Students Need More Financial Literacy

Lessons Learned from a Meeting with a Student Loan Expert

Credit: Etsy

A student loan expert came to my law school last Friday.

The administration offered graduating students the opportunity to meet with him for 45 minutes. I signed up for a time slot with him, of course.

But I couldn’t hide the dread and fear I had before walking into the meeting room with.

Because I graduate in May, I’ll have to start paying off my student loans in the coming months — a prospect that has petrified me for quite some time, considering the monstrous amount of student loans I now owe to the federal government.

So, in light of the anxieties I have about my financial status, I suspected that this meeting would be grueling.

I imagined being asked questions like, “Why exactly did you make the decisions you made? Do you realize how much money you’ll owe for the rest of your life?”

In preparation for the meeting, I also had to print out the long list of loans I’ve taken since being in the United States — a list by which I felt embarrassed. Not to mention the total sum of loans printed at the bottom of the two fully printed pages.

But, as it turned out, the meeting was nothing short of refreshing, empowering, and eye-opening.

I’ve spent the vast majority of my life in school, which means that I’m used to learning new material and digesting it in various ways.

But gaining financial literacy through the one-on-one conversation I had with the expert was unlike any educational experience I’ve experienced.

It changed the conceptions I have about offering advice to someone who’s uneducated about a specific subject. In this way, I gleaned insights that I’ll apply later in life — when I’m an attorney and, hopefully, an educator.

Specifically, the meeting taught me how to approach complicated systems — in this case, the student loan system — and pick them apart.

It showed me that students, when it comes down to paying off debt, have options — and a good number of them. Perhaps most importantly, it also showed me that my future decisions will not have to depend on my debt load.

“Are you okay with living with more than 90 percent of your annual income?’ the man kept asking me. “If so, then you have nothing to worry about.”

Hearing these magic words brought my anxiety down by multiple levels. And it also showed me how ignorant I am about an important problem for which I voluntarily signed up.

Behind the student debt problem is a web of fairly complicated economic calculations that dictate whether the entire system will be successful.

When federal lawmakers in the U.S. Congress came together — probably alongside a number of sophisticated economics — they likely asked themselves about the minimal protections that they needed to offer students to get them in the door.

In other words, lawmakers needed to create a list of incentives — public service loan forgiveness programs, caps on how much one has to pay based on their income, and so on — that make the student loan investment less risky.

This kind of economic decision-making must happen all the time — and throughout a wide variety of policy arenas. But, as a consumer, I’m not automatically made aware of such activities.

I start out on a blank slate, ignorant of political decisions that might have a tremendous impact on my life.

But, the second I learn more about these decisions, I become closer to the political process. I become more acquainted with the strategies that policymakers can use to advance certain policies and programs.

As such, I now perceive my meeting with the student loan expert almost like an exercise in citizenry.

By translating incredibly complicated statutory and regulatory jargon into understandable words, the student loan expert taught me to divorce intuition from reality — a distinction that is not obvious in the financial work.

He asked me on multiple occasions to have “a paradigm shift” in the way I approach my student loan, because these loans are almost nothing like a normal house mortgage or credit card debt.

Learning this information, as simply it may be, helped me understand that I made — and am still making — the right choices.

It also allowed me to take a deep breath.