Category Archive

Are they “good debt”? Is there such thing? I will provide you with the definitive answer! (Ok, it is just my opinion, as is everything here.) I still get excited when someone links to me. Someone recently (not SO recent, since this post has been hanging in draft state for awhile) linked to an older post of mine, where I argued that the federal government’s investment in my education was a good thing, for me and for them. She is considering student loans, and asking the important question: How much is reasonable? How much is too much? Everyone should ask these questions before borrowing, but unfortunately, not all do.

College students are typically young and not financially savvy, and commercials (used to) abound offering you “Up to $40k a year!” for school. It makes me sick when I see those. That is rarely going to turn out to be good debt. If you can go to college without student loans, that is quite obviously the optimal solution. If you can’t, (I think) student loan debt can be a great investment if and only if (iff for math geeks):

• It is a reasonable amount for the degree and expected salary.
• It has a reasonable interest rate (this typically excludes private loans). Canada also doesn’t seem to offer as nice rates.
• It was needed to pay for college, not to fund an extravagant lifestyle while in college.
  • Disclosure: I took an undetermined amount of extra student loans to help fund my amazing study abroad experience. I did get a $5000 scholarship, but I’m sure I spent more than that. I’m not apologizing for that extravagance, even thought it doesn’t meet my own criteria. It was worth every last red cent!
• Other options were exhausted: Savings, part time jobs, scholarships and grants.

Much traditional federal student loan debt really should be viewed on a different level than credit card debt (though current rate offerings are almost 7%, a little high). However, private loan companies jumped into the game and really mucked things up. If you have $100k in 12% interest loans for a degree that commands a low salary, it is hard to say that was a good investment (individual exceptions may apply, as well as non-financial benefits of college). If you have $10k in loans at 2.0% tax deductible interest (some people do have those crazy low rates) for a degree in almost anything, it probably was a good choice.

If you have student loan debt and it doesn’t seem to fit the bill of “good debt” (and you are a pf blogger or reader), you probably are paying it off quickly if you can (go FB!). If you have “good” student loan debt, such as Well-Heeled’s zero precent interest, forever loan, you probably are not (unless you do it for the emotional payoff, which is fair). Mine is more good than bad, but not as good as others. It is at 4.5% (tax-deductible) for about $20k, commanding me almost $70k early on in my career (inflated due to high cost of living city), and more later. If I had extra money, I might pay it down, but I use my money for other priorities. I’m maxing out my 401k before I’ll pay extra on that loan. (It also will be at 0% from this September for about two years.)

I’ve heard anti-debt militants people argue that you should save up, pay as you go, and take extra time to graduate. That is certainly an option, for those of you that it suits. Financially, I doubt I would have come out ahead doing this (how much could I make with no degree?), and personally, it would have (to put it eloquently) sucked. It is an option, but not one that I was interested in.

Some other student loan information:

• From Get Rich Slowly, A rough guide to Student Loan repayment, guest post by me, geared towards those who just graduated and don’t know what to do (one year old). I wrote this because it is the info I wish I had the year before.
• Check out finaid.org: My favorite resource for federal loans.
• If you are considering consolidation of older variable rate Stafford loans, the rate has reset! Current rates for those longer out of school is 4.21%, and in the grace period, a nice 3.61%. Consolidate now to lock in those rates!
  
• For balance, a post on why student loans aren’t good and advocates paying as you go, even if it takes you 6 or more years.
• There are a lot of different ways to get a degree. Here is an interesting article about someone getting a technical certification to earn more while they pursue a degree.

I finally got official word that I was accepted to the graduate program I applied to! It is somewhat anti-climatic for two reasons. First, since my employer is paying I wasn’t hoping for funding and my credentials were quite strong, I sort of expected to get in. Second, several weeks ago, I asked T (who attends this school as a full time PhD student with funding) to check on the status. He found that I had been recommended for admission, so it was a waiting game, really. But a long waiting game, considering they told me I would know in 2-4 weeks in February!

What does this mean for my finances? Not a whole lot, actually. It’s a part time program, so I’ll continue to work. I’ll be really busy starting this fall, so maybe I’ll save even more! Also, I’ll be considered a half time student so my student loans will go into deferment. Since they are subsidized, the rate will be 0%. That’ll free up $141 each month for savings, but I think I’ll continue to put $70 into my student loan payoff account. (This month, only $65 of my $141 payment went to principal!)

Long term, a M.S. degree in my field translates to roughly $10k-$15k more than a B.S. with similar experience. It’ll increase my expertise and help me advance more quickly. It’ll open more doors to have a top school on my resume. I also get some sort of stock options when I complete it, but they vest slowly, so I can’t count on that. I already have 9 credits at a lesser (top 50) institution, so I should finish in less than two years if they accept 6 credits.

T thinks I should take the next step and apply for a full time Ph.D for Fall 2009. I don’t even really want to go for my Ph.D., but I’m laid off in January and the economy is still poor, it is a reasonable back-up plan. Obviously, I wouldn’t go without funding. I know that graduate school should be a passion, not a back up plan, so I’m hesitant. While I may be able to pull off a Ph.D. acceptance, I’m less confident that I could pull off funding at this particular university. My previous graduate university offered me funding for my M.S., which is unusual, so there is a chance. However, the competition is extremely stiff at this level.

I suppose I have until fall to think about it. I have my GRE’s, my professors have electronic letters of recommendation that could be revived easily. No need to decide today.

Instead I’ll relish in my acceptance and enjoy my summer before my free time dwindles to zero!

P.S. - If I hadn’t banned myself from the grocery store, I would make Fettuccine with red pepper feta sauce, complete with homemade whole wheat pasta. The only ingredients I’m missing are chicken stock, eggs, and red peppers. It sounds like a meal T would enjoy as much as I would. He sometimes thinks my ideas of a good recipe to try are odd. I suppose it can wait a few weekends!

P.P.S - Sorry if all the food talk is too much. I am not talented enough to start a food blog, so I just sneak my food thoughts into my personal finance blog!

I have been learning how to sail! I have some pipe dreams of cruising around the world on a sailboat, though at this point in my life, that isn’t really an option. I don’t spend a lot of money on entertainment, going out, or gym memberships, so I selected sailing as my newest hobby. It is a bit more expensive than I anticipated, but to be honest, I didn’t think much about it. It sounded fun, so I signed up.

First there are the lessons. They cost $385, but I was able to pay about $150 instead of full price. This includes 3 lectures of 3 hours each, and six on the water days of 3+ hours each. I can now take the second round, which is the same price but more advanced topics. There are also some fees to get “certified”, which I was not originally aware of.  It is about $95 for a written exam and on the water exam, plus another $30 or so for a log book. I think there is one of these certifications for each of the first 2 classes, so I’d have to pay the fees two times. If I want to go further, the next step would be $445 (!) for a weekend trip that certifies me to charter my own boat.

Then there is the “gear”. I didn’t go overboard and buy a bunch of actual sailing gear, but I did purchase a $50 windbreaker, $20 sunglasses, and $20 white soled deck shoes. I could have just wore regular sneakers, but mine had black soles. If I were to get really into sailing, I might have to get “foul weather gear” but I haven’t found the need.

Between the classes and the gear (mainly the classes) I could easily spend $1000 this year learning how to sail. Then what? What am I going to do with my knowledge? T is going to take the class I just took, and we could take boats on little trips around here. However, sailing seems to be expensive and time consuming and neither one of us has a lot of time or money right now. Purchasing a sail boat is only realistic if I intend to live on it, which sounds a bit romantic but is a little to extreme for this point in my life.

I can’t afford to regularly rent boats, I really can’t afford to go out and buy a boat. Is sailing a wealthy person’s hobby? It seems like there is a mix of wealthy people and people who are free spirited. My sailing teacher has given up his life in the “rat race”, as he said. After spending a year cruising with his family, he has taken to making a living by writing on the weekdays and teaching sailing on the weekends. Not a bad life, if I don’t say so myself. (This is helped by the fact he sold a home in the L.A. area at the peak of the real estate bubble. I wish I did that.)

I don’t know what to do from here. I could continue taking classes, but I have no real goal for my sailing hobby, other than fun. It is apparent I won’t be buying a yacht or chartering a cruise to South America anytime soon. I could call my $200 spent so far a fun entertainment/educational expense, and put my sailing career on hold. I could pay $150 more for another session of six lessons. I could pay another $200 on top of that to get fully certified. But for what purpose? I can afford to learn to sail, but I can’t afford to sail on a regular basis after that. It would be kind of like how T, two summers ago when making decent money, learned how to fly private small planes for perhaps $3000 or so. He loved it, but he hasn’t been up in over a year because it is too expensive for a grad student to keep up. (I hated it. I got airsick and small planes are actually pretty dangerous.)

After moving and putting my degree on hold, I found myself with a lot more free time than I was used to, so learning to sail was one thing I chose to explore. Next fall, I’m going to be continuing my M.S. degree and I won’t have time for these hobbies. I still have a whole summer left to explore other interests, and now is the time to decide if I want to continue sailing or spend my time doing something else.

I signed up for a free class offered by a local university through my workplace. The class is about office politics and was brought in by the women’s leadership group. Being one month into my job, I’m not in a leadership role, nor do I have a short term goal to be there (or long term, for that matter). Still, I had a lot of reasons for signing up.

• I am addicted to learning and can’t start my “real” technical classes until fall.
• Office politics? I’m young and I’m more technical than political, so I figured it would be good to expand my horizons
• A chance to network with other women in a male dominated company
• Something to keep me busy and get me more involved in my company
• Might look good on a development plan
• 100% free to me–Never turn down free education!

I got to the class on time and took a seat at a table with a couple other women. By the time the class filled up, I noticed I was at a table with women in their 40s or older, while the table to my left had several people closer to my age. I thought, “drat. I wanted to meet some people my own age. I sure picked the wrong table.” Halfway through class I changed my mind. As a young employee, the best thing I can do is network with those who have more experience. My table seemed somewhat amused by my presence, and called it “cute” that I had signed up for the class even though I’ve only been here a month. I could take offense at the use of “cute”, but I laughed about it instead. See how cute they think I am when I politic my way up to CEO! Kidding…

We had one naive young lady who asked, incredulously, “Wait, so you mean to say that people aren’t promoted just on the basis of their hard work and talent? I find that really disturbing.” I found it surprising that anyone still believes that. Of course, hard work is quite important, as is talent, but there is more to your career than that. You don’t have to like office politics, nor do you have to play them, but at the bare minimum you should be aware of them.

It is a four session class with 3 hours in each session. We got a binder of class materials and a book. You know you have been spending too much time thinking about personal finance when you think to yourself “Sweet, free book! I wonder if I could sell it on Amazon…” (yes, for about $2) . Also, there was free snacks that counted for most of my dinner.

After this class, I plan to start a sailing class in April. Then I’m going to try to figure out if I can find a way to pay for a surfing class.   Once I do continue on with my Masters program, I’ll have no time to pursue these California hobbies.

RacerX and Single Ma both say they won’t (at least not 100%). Shuchong argues that her parents paid for hers and figures it was a good investment for the doors it has opened in her life. I find the whole debate a bit perplexing. It implies that most people have the choice, which I don’t think is the case. Trent makes some points on why you shouldn’t pay, but the only one that holds up as a rule is that it is a burden on the parents. Most parents will help their kids to the best of their ability, and if parents can’t afford to, what is there to argue about? What are we really debating?

Paying for your kids college will no doubt give them an edge in the early stages of their life, and maybe beyond. I find that is difficult to argue. If you take two identical high school senior and pay for Student A’s education at the best school he can get into, and send Student B on his own, in most cases Student A will come out ahead.

But who cares? We’re never talking about two identical students, but individual students with unique talents, goals, and personalities. I want to emphasize that kids can be quite successful in life even if parents “choose not to” (can’t afford to) foot the bill.

Here are my tips on how to make college affordable and still be able to compete with those who had an advantage. These tips are geared at those students who, given different financial circumstances, might have found themselves at a top school. These thoughts are not new, but I want to emphasize that they really do work and won’t put you at a huge disadvantage in life.

Scholarships/Financial Aid
This is obvious. Apply for all the scholarships you can, fill out the FAFSA, and with any luck, you won’t need to do any thing else on this list! However, don’t be fooled–it isn’t as easy as it sounds. Most students will get some help, but few will get everything provided.

Get a job while in college
Working full time is not ideal–school really does have to come first. However, in my part time jobs I never had a problem getting off of work when I needed to study. I hate hearing “my parents really wanted me to focus on school and be involved on campus, so I didn’t work.” My parents also wanted those things for me, yet I still had jobs throughout college and had a great experience. You can “do it all”, so to speak.

Very few kids who didn’t work spent more time studying than I did. For the most part, they just spent more time relaxing and goofing off with friends (which may have it’s benefits, but doesn’t further education/career. You can still “network” without having excess free time.) The worst cases simply spent a lot of time partying or smoking pot.

After the jobs related to my major, waitressing was a the best college job I had. The most money could be made on Friday or Saturday nights, and you would be done in time to go out with friends. Even if you havea job, make time to be involved in campus activities. Even if you are an officer in an organization, being involved on campus isn’t that time consuming. As an added bonus, you can add a nice bullet on your resume: “Maintained a [X] GPA while working 20 hours a week.”

Take Out Student Loans
I’m also tired of “I’m so thankful I’m not burdened with debt”. My $133/mo really is not burdening me, especially when I think of the opportunities it provides me. Don’t be scared of loans, but don’t be careless with them either. You have to be smart about this, but student loans can be a good tool. It is silly to go into a bunch of debt to get a degree that won’t earn you much money. However, it is equally silly to forgo a low interest loan (especially subsidized) if you’ll have a strong earning potential once you graduate.

Pick a marketable major
There is something to be said for studying what you love, but understand the implications. I am not arguing that the world doesn’t need majors in comparative literature. However, studying something that has lower earning potential is a luxury. If you can get scholarships to do this, wonderful! If your parents are footing the bill, great! Have fun! Just don’t go $120k into debt to become a pastry chef (true story, saw it on Suze Orman). You’ll regret it, even if you love baking. (I do love math/science, but not everyone is a nerd like me.)

This isn’t to say you are limited to majors that lead directly to a lucrative career. If you are majoring in something impractical (or actually, anything) have a plan and be able to justify any money spent on that degree. Truly loving what you do can be justification enough, as long as you can afford to pay back any debt you incur.

Don’t go to a “brand name” school (unless financial aid makes it worth it)
I am going to admit it–a good school helps your resume for your first job. I doubt my current job would not have hired me based on my college resume, solely because my undergrad school is unrecognizable outside of the region. However, I’m less than two years out of school and working primarily with people whose college educations cost a lot more money than mine did (and getting an M.S. at top university fully paid for).

Without a brand name school, good grades are especially important. If you have mediocre grades at a mediocre school, you won’t stand out. If you are a bright student at a mediocre school, take advantage of it. Get high marks and get to know your professors. They might be able to hook you up with a grading or TA job, or they may have connections in industry. Be involved on campus, become an officer, and be an outstanding well rounded student.

After college, get your first job at the best company that recruits at your school. Do well in it, get some good experience. Perhaps you’ll find you really like your job and you are well paid, so no need to move on. If not, with a little experience you will have a good chance of getting in to any company you want to work for.

Bottom Line
Kids whose parents pay for college (especially fancy ones) simply do not have to be as motivated and outstanding those who are on their own. I’m not saying that they aren’t (there are many talented and motivated students everywhere). However, average (and below average) students at those schools will likely do better than equally talented students elsewhere simply because of the parental advantage. Doors will be opened for them more easily, but you can open your own doors. If you are committed, hardworking, motivated, and have some sort of aptitude in something, you should be able to do just as well, even without your parents financial support.

What I’ll do for my kids
I’m not sure yet. I’ll help them to the best of my ability if they show the motivation and aptitude for college. If I can’t afford much, I’ll help them in ways my parents did–encouragement and support. I’ll also help them in ways my parents didn’t (because they didn’t know). I’ll be sure they apply for every scholarship they are eligible for. (I would have qualified for free tuition based on my ACT score had I taken them in the right month!) I’ll have solid advice about the admissions process and show them outstanding schools that provide excellent financial aid. I’ll also help them navigate the financial aid office and truly understand any loans they take out. They will be personal finance experts by the time they graduate high school! And I’ll tell them everything I just wrote here (provided it still applies when my theoretical unborn children go to college!)

Problem: I’ve been a wreck lately, off and on. In less then 3 weeks on the job, I have twice called T at lunch in tears over nothing! Of course, I know that it is over nothing, even when I call. Of course, I’m professional enough to keep my tears out of sight of anyone. Still, it is frustrating. To me, and maybe to him, though he’s been super kind about it.

With the relocation and all the changes all at once, I’ve really been under a ton of stress lately.  Most of it is exciting and good, but it is still stressful.

Solution: Start running again. I quit when I lived in Iowa and it got really cold

Now really, I want to try out rock climbing or yoga. But I don’t trust myself with that yet. Spending money on something I may or may not follow through with. Running is free–I have shoes, I have a road… and a workout room at my apartment. The other things, not so free. If running balances me the way it usually does, then perhaps I’ll branch out, but I have to focus on one thing at a time.

When in doubt, choose the free option.

The best advice I received about whether to pursue grad school immediately after graduation was essentially that. My dad suggested, that if I was not sure, I should think about it while I was making money rather than think about it while I was borrowing money. Such wisdom from someone so bad with their own money! There is some value in “just getting it done”, but I think more students err on the side of grad school when it isn’t their best choice than err on the side of employment when graduate work is their calling. It’s easy to do though–if you are good at school and have been going to school since you were 5, more school easily seems like the best choice.

Going to grad school part time while working full time can be a HUGE pain in the butt, but financially, you just can’t beat it (if employer covers tuition). It’ll be two more years of hard hard work, but to have an M.S. degree when I finish? It’ll be fantastic. I mean, kids (and even pets) probably will have to wait, but I’ll be (gasp) 27 or 28, which isn’t all that old. I have a good friend who is due to have a beautiful little girl any second now, but that really was never the image I had of my life. I won’t be the youngest coolest mom, but I’m cool with that (and really, I still get carded for R rated movies sometimes so at least I’ll look young).

Anyway, I find out about my acceptance to the new graduate program applied for “within 2 to 4 weeks” of either today or the day that I submitted the application (the email wasn’t clear). Cross your fingers!

I think I mentioned I’m re-applying to graduate school. I have 9/30 credits completed (through distance education while working) at “University A”, in the state I formerly lived in. I could continue on this path, taking 3 credits a semester (6 a year) and graduate in 3.5 years. University A is usually ranked in the 30s or 40s in my field.

My new job is more flexible about where you do your education.  I now have access to another (distance education) program at “University B” a top 10 university in my field.  Even better, they are on the quarter system, require just nine courses, and I can take four each year. They also will accept two transfer credits, meaning if they accept my application, I’ll be done in under two years! It’ll also be a boost to my resume, as I went to a relatively no-name undergrad university. It also probably will be a lot more work and a very difficult two years… but it should pay off big time in the long run.

I was already really sold on this idea but I just came up with yet another great benefit. At “University B”, each class is four credits, which by their system would classify me as a “half time” student. So what does that mean? Well, my student loans are Federal Subsidized Stafford loans, meaning while I’m enrolled in school at least half time, the government will pay the interest for me. I could also completely cease making payments if I wanted, freeing up $133 extra each month to invest/save. WOW! (I’ll have to decide exactly what I plan to do when/if this whole thing is a reality)

In dollar terms, what does this mean? Well, last month the interest on my loan was roughly $75, so if I’m in this program for roughly two years, it’ll save me about $1800. I can’t wait until September to get this started! Let’s hope that they accept me! I should find out within a few months!

I consider myself reasonably successful, and I hope to continue down the road to success as I get older. Trent over at the The Simple Dollar recently wrote an interesting post in which he shares some tips to improve your life. In light of this, I want to share with you exactly how I got to where I am today, and outline how you can do even better than I did! Here are the main four things I did right to get where I am today:

Luck: I was born in the USA, lucky me! I think that is the single most important thing to my success (though other first world countries could have been acceptable).

Family: We were not in poverty, though there were some money issues at times. That helps a heck of a lot when trying to get through life. I was well fed and even went to a private high school. Most of all, there was a ton of emotional support. My dad in particular placed high priority on education, as he did not finish college himself. We were encouraged to participate in extra-curricular activities, and my parents shelled out for a lot of lessons, sports and extra classes. I used to go to summer school for fun to take extra classes in math, English, art, or whatever else.  My parents also provided some minor monetary support in college, and allowed me to stay at home rent free while for a couple semesters.

Natural ability: Not everyone can get through the hard science coursework with good grades. I’m not meaning to be arrogant–there are a ton of things that I stink at. However, my ability to understand math is genetic–I did nothing special to earn it.

Hard work: I have spent many many hours investing in my education and myself. It isn’t always fun, but it is rewarding.

To a lesser degree, the following two things helped:

Federal Support: I received scholarships and financial aid to attend college. Without it, I’d be at least 20k more in student loan debt. For a state school!

Social connections: I got the interview for my current job because my boyfriend was going to a top grad school, met someone who worked here, and passed on my resume. Most people who work here are from big name schools. Not I! Other than that, I haven’t got a lot of advantages from social connections yet. My parents don’t have powerful friends, nor did I go to a prestigious school. However, this can be a huge factor.

Based in my successes, I have three surefire tips for success. You’ll may have to combine these with hard work to guarantee success. Still, with just a little work, you’ll have a good shot at a successful life if you do these three things:

1. Be born in a good country. Even better, pick a good neighborhood, and maybe consider avoiding being a minority group. You could even consider being male, though I wasn’t and don’t want to be!
2. Have a good family. The more money the easier it will be for you, but even more importantly, they have to care about you. Not only that, they must have the time and knowledge to invest in your future, as well as the ability to lead you along in your early years (and maybe in your young adult years too, if you are lucky).
3. Be gifted. Intelligence is a good gift to have, or perhaps extreme artistic talent. Both would be great, but there are some other options I’m sure. Have some charisma and a go-getter personality.  Be super talented at sports (and also highly disciplined).  While you are at it, make sure you are healthy and it wouldn’t hurt to be attractive too.

What, you don’t like my advice? Okay, okay… Then I suggest you read Trent’s good advice that can actually be followed, no matter what has happened with my three tips!

All joking aside, hard work is very important and can help a lot of people. What about “working smart”? Personally, that term gets on my nerves. I think it is overused and largely meaningless. However, if you think you can find a way to “work smart”, go for it. If you don’t really understand what “work smart” means in your life (I don’t!) just work hard while you are contemplating it.

My point is, you do have to play your cards right, but it is silly to pretend we all got a similar hand.

I just completed my first week at my new job, and will get paid next week. Let me just stay, I can not wait!

Work, so far, is horribly boring. I know it will get better, but they haven’t exactly fit me into a program, so I’ve just been chillin’ and doing a LOT of online training. But I’m a hard worker, so it is frustrating to just be sitting here, when I know all my friends at my last job are working their butts off.

By the way, applying to graduate school is expensive. I was accepted to a pretty good school at my last job (usually ranked about 30 or so in my major), but I now have access to a degree from top ten university. They will accept 2 of the 3 classes I have taken, and are on a quarter system, so I will be done with my M.S. degree more quickly. It will be a lot of work, but a better education overall. It will also help my resume out, as my undergrad institution is relatively unknown. My current company will pay for pretty much everything, including books.

In order to apply to the new school, I have paid:
-$60 application fee
-$24 for 2 transcripts from my previous grad school
-$12 for 2 transcripts from my undergrad school

I have opted NOT to send transcripts from my study abroad university (too much of a hassle, probably only about $15 plus international mail) and not order official GRE scores ($20 or so). Still, it is easily $100 a school to apply!

They will eventually be reimbursed to me, as long as I remember to file for it once I’ve completed my first class. My fees for the previous school I applied for were also reimbursed (and the GRE fee), so I am fortunate. But had I gone to grad school right away, I’d be facing these costs as a poor college student. That just seems wrong, but there aren’t many ways around it.

This is one of many reasons I am really excited for my paycheck. Thank goodness for a healthy savings account!

In my industry, tuition reimbursement is pretty common. My current job has it, and my new job actually pays the tuition up front for you.

The problem I’ve run into is that Spring semester starts next week, and I am still finalizing my start date for my new job (most likely, February 1st). There is a class I’d really like to take this semester, but I don’t want to pay for it out of my own pocket. I’ve been trying to get an answer from my new job about whether they will pay the bill for me (even some prorated ammount), or if I have to take a semester off from my distance learning program.

The cost for one class would be rough $1600. I could take this out of savings. Why would I do this, when employers typically pay for this cost? Well, I might do it in hopes that I can work something out with my new manager and get them to reimburse it. I might do it because the class sounds interesting and isn’t offered often. I might do it so it won’t take me even longer to finish my degree program. Since I have been unable to get an answer from the new job, I have seriously been contemplating paying for it out of pocket.

When it comes down to it though, $1600 is just too much money for me to spend. Here’s to hoping they get me an answer soon!

In other news, I purhcased my rental insurance from Geico last night, with a 5k deductable. The reason I’m getting rental insurance, despite the fact that the value of the things in my apartment is probably less than the deductable, is the liability issues. The general rule (for me at least) is to insure yourself against thigns you can’t afford to have happen. If my apartment burned down, I could afford to replace my belongings. That is why I have an e-fund. The policy also has some sort of “temporary living” terms that would help me out. What I couldn’t afford is if my apartment burned down and it was blamed on me and I was sued for damages. I chose a high deductable, but also high “liability” coverage. It was only $163 for the year, and it was close to $300 for a more “reasonable” deductable of $1000 or $500.

My freshman year of college, I believe I spent about $500 on college text books. Looking back, it was a foolish mistake, but I didn’t know better at the time.

My first mistake was that I assumed that when a class said a text was required, they meant it. This turned out to be not true. Sometimes it was, sometimes it wasn’t. Second, I bought books too late and there were no used ones left. Third, I didn’t check the internet to compare prices.

Really, I think the college textbook industry is a huge rip off. If you’ve ever taken a class that recently switched from, say, edition 5 to edition 6, you may have noticed that the differences in the editions was primarily in the problem sets. Some texts may have major updates, but for the most part, the facts stay the same. Often times, the problems aren’t even completely different, just altered in a minor way. How frustrating.

Not all professors played the game. One professor said that a text was required, but we could get any standard text relating to Control Systems we wanted. He pointed us to Amazon. He taught primarily from his lecture notes (and a text wasn’t truly necessary), saving me about $100 that semester.

Also, why are we only given the option of hardcover texts? My boyfriend insists he loves hardcovers because they last longer (whatever). Shouldn’t I have the option to easily purchase softcover to save some money? I did a semester in Hong Kong, and their book store didn’t contain a single hardcover text for class. Not only that, but many of the students didn’t buy the text anyway, as the professor often scanned the necessary material for the students. While that may violate some sort of copyright laws, not offering the softcover versions to US students seems unfair. In fact, I brought the two texts I bought (for a reasonable price!) in Hong Kong and sold them on Amazon in the US. I probably made a small profit, even though I priced them lower than the similar hardcover versions. Abebooks.com often offers softcover “international” versions of college texts. I used one from there for one of my graduate classes last semester.

At the end of the semester, the college bookstore offers to buy back your textbooks from you. This is another rip off. They try to tell you that buying and selling your books through the book store is “good for the college” because they donate money to various student groups. I’d much rather that they offer me a fair price for my books! If I can sell it for $70 on Amazon, and the bookstore will sell it for $90 in the store next fall, why on earth would I give it to them for $45?

I would speculate that this scam of the textbook industry trickles down to high school and elementary school, but since the books are provided for “free” (with tax money), people aren’t as aware of it. I went to a private school and we had to buy our own textbooks. Rather than the bookstore running a scam to make profits off of used books, each family would put an envelop with a price inside the book they were offering to sell. The students formed a big line (I think you got a place according to a raffle number) and you would pick the books you wanted to buy. You’d pay the amount listed on the envelope, which was later given to the parent. Unless a class was switching editions, you could come out about even every year.

In later years of college, you could sometimes do a similar thing with classmates a semester ahead of you. These days, with facebook and other social networking sites hooking up buyers and sellers more easily, I wonder if anyone still shops at the bookstore.