other expenses you are only making $18,000 a year. Put half in retirement and some in for investments how do people live? I mean I take buying a $500 for granted now. If you need 1mil to retire it would take 55.5 years saving all $18,000. This is all assuming you don't get a pay raise and $55,000 is a little low for a computer science degree with specialization in cyber security and AI but it was just the low end to see. How do people manage stuff like accidents or buying exspensive cars and PCs?

The same way I manage it making less than $10,000 a year. 

The first thing to note is that most people you see are living paycheck to paycheck, or worse.

Those who aren't actually are, except for we don't call it that because they are putting their excess money into investment accounts (which means they do have excess, they just pretend that they don't).

Another thing to consider is that many people didn't pay for 100% of school with loans. Summer jobs, rich parents, scholarships, and contest money account for more than you think they do. Even those who do pay for it all with loans still get PEL grant, which can give you almost $10,000 a year in "free money".


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It is possible to go to college debt free; I did.  It wasn't easy, but it happened.  Here's a quick summary:

 

1. At the youngest legal age get a job in the trades while still in high school.  Don't go for fast food or other minimum wage positions.  I was making $25/hr an hour in the summer and on every school break as a carpenter (it was the early 1990s).

2. Take advantage of early college class programs in your high school (like Washington state's running start program) to transition out of high school and into college as soon as possible and to get some college classes for free.

3. Go to a community college while working as many hours as your schedule allows.  This does require a job that has flexible hours. Stay until you get your 2 year degree; this will probably take 3 or 4 years (took me 4), but the extra time will be more time spent making money.

4. Go to state or regional university where you can get a resident discount to get your 4 year degree (for me it was aerospace engineering).  By the time I did this I had enough money to pay for it out of pocket.

5. Get a job while not feeling the pressure of debt and utilize your blue-collar skill to bring in some money while looking for the right job.

 

Not everybody can do this, obviously (the building boom in the pacific northwest in the 1990's was a huge help to me), but it is possible.

 

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It's threads like this that make me very happy that my employer provides me with a defined benefits pension.

 

Student loans are a bitch. I'm still paying mine off. But slowly but surely, it's getting there.


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3 hours ago, IP man said:

You think to much haha, just live life and take the problems on the fly mate.

 

2 hours ago, Gale said:

I'm just going to give you the benefit of the doubt and pretend you are being highly sarcastic.

What's wrong with taking each day as it comes?

 

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3 hours ago, IP man said:

You think to much haha, just live life and take the problems on the fly mate.

like the (in)famouse quote: "Let's burn that bridge when we get there"


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35 minutes ago, WhatTheHell said:

 

What's wrong with taking each day as it comes?

 

I technically do it, as long as it's not involving possible financial consequences it is not. However that said I don't go running out blowing funds left right and center, I usually track/trace my purchases and predict future ones, so while my life might be a "yolo" style to those who see me, it's actually quite organized.

 

54 minutes ago, dalekphalm said:

Student loans are a bitch. I'm still paying mine off. But slowly but surely, it's getting there.

If your interest rates are higher than taking out a personal loan with your bank maybe switch if the payments are equal. I'll be doing/trying this with a debt soon as a few dollars saved is still a few dollars, plus by putting in the same amount every month pays it off faster :)

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7 minutes ago, Egg-Roll said:

I technically do it, as long as it's not involving possible financial consequences it is not. However that said I don't go running out blowing funds left right and center, I usually track/trace my purchases and predict future ones, so while my life might be a "yolo" style to those who see me, it's actually quite organized.

 

If your interest rates are higher than taking out a personal loan with your bank maybe switch if the payments are equal. I'll be doing/trying this with a debt soon as a few dollars saved is still a few dollars, plus by putting in the same amount every month pays it off faster :)

Oh my interest rates are much lower than what a bank would offer me. My credit - while better - is still "not great". After College (graduating right in the middle of the biggest financial crash since the great depression), finding work was difficult for a long time - that lead to further debt, credit card debt, and all kinds of bad - my credit score tanked. It's much better now, but still not where I want it to be.

 

My student loan interest rates are respectable, and low enough not to concern me trying to shop around.


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Well, for starters if you really wanted to pay it off, you wouldn't be paying an amount as low as $400/month.

  • Others have already touched on a lot of the options such as bursaries, scholarships, grants, incentives, etc. You should apply to as many of these as you can, even if you don't think you can get them.
  • Get a part time job. See if you can get one at a company that will pay for some or all of your schooling if it's a related field, or a company that offers scholarships or education assistance of it's own.
  • Are you figuring $18,000 after taxes? That number seems off. Unless you meant that's after rent and everything, in which case it's not bad at all.
  • Half into retirement seems like an awfully high amount.

As for the other part of your question, most people are in debt. Plain and simple. They don't buy expensive cars and such until they've already paid off their student loans.

 

A million dollars now won't be what a million dollars is in 50 or 60 years. Something to keep in mind.

 

5 hours ago, AshleyAshes said:

^^^^^^^^^^^^^^^^^^^^^^

THIS IS WHY WE SHOULD TEACH HOW COMPOUND INTEREST WORKS IN ALL HIGH SCHOOLS

There's a lot of life lessons that should be taught in high school that aren't.

I think the bigger mistake is letting people take whatever they want out of school. It creates a ton of people qualified for jobs that aren't there.

5 hours ago, Tiberiusisgame said:

-snip-

Also don't expect to buy a new house before you're 30 unless you pair up with an equal earner and you have some help with the down payment. The world isn't how it was in the 60's.

It's really not out of the realm of possibility. There's loads of places you can move to with affordable housing, or if you get a decent enough job, it's easily done after a few years of saving. My buddy bought his place just outside Canada's most expensive city when he was 25. Several of my other friends bought their houses before they were 30.

5 hours ago, Mr.Meerkat said:

Holy moly, its only 1.5% interest here plus we pay £0/year for our first degree (regardless of whether its a 4-year bachelor or a 5-year master) so...rip you guys? :D 

Haha, yeah but you guys pay a lot more in taxes ;) I think the smaller European countries do education a lot better though.

Especially the ones that only allow you to take University courses if there's actually demand in the field.

3 hours ago, Egg-Roll said:

buy used cars or take public transit to save more money. No offense to new car buyers here, but yea all are technically idiots, losing upwards to 30% the second you claim ownership...

Yes! I've never understood people that buy new cars, unless maybe they're a year or two old and have been sitting on the lot. Wait a year or two, and you can save tons of cash; much more than any warranty or dealer incentives could offer.

3 hours ago, RorzNZ said:

I'd probably not go to a university in the US if it cost 50k USD tbh. Even international fees here are cheaper than that :(

Maybe you want to be closer to home, but its an option to go elsewhere.

Truth. One of my ex's went to UBC for 4 years, and it was tens of thousands less than the education she was looking at getting in the US.


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9 minutes ago, Egg-Roll said:

I usually track/trace my purchases and predict future ones

Very easy nowadays with like for like bank apps, I always plan out future spends in life and keep a safety net of several thousand just incase I ever need it.

(very easy to do, very few that can actually do it)

 

Then I just wing the rest. 

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1 minute ago, WhatTheHell said:

Very easy nowadays with like for like bank apps, I always plan out future spends in life and keep a safety net of several thousand just incase I ever need it.

(very easy to do, very few that can actually do it)

 

Then I just wing the rest. 

My bank actually doesn't supply much more than transaction history, So I made a spreadsheet which was too harmful to look at so I made a PHP/MySQL one instead :D I've yet to make a pie chart, easy to read flow chart etc... but I can easily implement that if i really need it.

 

7 minutes ago, dizmo said:

Yes! I've never understood people that buy new cars, unless maybe they're a year or two old and have been sitting on the lot. Wait a year or two, and you can save tons of cash; much more than any warranty or dealer incentives could offer.

Sometimes the year end sales are good, both of my parents bought cars at years end, one used from a rental (40Km I think) 50% off bought at a dealer that it was bought from by the renal company, the other was a last production year made for a truck, they got a $40K version for about $25K.

 

13 minutes ago, dizmo said:

It's really not out of the realm of possibility. There's loads of places you can move to with affordable housing, or if you get a decent enough job, it's easily done after a few years of saving. My buddy bought his place just outside Canada's most expensive city when he was 25. Several of my other friends bought their houses before they were 30.

It's not so much about age, but the ability to save, if one can't save, one can't own. Basically a legal to work teen if started saving could put a nice deposit on something by the time they are 21 even at a coffee shop.

$3/hr to save works 3 hours 2 times a week and 8 on the weekend for one day, $42 a week plus summer/break (9 weeks @ 5 days/8hr) pay assuming. after 5 years (assuming 16), would give about $15,000. Assuming a 30% that won't give much(canadians anyways, it's still possible tho), but it shows the power of saving.

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5 minutes ago, Egg-Roll said:

It's not so much about age, but the ability to save, if one can't save, one can't own. Basically a legal to work teen if started saving could put a nice deposit on something by the time they are 21 even at a coffee shop.

$3/hr to save works 3 hours 2 times a week and 8 on the weekend for one day, $42 a week plus summer/break (9 weeks @ 5 days/8hr) pay assuming. after 5 years (assuming 16), would give about $15,000. Assuming a 30% that won't give much(canadians anyways, it's still possible tho), but it shows the power of saving.

Except the person making $3/hr wouldn't qualify for a mortgage :P

You can also get away with a much lower down payment. Depending on your market conditions, buying in early and paying more in interest might make more sense then waiting and putting more down to pay less in interest.


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4 minutes ago, dizmo said:

Except the person making $3/hr wouldn't qualify for a mortgage :P

You can also get away with a much lower down payment. Depending on your market conditions, buying in early and paying more in interest might make more sense then waiting and putting more down to pay less in interest.

I meant to say $3/hr being put aside into savings, the student could be making any amount higher, for Ont it's 14, or after tax about $9.10 or $6.10/hr of play cash.

 

Also I quickly looked in the states market... Wow, if I got a job near the boarder I could live in the states for as low as $25,000 USD... $50,000 would give a decent house $100 would give a closer to home one :P $150 in the middle of nowhere would give what I live in but with no annoying neighbours to complain about you xD

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5 hours ago, Lurick said:

a lot of people live on debt.

most people do!

 

 

Type of debt

Average for households with this type of debt

Total U.S. debt of this type

Households with this type of debt

% of American households with this type of debt (approximate)

Overall average household debt

Credit cards

$15,762

$733 billion

46.5 million

35%

$5,517

Mortgages

$168,614

$8.25 trillion

48.9 million

36%

$60,700

Auto loans

$27,141

$1.06 trillion

39.1 million

29%

$7,871

Student loans

$48,172

$1.23 trillion

25.5 million

19%

$9,153

All debt

$130,922

$12.12 trillion

92.6 million

69%

$90,336

 

 

 

 

 

 

 

 

 

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7 minutes ago, Egg-Roll said:

I meant to say $3/hr being put aside into savings, the student could be making any amount higher, for Ont it's 14, or after tax about $9.10 or $6.10/hr of play cash.

 

Also I quickly looked in the states market... Wow, if I got a job near the boarder I could live in the states for as low as $25,000 USD... $50,000 would give a decent house $100 would give a closer to home one :P $150 in the middle of nowhere would give what I live in but with no annoying neighbours to complain about you xD

Ahhh gotcha. You'd need around $20/hr to get a decent mortgage acceptance though.

Haha, I wouldn't want to go back and forth across the border every day. Plus you have to declare foreign property on your tax return ;) You also have to put way more down, and it's harder to get a mortgage.


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4 minutes ago, dizmo said:

You'd need around $20/hr

thats still pretty low, a mortgage is $550 per 100K, need 5% or more down in cash.

I am seriously thinking retirement in another country is wise!

A country where you can live like a king for $500/month!!!!!!!!! which is $6K/yr with a gic rate of 3.5% thats only 200K to save!

 

https://blog.mint.com/goals/9-places-where-you-can-retire-and-live-like-a-king/

Quote

Rental properties in Thailand can readily be found for between 3,000 to 10,000 Baht per month, which equals about $90.00 to $300.00 USD.

 

 

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