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September 13, 2012

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SC,

I think the most important thing for you is to make sure your investment in the masters degree will pay off. I would go back to the FMF article:
When It Comes to College, Begin with the End in Mind

Read it and follow all of the steps to ensure that your hard earned money will end up giving you a job. Your best course of action may be to find a different school to finish your masters degree.

-Rick Francis

SC --

Here is the article Rick references:

http://www.freemoneyfinance.com/2012/08/when-it-comes-to-college-begin-with-the-end-in-mind.html

As far as the car, how is it going to die? If it has 200,000 to 300,000 miles it may be time for a new car but Hondas are pretty reliable in the 100,000 mile range. You will have to save for repairs but it could be cheaper than a new to you car. I wouldn't think you would want to add another payment while getting a masters degree with no job.

Do you have credit history? You may not be able to finance until you build one up. If that's the case, apply for a secured credit card. Load up $500 on the card and charge some expenses on the card. You will keep reloading the card and then charging it down. As time goes by you'll develop a credit history to then buy a regular credit card. Pay those off on time and you will open up more options for your future.

Do you have public transportation available to you? Exhaust all your options before buying another car.

Do you need to fly home every year or can you do it every other year? Tickets are expensive, but also most people spent just as much on gifts and it adds up. Unless you have a particular family situation (e.g. ailing parents) skip it one year and take a trip within the US instead - cheaper and helps with integration. Believe me, it gets easier - 2 years you still feel the nostalgia, but if you are committed to staying here you have to loosen a bit the strings to home.

Also invest in creating a network that will help you with your career. Use the masters program not just for studying but for meeting people and making connections in your chosen field. I mention this as foreigners like you and me tend to neglect the networking in favor of time with the books/research. I've learned that the former matters just as much if not more.

I agree with Ivy. I came to United States 11 years ago, and I have only been back 4 times. Going back is very expensive. (air ticket going back, money giving to family members, things that you buy back there). For the years I skipped, I travel around in US & Canada.

If you weren't already in school, my advice would be easy: delay your master's, save for the car and the degree, then go. Since you're already there, it's a little more complicated, but my recommendation is still: AVOID STUDENT LOANS AT ALL COSTS. They cannot be discharged in bankruptcy. You will pay high rates, most likely. 6.8-8.5% is normal for graduate degrees, if not higher now, unless you take a variable-rate loan. (And with the Fed dumping endless money into the market, that's a risk I wouldn't want to have! It's only a matter of time--and it may yet be a good while--before serious inflation sets in. But it's no longer an "if," it's a "when.")

Consider taking a leave from school to pay for the car and save enough to resume. Take on a second job if you can. Whatever you do, don't finance things; avoid debt at all costs. It's a plague. And, like you said, the economy is bad and it's a hard to get a higher-paying job. Or perhaps even a job like the one you have. It's worth it to wait, even if it's painful to do.

Educational debt is THE worst debt in this country. And, once you're a borrower, the loan companies have total leverage over you: you are their slave. Read some of the frequent horror stories at consumerist.com or elsewhere on the internet. I have had some bad experiences myself (I have lots of student loans, though mine are almost paid off), and I pay on time, every time, and am waaaaay ahead.

Anyway, best of luck to you! Sorry my advice is dreary. Don't like seeing good people fall into the debt trap.

Also, if you're not a US citizen, you may not be able to finance. Banks and financial institutions will be understandably wary of lending you money, knowing you may just abscond to your home country with it. Ditto student loans. I think you can get federal student loans (gotta love our dumb government), but I'm not sure of it. So that's another reason not to consider financing. If you do get financing, I would assume your credit scores will be automatically lowered/your interest rates will be significantly higher. I wouldn't guarantee it, but if any institution is using anything like good underwriting it would be--since you have such great connections elsewhere, and fewer here, you're *far* more of a credit risk. (Since you're on FMF, I assume the best, but the banks don't make those kinds of judgments.)

Hi Thanks for all responds.

Rick,

As I said in the article, I am not going to back off my goals on education. I am not worrying about how much I will spend for my further education. While I was writing this article to FMF, I had that job, but I just quit my job before my first day of class.

At the end of the day, even it is intellectually, my education will be valuable than times that I spend at work.

Lance,

I just took my car to mechanic and he told me that my car's transmission is almost dead. The total cost of it not that much expensive. I am going to repair it and continue to drive.

Luis,

Thanks for your advice. I have a pretty good credit score which is getting better,especially I moved in a new home.

Luis,

I just did what you say. Last July I went to visit my parents, it was two years after when I first came here. You are definitely right tickets are expensive even in summer times. I can not be able to see them next year. I also traveled Canada and north east part of the US. I like to be here.

Nicole,

You are also right. I do not need to help my parents but my sister. She is at the university. I am often supporting her.

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