Middle class parents in the United States (and I acknowledge that “middle class” is an entirely subjective term in the United States) are going to have to make sure they have the talk with their college-bound teenagers from now on. You know, the talk.
America’s middling moms and dads already understand they are expected to have the drug talk (marijuana will never kill you and is probably healthier than drinking but a criminal record can ruin your future so just say no), the sex talk (for girls: don’t dress like a slut and save your punany for a guy who’s going places in life; for boys: wrap that shit up and make sure you at least call her within 24 hours lest she accuse you of raping her), and the race talk (for black kids: whenever you see a man in uniform, spread your cheeks, lift your sac, and mind your manners; for Hispanic kids: never leave home without your passport, driver’s license, birth certificate, social security card, three separate utility bills, and a notarized affidavit from the homeowners association swearing that we live here; for white kids: never venture north of 96th Street and always carry a little cash on you because if you’re wallet’s empty when they mug you, they’ll be more likely to violently take out their rage and anger over 400 years of slavery and oppression on you personally out of pure spite; for Asian kids: I don’t care if it’s Saturday, 70 degrees, and sunny and all the other kids are playing ball outside . . . weekends and holidays are for the other, less disciplined races . . . now do your homework!).
But now, rising tuition and persistently high unemployment are giving rise to a new talk that all parents must have with their kids before they matriculate at one of America’s fine institutions of higher learning. That talk goes something like this:
You know how we always used to tell you that you can be anything you want to be when you grow up as long as you work really hard at it and never give up? Well, that’s not exactly true. You see, the cost of sending you to college for four years, when you factor in tuition, room and board, health insurance, books, and so forth, is over $200,000. That’s money we simply don’t have ever since your father got downsized and had to cash in his 401(k) (at a time when it was worth half of what it was worth before the economy crashed) so we can continue to pay our bills. That means you will have to take out student loans. Now I know they never taught you basic principles of personal finance in school, but since you are going to end up owing somebody over 200 Gs in four years, it’s important that you know what interest is.
You see, nobody just lends large sums of cash to a total stranger out of the goodness of their heart. If I’m sitting on a lot of money and I let somebody borrow a bunch of it, there’s no guarantee that person is gonna pay it all back. But if I only let them borrow this money on the condition that they pay it back and then some, something is in it for me to be a lender. Now, the chunk of money that they’re gonna lend you so you can go to school—that’s called the principal. You’re gonna have to pay all of that back. But wait . . . there’s more. You’re also gonna have to pay them an extra chunk of money on top of that which is calculated by taking a percentage of the principal. Now focus . . . did you take your Ritalin today? Good.
Now, after you graduate, you will have to make monthly loan repayments. What will happen is, they will pick a block of time for you to pay it all back – say 10 years after you graduate – and then divide the principal by the number of months in 10 years. There are 12 months in a year, so there are 120 months in 10 years. You will owe $200,000, so $200,000 divided by 120 is $1,666.66 per month for ten years. But that’s just the principal! The interest rate on your loan is 3.4 percent. 3.4% of 1666.66 is $56.66. That means you will owe $1,723.33 per month.
That is to say, you will continue to owe $1,723.33 per month for ten years if you consistently make that monthly payment for ten years. If you miss a payment, the interest you didn’t pay will get added to the principal, and the monthly payment you owe will increase! That is to say, the less able you are to pay back your loans, the more you will owe, and the less you will be able to pay back your loans, and the more you will owe, and so on ad infinitum (which, by the way, is Latin for until the end of time!).
So why is it important that we’re telling you this now? Because very soon you will be picking what courses to take and what to major in and you’ll be discovering who the fuck you are and what you’re good at. What we are trying to tell you today is that it doesn’t matter who the fuck you are or what you’re good at. There are certain fields of study that will qualify you to get one of the shrinking number of jobs that will enable you to pay off your debt before you die. You will have to be exceptionally successful within those fields, whether you are good at them or not, and we don’t just mean getting good grades. You will have to know the right people and probably at some point stab your rivals in the back to get ahead.
What’s that you said . . . ? You don’t wanna go to college at all if that’s the price you will have to pay for the privilege? Do you wanna be a loser all your life? You think flipping burgers is a respectable vocation? Let’s get real – you’ve been raised all your life to feel accustomed to a standard of living that you will have to fight to the death now to perpetuate for yourself as an adult. Most of what you know about college you probably got from the movies, and right now, we’re telling you that in real life, for you, the movie you should have in mind when thinking about college is not Animal House or Revenge of the Nerds but rather The Hunger Games with a little Lord of the Flies mixed in for good measure.
So, what fields of study will be most likely to land you a job when you graduate? Well, where do people make money in America these days? Think F I RE – finance, insurance, real estate. Do whatever you need to become qualified to work in these sectors. Yes, I know those are the very sectors that put America in the situation where we have to have this talk with you in the first place, but part of growing up is learning to accept that life isn’t fair. You can either become a part of the problem and continue to live as an adult with the comforts you grew up with as a kid, or you can try to be part of the solution and end up destitute, with a ruined credit rating, unable to marry and raise a family, much less qualify for a home mortgage, and very likely dead or in jail when its all said and done.
Well, I’m glad we had this talk, and remember, we’re both so very proud of you!