Many people will tell you the best way to avoid debt is to actively choose not to take any debt on.
Student loan debt, in particular, is something that burdens many of us. And the best way to avoid accumulating student loan debt is to pick an affordable institution, maintain cash flow, get scholarships, or simply, do not go. However, if your goal is to attend graduate school, particularly a PhD program, student loan debt can seem like an unavoidable reality.
This reality may seem especially true for individuals who find themselves already in debt from their undergraduate degree and preparing to apply to graduate school.
I started off with $60K in student loans
I went to a private university where I took out around $60K in student loans. About $45K were federal loans, and the remaining $15K were private loans. While I was happy to have access to loans as a financial resource, I also recognized the financial risk I was taking on each year in school.
As soon as I saw the loans on my tuition balance during my first year in college, I knew I needed a strategy to get out of debt. But I also understood that whatever strategy I chose, it had to fit my academic and professional aspirations to attend graduate school.
It was not until the start of my sophomore year that I made a breakthrough when I was accepted into a federal program called the McNair Scholars Program. This program is designed to prepare students for graduate school. Through the McNair Scholars Program, I could attend a doctoral program and receive a tuition waiver and significant stipend. This was enough to pay off my loans. All I needed to do was be competitive for an admission committee to accept me into their program.
My PhD was both an intellectual journey and a means to make my way out of debt
In preparation for applying to doctoral programs, I invested my time and energy into opportunities that would make me competitive. These were mostly undergraduate research opportunities and internships. During this time, I often had conversations with my family about the intellectual and financial benefits of getting into a doctoral program.
At the same time, as a Black man, I wanted to stay intellectually engaged with my work. I studied topics closely connected to addressing structural social issues and questions of human agency and empowerment. My financial goals had to align with a sense of purpose. And this helped to keep me honest during this financial journey.
I selected a program that was a great academically and would provide me with the most funding.
Once I felt I had enough experience to be competitive, I applied to eight doctoral programs. I was accepted into three programs with full funding (i.e., stipend and a tuition waiver). For me, selecting a program was not too difficult. I selected the program where I had a great academic fit and would receive the most funds. I selected a program that saw me as an amazing investment.
Included in my funding package was a recruitment fellowship with the option to work an additional graduate position. With this financial flexibility, I viewed my fellowship as my undergraduate loan repayment funds and savings. And I picked up a graduate position to cover my cost of living. Essentially, my doctoral program was paying for my undergraduate schooling.
I kept this financial strategy during my PhD program
And this included picking up another fellowship after my recruitment fellowship was completed. Once I graduated with my doctorate in five years, I had about $45K in federal loans left. But I also had enough savings for attacking the rest of my debt.
My doctoral degree was “free,” and I was in striking distance to eliminate all of my remaining debt. I put myself in a position to be debt-free through my doctoral studies. All while preparing myself for a career in education.
My intellectual and financial goals aligned. This allowed me to operate with a stronger sense of purpose when it came to making professional and financial decisions.
I Was Debt-Free In 10 Months
When I started a new job at a university, I went all-in on using my savings to pay off my remaining student loan debt. My initial end-game strategy was to make student loan payments with a peace of mind that I had savings.
However, after listening to Ramsey’s podcast and learning about the “baby steps” to financial peace, I pulled the trigger. I dumped the rest of my savings on my federal loans and dedicated my paychecks, to paying off the remaining amount. In 10 months, I was completely debt-free.
My approach to saving money was rather simple
I opened up a savings account specifically for storing funds from my fellowship, and every pay period from my fellowship, I would have the funds deposited into that savings account. Over the years during my doctoral studies, this savings approach, of simply depositing funds beyond the basic cost of living into a savings account, started to add up to a relatively significant amount.
The hardest part was learning to live a simpler life, even though I seemingly had a growing savings account. But I stuck to my plan to dedicate these funds paying off the rest of my loans.
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Rebuilding my savings
After I paid off my debt, I needed to rebuild my savings. I soon felt the feeling of knowing my money is my money. I could save and keep it without worrying about another student loan payment!
My story reflects how both social support and individual agency can lead to financial success. If you know someone who wants to apply to doctoral programs, let them know there is a way to accomplish their goal without worsening their student loan debt.
You can pursue a doctoral degree can make financial sense despite debt. And while not everyone will have the same opportunities, there are ways to strategize to attend a doctoral program without adding to your student loan debt.
For those of you out there with mounds of student debt stressing you out, there are always options for tackling it and methods to help you repay them. You’re never alone in your student debt journey.
This post was written by Terry Vaughan III.