In The Total Money Makeover: A Proven Plan for Financial Fitness, author Dave Ramsey tells this story of a college
A couple of years ago, I met with the dean of the college of business from the university where I graduated. At that time, the average college student graduated with about $15,000 in student-loan debt after spending three of four years in an apartment, not the dorm, and eating off-campus, not on the meal plan. The average student paid $5,000 more per year to live and eat off-campus than to live in the dorm and eat cafeteria food. The student loans that they "had to have" or they wouldn't be able to go to college weren't for college at all. The student loans, on average, paid for an off-campus standard of living, and no debt was needed to get the degree, only to look good while getting the degree.
I've documented the ever-growing college loan situation in several posts including the following:
I used to think that college debt was accumulated simply to pay for tuition and the basics of room and board. But Dave's comments made me wonder -- how much debt is being racked up simply to support a lifestyle at a certain level? If it's true that students are leaving college with thousands in debt simply because they prefer to live and eat off campus, then my sympathy level for them (which was already pretty low to be honest) just dropped through the floor. As you might suspect, I don't have any compassion for someone who generates a lot of debt buying stuff that they really don't need.
I'm not sure whether this is common or not, but now that I think of it, doesn't it seem likely that at least some of the very high levels of debt that some people leave college with (I'm talking $50k+ here) was generated because of lifestyle choices (where they simply preferred to live one way rather than another)? I had these choices as well. But I lived in the dorm even in grad school and ate at the cafeteria as well. Not the greatest food, mind you, but a lot cheaper than alternatives. So, as I said, I do not feel sorry for those who have to have a certain type of place to live, eat certain food (barring a medical condition), need the latest tech devices, etc. and thus leave college with a large amount of debt.
What do you think? Do you think this is common or more the exception than the rule?