What Get Out Taught Me about Student Loans
Warning: Spoiler Alert
“3,000 preventable student loan defaults each day in America is 3,000 too many.” — Rohit Chopra, Consumer Federation of America
Nearly two months after its release, I ventured on a solo date to see Jordan Peele’s genre-bending film, Get Out. After dodging countless spoilers, I finally experienced what others had been raving about on social media and in group chats. Although I expected a horror film, I found an artfully crafted satire that had my mind — not just heart — racing. This was accompanied by quite a few laughs as well. Many think pieces have explored Get Out’s racial, political and social motifs. I saw a compelling parallel in my own life and decided to share a few lessons learned from a different angle.
Like other millennials, I am navigating the ups and downs of “adulting”, particularly the financial journey of repaying student loan debt. It’s a topic that many would rather not discuss. But with a generation of young Americans entering a black hole of debt, it’s unavoidable. The average undergraduate student borrower graduates with $30,000 in debt and nearly $60,000 for graduate students. The Consumer Federation of America recently reported a sharp 17 percent increase in the number of borrowers defaulting on their student loans from 2015 to 2016.
We need an urgent awakening to release borrowers from the hypnosis of student loan debt! While I recognize every borrower does not have the same financial means to repay debt, the core message is awareness. We can make informed decisions about debt management based on transparent information and change the course of our generation’s financial future. Here are the central lessons I learned and hope to share with others:
Someone always profits from our loss
Who profits from the student loan debt crisis? Certainly not the 42 million Americans who currently owe over $1 trillion in federal student debt! This does not begin to account for the borrowers with student loans from private institutions. Key stakeholders like Wall Street banks, colleges and the US Department of Education (DoEd) are betting large and cashing in. They drain unsuspecting young graduates by preventing them from living their best life and are producing a new debtor class.
We know Sallie Mae by name, but many do not know that her rich Uncle Congress, opened up a new world of profit when the student loan program was privatized. The DoEd contracts with several private loan servicers, and according to a 2016 investigative report, “… earn nearly $1 billion a year in fees”. It’s estimated that The DoEd can earn 20 percent on each loan. These profit margins in no way benefit borrowers and the number of individuals defaulting on repayment is steadily rising.
It’s estimated that The DoEd can earn 20 percent on each loan.
The chilling “Bingo” scene in Get Out is one of the most unforgettable. A silent auction, conducted by Dean, mimics early American slave auctions. The highest bidder owns and has the opportunity to take control of the body of a sacrificial “host”, Chris, in this case. The shell of the individual lives and breathes, but their decisions are controlled by someone else. Likewise, the crippling effect of debt leaves borrowers with control to move, work and make payments, but less autonomy to make personal decisions about their career, home ownership or family planning due to the crippling weight of debt. Millions of Americans bear the burden of student loans and it’s changing the way we live, plan for the future, prepare for retirement and the US economy.
Don’t be distracted by inviting yet deceitful traps
The cheery sights and sounds of the suburban utopia (read:The Armitage estate) can easily lull the viewer into a cultural stupor. For the observant viewer, there are countless signs that something isn’t right from the beginning. Donald Glover reminds us during a musical interlude in the opening scenes to “Stay Woke”, everything is not always at it appears and we have to stay socially and politically aware. While Chris seems increasingly uncomfortable with his new surroundings, he doesn’t critically question them until it’s too late — despite warning from his friend, Rod.
Like Chris, we receive signs about the dangers of debt, but we often write off student loans as “good debt”. We accept the fact this debt crisis as the “new normal” and believe everyone is saddled with student loans for at least ten years. We minimize the effect of taking out the maximum borrowing amount, deferring payments, high-interest rates, or repaying using income-driven plans. As borrowers, we should question every aspect of our repayment process and remain alert to proposed policies that impact student loan programs.
See recent news about the Public Service Loan Forgiveness Program
The warm welcome of the Armitage family and their friends is much like the enticing repayment plans offered to unassuming consumers. We trust that servicers (debt collection companies) and the DoEd have our best interest in mind by offering plans that don’t “stretch” our budget. Who wouldn’t like to repay their loans by making minimum payments for ten years with the balance forgiven?
On face value, these plans are the answer to every struggling young professionals’ budgetary challenges. The myth of “good debt” and extended repayment plans are the most deceitful traps for borrowers. With a focused budget and specific repayment date in mind, most can avoid these traps and repay their loans in much fewer than ten years! I plan to share more about this methods in the future.
Where would we be without friends?
We all need an honest friend to save us from ourselves at times. Rod, TSA agent extraordinaire, is the undeniable hero of the story. He is a loyal friend who looks out for Chris’ best interest, even when Chris is too blind to protect himself. Although Rose appears to have wooed Rod into submission by developing a playful relationship, he remains on-guard about the too good to be true family.
The theater erupted and we released an audible sigh of relief when Rod comes to Chris’ rescue in the final scene. We may not be able to avoid every student loan pitfall, but It’s important to have an accountability partner to keep us on track as we work to achieve our repayment goals. The process is challenging and it’s understandable to lose sight of our goal when it feels so out of reach.
Dave Ramsey has been a useful resource — as I’ve shared with many — in my personal repayment process. He’s a straight-talking, no-nonsense businessman who specializes in helping everyday borrowers navigate their debt elimination journey. Knowledgeable, yet brutally honest, he’s helped thousands of families learn about budgeting, investing and the steps to achieve financial freedom. Dave often reminds readers and listeners that the level of sacrifice and focus required to achieve freedom is “gazelle intensity”. Rod doesn’t give up on Chris, he relies on his instincts (and TSA expertise) to lead him to his friend. We need friends like Rod who are a listening ear but not afraid to have tough conversations and hold us accountable.
Fight Like Hell to Get Out!
Finally, when we come to the realization that we’re in the “Sunken Place”, we must fight like hell to get out! Don’t become permanently trapped in student loan purgatory, making minimum payments on a balance that steadily increases by the week. Resist the out-of-body state that suppresses consciousness and robs us of agency. Be alert to the “flashes” of knowledge that are attempting to shine light on the reality of the debt crisis.
Despite the insurmountable odds, Chris outsmarts The Armitage clan and finds the wherewithal to fight back. Others, like Georgina, Walter and Logan, could not be saved. They “missed the movement”, as Chris notes, and some of us are missing it too! A systemic hypnosis is changing our views on debt and freedom. We may have friends who are not ready or able to make the sacrifices necessary to aggressively repay their student loan debt. However, when we are ready, we need to find trustworthy sources of financial information — that don’t profit from our situation. It’s also important to avoid the enticing offers of extended repayment plans and dig deep with extreme focus to find financial freedom. I hope my experience and lessons learned serve as a “flash point” for others to realize that we all exist in the “Sunken Place” to a degree, but have the knowledge and courage to emerge.
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