Why We Didn’t Default On Our Student Loans

A few years ago, I read a New York Times Op-Ed piece entitled “Why I Defaulted on my Student Loans.” The author of the essay shares his personal story of borrowing money to finance his college education 40 years ago.

In many ways, it’s a story our family knows too well. After all, over $80K of our $127K debt was in the form of student loans.

Like the author, Lee Seigel, my husband and I both worked at a mall when we were in college. My husband’s hardworking parents didn’t have college degrees and couldn’t afford to finance his education.

After graduation, when he chose to go to a state law school, as young newlyweds we were encouraged to borrow the full amount, even though it wasn’t necessary to pay the bills. Student loans were “good debt” and his starting salary would be more than enough to pay for what we’d borrow within just a few years.

Except it didn’t.

He couldn’t find a job that paid half of what we were told he’d be making upon graduation.

So, we did what many people do (and I’m guessing what this author did, too, in the beginning) — we deferred the loans.

The funny thing is: Just because you ignore a problem, doesn’t mean it goes away. And when your problem is debt, it literally compounds, making it a bigger problem than it was, to begin with.

This is precisely where we were in the spring of 2008 when we began the long and winding journey of slaying our debt dragon. Turns out, one job wasn’t enough to pay off all of our debt.

That’s why my husband took on two more jobs and I became a money-saving fanatic, learning every tip and trick I could, from making laundry detergent to couponing to saving on utility bills and more. This was all so we could pay what we signed on the dotted line for and received.

We borrowed it. We owed it. We planned on repaying it, even if it took the fifteen years we calculated it probably would. The end.

After four long years, we stood on the other side of our debt — that $80K of student loan debt, coupled with car loans, medical debt, a gap loan, furniture purchased on a payment plan, and more unwise borrowing decisions — all $127,482.30.

I’ll never regret paying it back. And, if at all possible, others should pursue the same path.

The process is the remedy. The process of paying off debt taught us never to return to the well of borrowing again. Like a child touching a stove that’s hot, we learned that borrowing beyond our means hurts.

The lifestyle change required to repay debt is painful. Call me a wimp, but I’d prefer a life that doesn’t require unnecessary pain.

Certainly, if we had defaulted or chosen not to pay off our debt, we might have avoided some pain, anxiety, and suffering in the short term but in the back of my mind, I would’ve always questioned that choice.

Honestly, without the sacrifice of choosing to pay off debt daily, we would’ve quickly been back in the same position with more borrowing anyway. Trust me, borrowing (and not repaying) always leads to more borrowing and in the end, more pain.

Instead, we chose to work more, spend less, and be satisfied with what we had. It wasn’t always easy and it wasn’t always pretty, but it was worthwhile.

Our lives are comprised of choices. We’re not puppets pulled by a system; we have free will.

Ignorance of the student loan system doesn’t free us from repaying our obligation any more than ignorance of the legal code means that it would be OK for us to steal money from a bank.

My heart will always feel for those who have borrowed and feel stretched beyond their means. That very hopelessness haunted my soul for years. The darkness of feeling the sum of your unwise decisions bare down on your pocketbook, relationships, and daily life is unbearable.

Higher education is expensive and thankfully, in the 20 years since we attended college and the 40 years since Lee Siegel attended college, there have been stops placed in the system to help better guide students to make wiser choices when borrowing.

I know the deep-seated desire to walk away from it all, pretending I’d never borrowed a dime, wishing it into another place and time.

The path of least resistance is, in many ways, more accessible, but also complicates life. Even Siegel admits he’s still being pursued by the Department of Education to repay what he owes.

A choice to default doesn’t equal an easy street.

In the end, Mr. Siegel calls upon students to follow his example. It almost sounds like power to the people, a cry for hope, to change the system.

But before you burn your statements and run into the streets, realize that Siegel is 57 years old. He has a Bachelor’s and Masters from Columbia University. He’s written for The New Yorker, The Wall Street Journal, The New York Times, Harper’s Bazaar, and The Nation, and penned five books (including a forthcoming memoir about money).

I point this out not to deride his character but because upon a quick read of the article, it didn’t fully dawn on me he was nearly two decades my senior and a much more accomplished writer.

He’s not a millennial with limited job opportunities. He’s not a Midwestern kid who is overwhelmed by a complicated system. He’s making a choice and apparently, he’s proud of it.

We decided not to default on our student loans and I’m proud of that.