In Defense of Student Loans

There is so much negativity surrounding student loans. Today, I was discussing my large outstanding student loan balance (Roughly $90k as of the writing of this article) and the person I was talking to was shocked and very concerned for me. They then informed me that they didn’t have any debt at all and that they were living the good life. While I do realize that being debt free is the ideal situation, I think that the type of debt that you have matters. To me, student loan debt is good debt because it provided me with an intangible asset that is in fairly limited supply. Credit card or other debt that finances depreciable assets are not smart ideas because the money you are borrowing is for something that loses value over time.

This loan conversation stemmed from mentioning that I was going to become an Uber driver in my free time (Hello, side hustle) and the debt free person I was talking to said they could never do that because they didn’t want to spend their weekends working. It seemed as if the debt-free person wasn’t as motivated to earn more money in their spare time or wasn’t as concerned where their money was going.

I think that one of the biggest advantage that student loans provide you with, besides a great education, is a greater work ethic, knowing that you have to repay the loan amount eventually. I know that personally, knowing that I have to pay off my loans has encouraged me to look for ways to earn more money and cut costs in other areas of my life. I think that without the loans, I may not be as willing to try and earn extra income or cut unnecessary costs.

So, I think that overall the loans have provided a large benefit to my life, and think that loans can help finance an education that may be unattainable otherwise. Not only will you receive a great education but you will also continue to be motivated to be more efficient with money after graduation.