We were warned about this when we were children, it’s in Aesop’s Fables. Fortunately due to our crippling debt we’ll never have families.  There is always the chance of a contraception mishap but now that I’m on the other side of 30 I don’t really see that happening. But I digress.  The Tortoise and the Hare.  The way I read this story now is that we are Hares, the Tortoises are our idiot peers who coasted through high school and their state University of choice, only to end up managing us after we went into debt earning useless degrees that don’t land us jobs in this economy. I mean when you think about it, these ignoramuses who can drink a keg and not fall over are the epitome of “slow and steady.”

But seriously, let’s look at the Economics of this. In addition to reading children’s picture books I also have read the Wall Street Journal as of late. The article pointed out that the number 1 indicator of future success is the state of the economy your first 2-3 years of working. Kids who enter the job market in a recession NEVER recover to the point of other classes no matter how good they are or how fast they run.

So while you were borrowing 30k+ a year to go to grad school your idiot neighbor with a BA in political intrigue (because it makes him sound like a spy) was already earning 42k a year, which was 60k with no debt by the time the economy slid into the toilet.  Meanwhile you graduated to nothing with six figure debt.  3-5 years later, you consider yourself lucky (at first) to be getting 40k a year which isn’t even the STARTING salary of your idiot friend with none of your credentials, and by now he’s making six figures, thanks to the 15% raises he kept getting even after the economy sunk because by then he had “experience.”

For your own sanity’s sake my first recommendation is that you disassociate as much as you can socially from the idiot drawing six figures.  I know its tough if the individual REALLY IS your boss, but to the extent possible try and avoid looking at their smug, ugly, condescending face. Oh and drink. Otherwise you’ll find yourself planning an office shooting.

For those of you who are not completely broken, there is…well, hope is a strong word.  You have a chance, let’s put it at that. Just remember a couple of things 1) this idiot is still an idiot 2) stop playing their game 3) the secret to success is non-wage based income.

First, your idiot friend is still an idiot.  And he lives in a completely different world than you.  There was no recession for this kid. He will still borrow heavily to buy the perfect house.  He has car payments. He won’t pick up a tab at a bar and he’ll charge you $20 to chip in for alcohol at his house, but all the expensive toys you just spent $20 and an evening you’ll never get back to look at…the gym equipment he never uses and the music equipment he hopefully never uses, that’s all him.  Let’s not forget the idiot spouse and did I mention this fool has kids on purpose? Things might just even out due to the miracle of Regular debt.

Second, you need to stop playing their game.  This means two basic things.  First, you are never going to have the trappings of a middle class life, such as home ownership, a car seven years old or less, children, or savings. Second, you are not going to get promoted at your current job or get a better job similar to the job you have (in terms of utilizing the same skillset). This means if you are working hard at your day job, you’re doing life wrong.  Your new motto needs to be “do what it takes not to get fired.”  Do this and watch other smart people like you get fired for embarrassing their idiot boss, emerging as a threat, or just constantly being in high risk situations.

Third, non-wage based income. Continue to live like a filthy student, decide once and for-all if you are going to aggressively pay down your debt or default, and then sink every penny you make into some kind of investment, whether its buying a fleet of food trucks, flipping houses, or selling junk you find on e-bay. It’s the only way really.

Our nap was called “grad school” and it proved fatal in this race.  For the rematch the now wealthy tortoise has paid his goons to do a number on our legs with a crowbar.  Now the only way to win is to take a traditionally thought of as risky path now that the tortoise is all risk-averse because he has something to lose.

But please for the love of god people, don’t go back to sleep.  Another degree is not the answer.

Hi folks! We here at Debtor’s Prison are pleased to introduce Rebecca Smith who has been kind enough to write a guest column.  We are impressed with Rebecca’s work and hope she will write for us again.

REBECCA SMITH

The latest chapter of a painful story that began years ago was the debt fight that continued in the capital of the nation and the ensuing credit downgrade by the Standard & Poor’s.  In the last decade, the banks, consumers and the homeowners became bloated with too much leverage or borrowed a huge amount of money and this resulted in a drastic shrinkage of credit throughout the entire economy, a particular phenomenon that is financially known as ‘deleveraging’. Apart from the big picture, the consumers too were worried about the ways in which they can seek debt relief so as to stay out of the debt cycle.

The present situation of the US is nothing new and the government has been grappling with such issues and has also been throwing billions to dollars to provide a quick cure from such problems. Even after continuous meetings and steps taken to assess and improve the current state of the US economy, there has been no positive result that is noticeable. Though the labor market reports were slightly positive in the month of July and August, 2011, yet there has been no such noticeable increase in the growth of jobs within the market that could alleviate the spurring unemployment level. Gut-wrenching market plunges, accompanied by multiple negative aspects of the economy show that the economy is losing steam. Despite all such nerve-wracking events within the US economy, very few expect the policymakers to reveal some new stimulus plans to rejuvenate the lost shine of the nation.

Fed Runs Out of Bullets – Is the Arsenal Empty?

While the Federal Reserve seems to be running short of bullets, the government is also low on ammunition. With the fractious debt fight demonstrated in Washington, the idea of “deleveraging” has even spread within the government. Both the local governments and the state governments are implementing draconian cutbacks to get back on track. The Congress, in the month of September, 2011 voted for a cutback of $2.5 trillion trim from the federal budget deficit and if this step is taken, this would perhaps be the most remarkable move towards austerity during a time when the economy is hardly growing.

The result of this is being shown in the unemployment rate that is stubbornly hovering around the 9% rate. As the debt ceiling debates followed by the raising of the debt ceiling sidelined the increased government spending, there’s very little cushion for the economy to fall back on, if there are chances of backsliding into yet another financial fiasco.

Credit Busts – Is There a Quick Cure or is This Going to Continue?

The most prominent result of “deleveraging” is the economic quagmire and this is also the reason for the extremely sluggish economic growth. According to a study done in the year 2010, it has been seen that it takes a nation minimum 6-8 years to emerge from the deleveraging process. Deleveraging has self-reinforcing effects! If the consumers have a high debt load and they stop purchasing things, the businesses will automatically stop hiring people and this will have a further impact on consumer spending. When the economy will face a dire financial situation, the US government will typically provide the economy with a shot in the form of spending projects or tax cuts. But the main issue here is that the government is running out of all the stimulus bullets!

The Federal Reserve has posed to be the final backstop for the economy. Though the central bank has tried to do everything possible within its means to spur economic growth, reducing the short term interest rates to nearly 0, purchasing billion worth Treasury Bonds and by putting the delinquent mortgages on the balance sheet, yet something more still needs to be done.

With the US economists and the analysts worrying about the future of the US economy, on a personal level, the consumers should also remain aware of their personal debt ceiling so that they don’t add on to the credit card debt level as this worsens the bigger picture in the long run. Get help from a professional

www.debtconsolidationcare.com

Rebecca is a financial blogger & associated with the online debt community debtconsolidationcare.com. If you want to know more about her & the community, you can get latest updates here on Twitter.com debtcc.

S’up losers? The following story is too deep for most of you.  In the original post I state there is a message for most of you but I lied.  You can read this and feel morally superior to me if you want OR you can read it with an OPEN MIND (unlike Erin and SG) and thoughtfully consider my position.

If I had to identify one thing that is the foundation of my mental and emotional health it is my concise moral code. I am not going to tell you what it is because that would detract from it’s utility. When you share a moral code wayward lost vulnerable people adopt it, then they debate it, then they try and codify it, etc.

But I will say this, one can think of “morals” as a predisposition – like the child of alcoholics are often predisposed to becoming alcoholics themselves. I am predisposed to experiencing discomfort when I engage in certain activities and I have created a code BASED on these predispositions. Now, I realize this is deep so before I go any further let me state up front: my story is about epic greatness involving a SMOKING hot slam piece Russian chick that I am vacillating about whether to take to poundtown via the Hershey Highway BUT it’s relevant to you pions as well because it can teach you how to avoid this “shame” phenomenon Benito writes so much about.

Since some of us don’t have all day in their parent’s basement to write I’ll go easy on the details. A buddy tipped me off that the Princess might be sampling some fratboy’s groin protein shake so I decided to hit the hottest girl in her class. Because I was in a hurry I used what usually works fastest: money. We did everything and when I was through I cleaned myself with one of the Princess’ childhood blankets. Satisfying. Now for the moral dilemma.

So it turns out that this fine undergrad slam piece is actually 26 and used to be a prostitute. Not one of those trashy scags you see in AC or one of those high-class call girls but a child prostitute in the sex trade from the age of 14-19. I found this out when I made anal overtures and just as I was loobing the tip she goes “I could really use help with this semester’s tuition” – now mind you this girl was hot enough that I’d have put her through dental school but she pulled back just short of the promised land with the following “do you want a gf or a whore?” I mean, I was looking for something between a fling and a fuck buddy with a side of revenge but if I had to choose…eh, hard to say. Next thing I know she is crying and telling A LONG story with countries I’d never heard of culminating in her acceptance to UPenn student visa yada yada.

I didn’t bang her then and there but that was strategic. As the only Male under 87 she’s ever known not to either pound her or get paid because she was pounded I am now a god to her. But now I feel bad about banging her, given that I lied about tuition, am seeing someone else and oh yeah went back and tapped the A. And taped it.

The reason I feel bad you see is that she gets sent back if she loses her student visa, which of course she does if her tuition check bounces or never comes. So I ask myself “why am I predisposed to sympathizing with whores?” maybe subconsciously I am aware that a close female relative is or was a whore. Maybe and I am man enough to admit it. We accept we can have whore sisters and daughters because we are forced to watch it happen. Just because nobody wanted mommy after our half-bastard selves made them tight as a moo-moo and as perky as snot hanging from a nail doesn’t mean she is anymore virtuous. Also it could be my feelings for the Princess. She’s not a prostitute in that she takes money for sex like a cashier takes money for groceries. She’s more like an exclusive club where you need money to have your membership considered, and there are considerable dues.

In the end I think I will keep hitting it because what if on a future psych evaluation my whore sympathy might become known and reflect poorly on the fam or the princess.  Still, I am worried that I spent the better part of a beer contemplating this as this might get my bro card revoked.  Still, I’m also man enough to admit that even an alpha bro with a hundred notches in his belt occasionally accidentally develops feelings for a skank.  You’re predisposed to something in this particular trick’s nature to cause you to act differently.  Doing the “right” thing is therefore an indulgence.  Take her to poundtown and send her out the door by 7…resist that urge to get donuts and coffee.

I’m not doing well folks. I’ve had a series of financial and career (or lack thereof) humiliations that are still so traumatically fresh I can’t even blog about them. They are also so outlandish that to describe them would likely lead to other specifics being known about my life that I want to keep private. So I turn to my shame diary. I won’t tell you what’s in it but I will tell you what it is, how to use it and how to tell if you need it.

A shame diary is exactly what it sounds like. You write about the specific events that compromise your dignity and self-respect as an educated person, possessor of marketable skills and the potential to learn them and as a human being.

You use the diary to bring into your conscious mind various occurrences and think logically about how to regain your dignity and self-respect by overcoming one obstacle at a time. Hypothetically, say you lose a job and get driven out of that industry that requires your specialized highly expensive degree.  You write about that, everything it cost you including time and the money you could have made if you had been working then you brainstorm what it would take to REALLY redeem yourself. Obviously simply getting that job or one like it back wouldn’t do it because what would be the compensation for the period of exile? You would need a better job at a better company.

I don’t think a shame diary can ever hurt but here is how you know you need it. Events that if isolated might cause little to moderate embarassment for yourself or cause you to envy another have the potential to manifest themselves as physical symptoms. Eventually you begin to have mental breakdowns every so often, manifesting themselves in blackouts or complete dissassociation with the catalyst for the break. In the aftermath everything in your life is a reminder of some failure at some point in your life. A classmate’s promotion or friend’s new baby reminds you of how you failed to make the high school football team, which reminds you of a bad assessment at your last job, which in turn reminds you of something you messed up on your first job which reminds you of how a girl you settled for dumped you by letting you catch her cheating. Basically it’s an involuntary brain dump of why you are worthless.

A shame diary let’s you draw these things out of your subconscious and into your conscious mind by essentially allowing you to “keep score.” By knowing when the score becomes more lopsided you can predict and mitigate breakdowns. By knowing how little small triumphs actually go to even things out you avoid the trap of thinking the score is settled or that you are “cured” or “fixed.”

We have the AIDS of debt. There is no cure, no bankruptcy. We don’t live through it. We live with it.

It’s already August folks so if you have comments or questions for our guest columnist now would be the time to ask.

There is only one thing worse than rejection: rejection by ommissiom. After my first two years of writing I got the hang of the whole initial query process. In fact even now I am impressed how quickly I can compile a list of agents and get a query out of the virtual door. But just as the worst lies we tell are those where we withhold key information the worst rejections are those where the key information – namely the agent no longer has any interest in our work – is withheld perhaps indefinitely.

Look, I am a patient man. I looked forward to Christmas like any other kid but it never drove me insane. Neither did the wait for my driver’s license, the vote, or legal drinking. Even when I query I can forget about the letters as soon as they are sent and throw myself back into an unfinished project. I get a form rejection and it rolls off my back like water off a baby hippo.

The problem comes when an agent asks to see more, or worse when half a dozen agents do. It’s like when you are interviewing for a job and you receive several callback interviews. You know you’ve risen above the riffraff and figure statistically chances are on your side. You begin to think of yourself as an employed person and imagine spending money and looking at relatives without that familiar mutual look of shame in the eyes of all involved.

Once again I am patient. It’s not the fact that it can take an agent 3-6 times as long (aka six months to a year) to get back to you after that initial positive contact. It’s that they might not get back to you at all. Unintuitively, the nicer an agent is the less likely they are to get back to you.

Case in point: I had an agent who sent me the most glowing letter I’ve ever received. I followed up with him like clockwork every three months to let him know what new developments there were in the news and strides I was making with my writing. Around the one year mark I couldn’t take it anymore and told him there was another (albeit far inferior) offer on the table. And I never heard from him again. Even though I know he had no intention of ever representing me I still in the back of my mind wonder what would have happened if I had never sent that email.

So let me bottom line it for you. Getting publishing is like surviving a nuclear attack on your city. Yay! You made it to the bunker. But now you’re probably going to die slowly of radiation poisoning or in the chaos of the ensuing anarchy. IF you die, it’s better to get incinerated at ground zero. But you know what? I’d still rather survive the initial explosion. So I keep writing. Hopefully you will too.

I am like a Gazelle crossing the river who has just been told there are more crocodiles in the river than ever before.  I run full speed towards the water because I know there is alot of green (and females) on the other side.  But when I get to the banks I take a hard turn and wait for the others to dive in so I can see the crocodiles snap so I know where they are.  I don’t slow down when those on my left and right fall – I know there is blood in the water.  When I make it to the other side I rejoice in the fallen because there is more grass (and females) for me.

Bet you thought this was an Icarus 30 post didn’t you?  Ha! No it’s your man KF Li.  Here are more tips from the titan of timesheets, the founding father of fraud, the liar’s liar…Mr. Michael Triforce, on how to get that check and avoid the ax at a law firm including why you should never rationalize your actions, how to play mind games with your fellow associates, how to keep your office and your person so you look like you’re billing what you say you’re billing.

#4  Never Rationalize.  Who gets caught, the cold-blooded killer who kills for money and power, or the man who kills in the heat of passion? Obviously the latter.  Look, nobody ever gets caught caught falsifying hours, but partners do look at them and they cut hours when they feel the client won’t pay and sometimes to keep a rising star from shining too bright.  “Honest” lawyers fudge hours too, but they have thought processes like “well, I spent eight hours here, but I can only bill two, so let me spread these six hours out elsewhere on these other matters” or “well, I am working on the weekend, so I am going to bill for my commute to and from work, PLUS an extra two hours because I am missing the birth of my first child” and so on and so forth.  Idiots.  When you’re faking your hours you should only ask yourself ONE question…can the file bare the weight of the hours?  That’s it.  See, other lawyers are trying to arrive at some kind of “fair” result.  Well, are you a mediator or are you a litigator?  A litigator says to hell with what’s fair, I want all I can get because this is a zero sum game and what I don’t take will be taken from me to the tune of ten to one.

#5 Always do all of your hours all at once, at the end of the month.  The idiots you work with create ABSURD timesheet records by making dozens of little rationalizations a day which by the end of the month number in the thousands.  It is then the partner’s job to take the pile of shit you just gave him, consider the file, and shave what you’ve billed into some kind of semblence of sense that hopefully the client won’t look at too closely because all you’ve done on the file is scratch your ass and chase your tail, while meanwhile the senior associate is banging his secretary and the partner is trying to figure out who his wife is banging because he’s never home.  Instead, you need to write that story yourself by doing all your hours at once WITH YOUR RECORDS FROM THE PAST SIX MONTHS so the trends add up and everything makes sense.  Triforce thinks its funny that Law Professors get a bad rap for never reading student exams and grading things randomly because the truth of the matter is next to a partner at a law firm a law professor is downright accountable.  If you do your partner’s job for him in this respect like you do in every other, he’ll green light your hours every single time.  Also lie to your fellow associates, but lie with purpose. 

#6 Look like shit.  Chances are if you work in Biglaw you already do, but I mean REALLY let yourself go.  Take Mike Triforce.  He shaves once a week if that.  He has a disgusting brown shaggy mane of hair that makes him look like, well…Shaggy from Scooby Doo.  His clothes never match and all his pants are too tight.  I asked him if perhaps he’d been a little lax with his ab routine but he told me it was all for effect.  I wish I could post a picture but again our secret identities…but we’re talking male camel toe, shirt with two buttons open and no undershirt so the carpet of chest hair is visible, AND I promise I am not making this up…a head band, like Lebron or Rondo would wear.  It keeps the hair out of his eyes when reviewing documents while simultaneously indicating he doesn’t have time for a haircut.

Hi kids.  So a buddy of mine just got laid off.  He’s in the very early stages of dealing with it.  Right now he is still looking for someone to blame.  It’s a sad situation.  He was supporting his live-in girlfriend who came with a freeloading half-brother with a drug problem and a dog who likes to pee on expensive things.  His folks are down on their luck as well and he was throwing a few dollars to his sister whose still in school and his mom and dad who are trying not to fall further behind on rent.

When I got the news I went into business mode, the way a doctor would if someone told him that they guy two rows over was having a heart attack.  Unlike a doctor though my efforts and expertise were unappreciated.  I was called insensitive and a bunch of other names.  I was reminded that I was still unemployed and the worst possible thing for anyone to imagine was a life that was in any way similar to my own.  Thanks.

But you guys here in Debtor’s Prison need to know what to do when the ax falls.  Because we are emotional creatures its impossible to have the conversation once you actually do lose your job (just like you can’t take Karate lessons once you’re being mugged).  So without further ado here is how you survive a layoff 1) move 2) get unemployment and 3) defer your loans.  More details after the break.

Everyone experiences the loss of a job differently.  What is universal however is the loss of income.  Therefore the first thing you must do is drop your expenses to the level of your new income.  If you’re in debtor’s prison most likely you rent.  The sooner you swallow your pride and move the better you will be financially in the long run.  Break your lease if you can, find a sublet if you can’t.  Move in with a parent, aunt/uncle, high school buddy, whatever.  I would advise against moving in with a significant other – it’s bad for relationship dynamics if you start cohabitation under the cloud of a firing.  As for your stuff, sell as much of it as you can.  If you’re in debtor’s prison you probably don’t have much unless you also have massive credit card debt.  If you DO have a lot of stuff you’re about to become very familiar with craigslist and e-bay because you’re selling it.

Now for you homeowners first let me say congratulations! You have a real asset.  Now might be a good time to roll your student loans into that (that way if you lose your house at least you have a fresh start in seven years once your credit is repaired).  It’s also time to find renters and beggars CANNOT be choosers.  Also this is a volume business.  Three assholes paying $600 a month is better than two saints paying $800 a month.  This is basic math.  There shouldn’t be anything valuable left in your house either once they move in because you sold it and as for damage that’s what security deposits are for.  Now you might be asking yourself where you will be living if your house is full of renters but I believe I covered that in the earlier paragraph.

Next is unemployment.  Get on it.  I don’t care how much you’ve saved or how sure you are you will find another job in a month.  Get in the bread line because its long and you have to be in it for a certain amount of time (depending on the state) before you even get that first crust of bread.  Find out how many months you can be on unemployment before you are cut off.  YES you have to pay taxes on unemployment.  YES you are going to have to save as much as you can out of your bi-weekly check because its not going to last forever. 

Here is the most complicated part.  Of course your student loans.  Defer them.  You have no choice.  I realize interest will continue to acrue.  I know the effects of that are devastating, particularly if you have been aggressively trying to pay down your loans, using money you could have saved for a rainy day such as the one you are currently experiencing.  But that ship has sailed, and that was part of the risk you took when you began paying down your loans aggressively.  What you should have done (and don’t feel bad I didn’t know this either during my brief stint of employment) was to pay the minimum amount on your loans while simultaneously creating an aggressive savings account with the purpose of paying off your loan in its entirety once the account became large enough.  That way if you are laid off you still have that money to work with and possibly use to pay your loans during your time between jobs so the interest does not get out of control.  Finally if it is at all possible, do ANYTHING YOU CAN to make the INTEREST PAYMENTS ON YOUR LOANS.  You should be able to work something out with your student loan representative.

That’s about it kids.  What happened sucked.   It probably wasn’t your fault.  Unfortunately there is no time to deal with the humiliation, heart ache, sense of brokeness and the horrible horrible feeling that you let your family down.  You can work all that out in therapy once you get a new job with good benefits and I encourage you to.  But right now you have leases to break, roommates to find, DVDs and videogames to sell, labor and employment offices to contact and loans to defer.  This is the CPR that must be performed before help, in the form of another job, can arrive.  And unfortunately you live way out in the country.

[Original content temporarily suspended as a professional courteousy until the ethical investigation is complete. Older posts that failed to make the original cut will be rotated and substituted. If you have any questions, thoughts, concerns and most importantly if you need a copy of the ORIGINAL POST please contact nick@debtorsprison.com]

I got into the office uncharacteristically early because the Princess’ foghorn-like snoring kept waking me up. I stumbled upon this link (Link, get it?) from ATL

http://abovethelaw.com/2010/03/mutiny_at_mayer_brown.php#comments

For those too lazy to follow the link two kids who got deferred from their law firm made a stink about it. Over 300 comments followed, most stating the obvious: they’re ruined. Here’s what the two plucky bastards SHOULD have done, particularly if their deferment came with free money.

First, a tell-tale sign of loserdom is desperation. By whining these kids have made themselves seem desperate. Law firms generally want winners. Next, there are four general gentlemanly pursuits for the young elite to make money while waiting for their next legitimate gig: poker, pool, sport gambling and day trading. Bar tending is fun, easy, and leads to encounters with promiscuous individuals but unless you move their is always the chance of serving someone at your future firm or worse a future opposing counsel. Mastering a gentlemanly pursuit also keeps paying once your day job starts, particularly if you neglect it, which I do.

Me? I’m a card player. Always have been. I think that’s what lends itself most to lawyering. For you coordinated types pool is the way to go. It’s geometry with a dash of physics folks. For those on the cerebral side day trading is probably your best bet. Finally, if you are skilled in none of these your best bet is finding a bookie.

Ever notice how the girl who knows nothing about basketball always wins the office/class pool? Ever wanted to be that vacant eyed, hair twirling, leg spreading wealthy misfit? You can. Here’s how.

The best jobs in the world involve taking something an expert took countless hours/days/years to create and finding fault with it. Political pundits, Movie critics and…sports casters. All you have to do is read the expert opinions and bet on cases where for whatever reason you think they are wrong. Given under dog odds you can be wrong 75% of the time and still make money. The only catch is you can’t make bets involving teams you care about. When you think about it you can’t lose.  You are betting that even experts make mistakes and you’d be right 100% of the time.

There are lots of other great ideas to make that dollar. Set up a fake literary agency. Read college essays online. Assist minors in throwing parties. Put your girl on the corner where the Princess is heading if she doesn’t stop snoring like a jack hammer, I don’t care how late you were out closing out the bar and PLEASE shower when you get home…so angry. I could go on but Benito has requested that I stop advocating for illegal or unethical courses of action. He’s worried someone at my firm will read this…let me repeat. I DONT GIVE A FUCK! Personally I’d be more worried about the Princess reading this, lest she enter the world’s oldest profession as an entrepreneur instead of as an employee.

Hi Kids. People have been commenting that there has been less useful information and more paranoia, idiocy and douche-baggery in recent posts SO yours truly has decided to start at the beginning with this simple principle: You are taxed on what you make, and you pay interest on what you borrow. If this simple truth does not inform your big picture than you are hopelessly at risk of over borrowing.

Now I know what you’re thinking, if you got into a school good enough to merit borrowing to attend, then you should be able to add and subtract right? I am sure each of us has made decisions that are different from what we would have chosen as our answer if our situation had been presented to us as a word problem on the SAT.

Let’s take the following example. Most students, generally speaking would be willing to borrow twice as much money for an education where graduates typically earn twice as much. After all debt is a one time expense and you can enjoy your higher salary for the rest of your life right? Now let’s apply our new Golden Rule.

Turns out the take home of someone who makes 100k isn’t twice that of our buddy making 50k. Uncle Money Bags is taxed at a much higher rate. Now let’s turn to the debt. Turns out Uncle Money Bags had to take out private loans with a much higher interest rate and his monthly payments are well over twice that of our buddy making 50k.

But still things will even out right? Eventually Uncle Money Bags will win out, I mean he wants his money so…badly. Maybe it does and maybe it doesn’t. The heavy borrower is much more likely to pay several times the principle over the course of the loan. Also Uncle Money Bags could get laid off at which point he has no bankruptcy protection. In theory he has the option of forebearance. However a bank or loaning institution is less likely to trade money for a sob story as the tooth fairy is to trade a quarter for eight inches of used floss. Turns out a debt is a lifetime expense while your income is tied to the job security in your field and the economy as a whole.

I realize I am biased. My main source of income has just switched from snow shoveling to washing the undercarriages of cars with my new invention “hose on a stick” and I live at home. My own mom is ashamed of me and rather than recite my sad saga just tells church members I have a drug problem.