This sums up how I feel about student loan forgiveness

[JustFillIt]

Then ppl will jump to college just bc they want to borrow money to buy cars, stocks or houses.

Do people buy stocks with student loan money? This would be super stupid (I’m my opinion) unless you are some sort of stock trading guru..

You would have to have a 10-15% return yearly to make it worth it... this is not a reasonable expectation from the stock market...

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[deleted898085]

I tune into CNN when I look for meme-able content, lib media is as big a joke as Fox

CNN is biased but has less fake news than Fox.
NYT is better alternative to CNN.
What's the alternative to Fox Cable? Breitbart?

 

[deleted898085]

Do people buy stocks with student loan money? This would be super stupid (I’m my opinion) unless you are some sort of stock trading guru..

You would have to have a 10-15% return yearly to make it worth it... this is not a reasonable expectation from the stock market...

Yes it is stupid if they don't know much about stocks.
But I was talking about zero interest rate, or maybe 5% but not 7%.

 

[PharmtoCS]

Do people buy stocks with student loan money? This would be super stupid (I’m my opinion) unless you are some sort of stock trading guru..

You would have to have a 10-15% return yearly to make it worth it... this is not a reasonable expectation from the stock market...

I have read stories on students using their financial aid to buy Bitcoin.

 

[BMBiology]

Both sides are dancing around the 500 lbs elephants in the room. People should have the right to an affordable college education. People should have compulsory financial management education in public schools. We are failing miserably on a societal level.

I used to think financial education is the key but it’s not. You can easily find common sense financial advise on YouTube nowadays so access to financial education is no longer a barrier.

The problem is...the vast majority of poor people just can’t delay gratification. They know they should save but they just need to have that new phone or take that fancy vacation so they can post pictures on instagram. So, they overspent. They put it on their credit card. That is how they get in trouble but it is not because they are ignorant but because they just refuse to make sacrifice.

 

[mentos]

Do people buy stocks with student loan money? This would be super stupid (I’m my opinion) unless you are some sort of stock trading guru..

You would have to have a 10-15% return yearly to make it worth it... this is not a reasonable expectation from the stock market...

They spend it on anything they want. Vacations, cars, clothes, rent, furniture.





There is no regulation at all. The government hands out checks like candy.

 

[JustFillIt]

I used to think financial education is the key but it’s not. You can easily find common sense financial advise on YouTube nowadays so access to financial education is no longer a barrier.

The problem is...the vast majority of poor people just can’t delay gratification. They know they should save but they just need to have that new phone or take that fancy vacation so they can post pictures on instagram. So, they overspent. They put it on their credit card. That is how they get in trouble but it is not because they are ignorant but because they just refuse to make sacrifice.

Yea... I think this is the root of the problem....

The only thing that frustrates me about delayed financial gratification - In this day and age - is that there is too much uncertainty in so many ways. There really is something to be said about responsibly enjoying your “harvest” in the now.

But, every responsible American should be seeking home ownership and contributing to a professionally managed 401k for the majority of their working life, in my opinion. Outside of that, if you want to live paycheck to paycheck that is your business as long as you are being responsible (not overspending with credit cards)

 

[confettiflyer]

Slightly off topic but tangentially related...

Dealerships give car buyers some advice: Just stop paying your loan — The Wall Street Journal

The vehicle trade-in is often a crucial step in car buying. But some dealerships are telling buyers to give their old cars back to their lenders—and selling them new ones—in a practice known as “kicking the trade.”

apple.news

Article headline and lead text:
“Dealerships Give Car Buyers Some Advice: Just Stop Paying Your Loan”

Car sellers are telling hard-up borrowers to have their old cars voluntarily repossessed. Lenders and borrowers are losing out.


Sent from my iPhone using SDN

 

[redfish955]

Yea... I think this is the root of the problem....

The only thing that frustrates me about delayed financial gratification - In this day and age - is that there is too much uncertainty in so many ways. There really is something to be said about responsibly enjoying your “harvest” in the now.

But, every responsible American should be seeking home ownership and contributing to a professionally managed 401k for the majority of their working life, in my opinion. Outside of that, if you want to live paycheck to paycheck that is your business as long as you are being responsible (not overspending with credit cards)

What would be your thought if you could declare chapter seven and the only thing not forgiven was tuition?

 

[zelman]

Then they should just shut up and start working. When should the illiterate command the country as leaders?

When they beat Hillary thanks to the electoral college.

 

[deleted898085]

When they beat Hillary thanks to the electoral college.

Now I understand his satire. Hahaha
Slow me!

 

[wagrxm2000]

Do you really believe that the cause of poverty is the inability to delay gratification and make sacrifices, or are you just trolling?

It's actually a person's inability to trust themself and take a risk to improve their life.

My techs talk about going to school all the time..... Then later talk about random payments they are struggling with as they drink their $6 Starbucks.

(I have no clue have much Starbucks costs, never went there)

 

[wagrxm2000]

Let's be real - poverty is multi-factorial and there isn't just one reason why the "vast majority of poor people" are poor. Blaming poverty on individual character flaws is an oversimplification at best, and a harmful misrepresentation of poor people at worst.

So why don't my techs change their lives?

What is stopping them?

 

[BMBiology]

Let's be real - poverty is multi-factorial and there isn't just one reason why the "vast majority of poor people" are poor. Blaming poverty on individual character flaws is an oversimplification at best, and a harmful misrepresentation of poor people at worst.

Have you ever been poor? I was raised in a poor family. A lot of my relatives are still poor. How did I make it out?

 

[wagrxm2000]

I don't know your techs. My best guess is lack of mentorship and nonjudgmental support from their boss.

Tell that to my old tech that's now a lawyer.

 

[wagrxm2000]

We can talk about anecdotes all night, but you made a claim about the vast majority of poor people.

I know plenty of individuals who were able to break out of the cycle of poverty their families were stuck in. There are two major themes among the poor people I know who escaped poverty: 1) they were able to marry someone in a higher class than them or 2) they were healthy and stable enough to join the military. Sure, being able to "delay gratification" and "make sacrifices" helped them along the way, but that's not the reason they were poor to begin with, and that alone is not what got them out of poverty.

Why do you believe a person in poverty can't get out? Outside of the children excuse.

 

[wagrxm2000]

debt, unemployment, poor education, hunger, mental health issues, medical issues, catastrophic loss and displacement as a result of natural disasters...

Ok so what is your explanation for my techs?

Go to any establishment that pays around mininun wage. What's the excuse there?

These are the people I'm talking about where there is not a single reason they couldn't improve their lives. It all comes down to what I originally said. They don't believe in themself.

While you are stuck on your reasons. There are plenty of capable people that don't fit your mold.

 

[BMBiology]

We can talk about anecdotes all night, but you made a claim about the vast majority of poor people.

I know plenty of individuals who were able to break out of the cycle of poverty their families were stuck in. There are two major themes among the poor people I know who escaped poverty: 1) they were able to marry someone in a higher class than them or 2) they were healthy and stable enough to join the military. Sure, being able to "delay gratification" and "make sacrifices" helped them along the way, but that's not the reason they were poor to begin with, and that alone is not what got them out of poverty.

There is a lot of research done this:

“Benefits of Delayed Gratification

Studies show that delayed gratification is one of the most effective personal traits of successful people. People who learn how to manage their need to be satisfied in the moment thrive more in their careers, relationships, health, and finances than people who give in to it.”

The Benefits of Delaying Gratification

Are you avoiding pain or living with purpose?

www.google.com

 

[BMBiology]

“40 Years of Stanford Research Found That People With This One Quality Are More Likely to Succeed

In the 1960s, a Stanford professor named Walter Mischel began conducting a series of important psychological studies.

During his experiments, Mischel and his team tested hundreds of children — most of them around the ages of 4 and 5 years old — and revealed what is now believed to be one of the most important characteristics for success in health, work, and life.”

40 Years of Stanford Research Found That People With This One Quality Are More Likely to Succeed

40 years of Stanford research revealed the impact delayed gratification can have on our success in life. Read this article to learn the surprising results.

jamesclear.com

 

[wagrxm2000]

Again, I don't know your techs and their individual circumstances, so I am not going to make any definitive statement about them. Your techs do not represent the vast majority of poor people.

See and that's your issue. You ignore the capable people because it doesn't fit your position.

I agree 100% there are millions that are poor that fit into your mold.

I'm not talking about them. I'm talking about the ones that just need pushed but don't want to take the risk.

I would say a high majority of technicians at Walgreens need just a little motivation.

 

[BMBiology]

This article doesn't provide any evidence that instant gratification is the cause of poverty among the vast majority of poor people.

40 years of research you fool.

 

[wagrxm2000]

That's fine if you think some people are stuck at minimum wage jobs because they don't believe in themselves. I'll buy that. But the vast majority of poor people aren't poor because they simply don't believe in themselves.

Not some, millions.

 

[Momus]

I have read stories on students using their financial aid to buy Bitcoin.

Haven't you heard the trend? Dump it all and buy SPCE and MSFT call. That $8M lotto is just on the horizon.

 

[Lubeckd]

There is a lot of research done this:

“Benefits of Delayed Gratification

Studies show that delayed gratification is one of the most effective personal traits of successful people. People who learn how to manage their need to be satisfied in the moment thrive more in their careers, relationships, health, and finances than people who give in to it.”

The Benefits of Delaying Gratification

Are you avoiding pain or living with purpose?

www.google.com

You got to sacrifice. And pay the ultimate price...

 

[deleted898085]

We can talk about anecdotes all night, but you made a claim about the vast majority of poor people.

I know plenty of individuals who were able to break out of the cycle of poverty their families were stuck in. There are two major themes among the poor people I know who escaped poverty: 1) they were able to marry someone in a higher class than them or 2) they were healthy and stable enough to join the military. Sure, being able to "delay gratification" and "make sacrifices" helped them along the way, but that's not the reason they were poor to begin with, and that alone is not what got them out of poverty.

I thought ppl got out of poverty by education. I know most ppl can't study and earn a good degree but when one can, they can get out of poverty. Or is it because I'm an immigrant so that's all I can see?
I know some ppl can't see beyond their scope.

Also, what's the definition of poverty in the US? Poverty line for one person is about $12,800. To have medicaid, the limit is $17,600. Is that the definition?

 

[JustFillIt]

What would be your thought if you could declare chapter seven and the only thing not forgiven was tuition?

Well... a lot of people do this. This will run up a very high credit score, then over the course of a few years groom a few 25k plus credit limits. Then when the time is right spend it all on whatever and declare bankruptcy the following year..

My thought in this is it’s a disgusting thing to do and these people deserve no respect. On the other hand large business and investment groups do this all the time with leveraged buyouts on a grand scale... so I dunno - some part of me wonders if the “lowly consumer” like us should take advantage of these laws like the rest of the world.

 

[WVUPharm2007]

I used to think financial education is the key but it’s not. You can easily find common sense financial advise on YouTube nowadays so access to financial education is no longer a barrier.

The problem is...the vast majority of poor people just can’t delay gratification. They know they should save but they just need to have that new phone or take that fancy vacation so they can post pictures on instagram. So, they overspent. They put it on their credit card. That is how they get in trouble but it is not because they are ignorant but because they just refuse to make sacrifice.

I think you overestimate both the general interest people have in financial literacy AND underestimate the power of the litany of competing get rich quick nonsense that have forced people to have a bull**** filter that makes legitimate wealth building seem like an infomercial scam. I've personally redirected the lives of about 6 people close to me by explaining how 401ks, compound interest, etc work. It is true that a lot of people don't have the impulse control to not spend all of their money. But more people than you think are just ignorant to how it works. I've seen it first hand.

 

[wagrxm2000]

Sadly I've only had a few techs ever autocontribute to their 401k.

While I know it's a lot for many, $50 matched for a 40 year career will give you $250k at age 65. Toss that $10k a year on top of your social security will greatly help.

 

[BMBiology]

I think you overestimate both the general interest people have in financial literacy AND underestimate the power of the litany of competing get rich quick nonsense that have forced people to have a bull**** filter that makes legitimate wealth building seem like an infomercial scam. I've personally redirected the lives of about 6 people close to me by explaining how 401ks, compound interest, etc work. It is true that a lot of people don't have the impulse control to not spend all of their money. But more people than you think are just ignorant to how it works. I've seen it first hand.

Unfortunately, studies show financial literacy does not help the poor:

“Governments around the world have invested huge resources in initiatives aimed at improving financial literacy, such as the Federal Deposit Insurance Corp.’s My Smart program, which helps low-income individuals develop financial skills.

Unfortunately, research into the effectiveness of these programs paints a grim picture. A recent meta-analysis looked at every known study examining whether a financial-education intervention — such as training sessions, classes or one-on-one counseling — improves positive financial behaviors and financial health. Across all those studies, there was almost no benefit. Those participating in financial education were essentially no better off.”

Teaching people about money doesn’t seem to make them any smarter about money – here’s what might

Financial decision making is hard, but three promising ideas are helping Americans overcome common barriers.

www.google.com

 

[wagrxm2000]

There is a reason why we have social security....

 

[JustFillIt]

Sadly I've only had a few techs ever autocontribute to their 401k.

While I know it's a lot for many, $50 matched for a 40 year career will give you $250k at age 65. Toss that $10k a year on top of your social security will greatly help.

It is good that you are sad for them.. I wonder what they would do without someone as mighty as you feeling so bad for them...

 

[BMBiology]

This is what I propose:

1) instead of having to wait until you are 59.5 years old to cash out your 401 k without penalty, I think it should be 10 years from date of contribution. Auto enrollment into target fund so if a company matches 5%, employees would automatically contribute 5%. They can opt out if they wish. Keep 401 k as taxable income unless they cash out after 59.5 (tax incentive for long term investing).

2) increase social security contribution from 6.2% to @ least 8% over a period of 5 years for employees and employers. Allow people to start cashing out at 60 instead of 62.

 

[wagrxm2000]

It is good that you are sad for them.. I wonder what they would do without someone as mighty as you feeling so bad for them...

Huh

Sorry for caring for my staff. They are the most important people you have and should be treated well

 

[redfish955]

This is what I propose:

1) instead of having to wait until you are 59.5 years old to cash out your 401 k without penalty, I think it should be 10 years from date of contribution. Auto enrollment into target fund so if a company matches 5%, employees would automatically contribute 5%. They can opt out if they wish. Keep 401 k as taxable income unless they cash out after 59.5 (tax incentive for long term investing).

2) increase social security contribution from 6.2% to @ least 8% over a period of 5 years for employees and employers. Allow people to start cashing out at 60 instead of 62.

Due to compounding interest it's very hard to retire before you're 60. The way things are with student loans and 401k and etc you pretty much need to work until you're 60. An etf truly is the best place for any money you have. If you pull it out early you're going to be mooching off the system.

 

[radio frequency]

Unfortunately, studies show financial literacy does not help the poor:

“Governments around the world have invested huge resources in initiatives aimed at improving financial literacy, such as the Federal Deposit Insurance Corp.’s My Smart program, which helps low-income individuals develop financial skills.

Unfortunately, research into the effectiveness of these programs paints a grim picture. A recent meta-analysis looked at every known study examining whether a financial-education intervention — such as training sessions, classes or one-on-one counseling — improves positive financial behaviors and financial health. Across all those studies, there was almost no benefit. Those participating in financial education were essentially no better off.”

Teaching people about money doesn’t seem to make them any smarter about money – here’s what might

Financial decision making is hard, but three promising ideas are helping Americans overcome common barriers.

www.google.com

Having been poor at one time, part of the reason it doesn’t help is that you are currently poor in both money and likely time. I didn’t contribute to a 401k with matching at a young age, even though I was eligible. Why not? I needed those dollars for dinner. And health insurance. And tuition. Yes, it was a bad idea to not contribute in the long run. I was aware of this, but my short term needs were more pressing.

I feel very lucky I am no longer forced to make decisions that are counterproductive to my long term needs. I hope I’m not forced into that situation again.

 

[BMBiology]

Due to compounding interest it's very hard to retire before you're 60. The way things are with student loans and 401k and etc you pretty much need to work until you're 60. An etf truly is the best place for any money you have. If you pull it out early you're going to be mooching off the system.

You don’t have to retire @ 60 but by letting people start to cash out earlier, they can work less. Of course this means they are required to contribute more into social security.

I also think we should increase Medicare contribution and make Medicare eligibility at 60.

I think it is a mistake to make retirement saving an option like 401 k. It should be mandatory. If you tell a kid he has to put away his 401 k money for 40 years then of course he is not likely to do it. But, if you tell him he can start at 20 and then cash out at 30 and use the money to buy a house then that is pretty good incentive to save early.

 

[NITRAS]

You don’t have to retire @ 60 but by letting people start to cash out earlier, they can work less. Of course this means they are required to contribute more into social security.

I also think we should increase Medicare contribution and make Medicare eligibility at 60.

I think it is a mistake to make retirement saving an option like 401 k. It should be mandatory. If you tell a kid he has to put away his 401 k money for 40 years then of course he is not likely to do it. But, if you tell him he can start at 20 and then cash out at 30 and use the money to buy a house then that is pretty good incentive to save early.

But social security is a terrible investment. It has a negative rate of return yo near 1%. If you had a company that takes money from your paycheck for 30 years then gives you less money than you put it, and you'd be calling it criminal.

 

[redfish955]

In my family's personal experience, education was critical in getting and staying out of poverty (ETA: and my dad was able to access education in part because of military service). But my ability to access good education from a young age was largely due to my parents ability to secure housing in more affluent, white parts of the country where the public school system was pretty good. I was also able to value and prioritize getting an education because I was never too hungry to focus on schoolwork, and I had a lot of positive role models and people who believed in me from a young age. I was able to get tutoring for certain subjects I struggled with, and overall had a safe and supportive environment to learn in. Not everyone has access to those things, and I would not have been as successful academically if I didn't have those resources growing up.

If the vast majority of poor people are poor because they lack the ability to delay gratification, the obvious next question is why do they lack this ability? Probably because they never had a stable, reliable environment where adults or authority figures followed through on delivering promises. If society fails you over and over again, you're not going to trust that if you delay instant gratification you will be rewarded with greater gratification later on. But again, I don't think that's the main problem for the vast majority of poor people. Rather, it's lack of access to opportunities to meet basic needs (which maybe feeds into the inability to delay gratification once they are able to get to a place where they are able to meet their basic needs, but again, not the reason they were poor to begin with and had to struggle with getting out of poverty).

I know of kids whose parents are Stanford graduate engineers who struggle with basic financial concepts and understanding.

 

[BMBiology]

But social security is a terrible investment. It has a negative rate of return yo near 1%. If you had a company that takes money from your paycheck for 30 years then gives you less money than you put it, and you'd be calling it criminal.

But it is “safe”. Extra money is put in treasury bonds.

 

[deleted480308]

Honest question -- were you this frustrated when the banks got bailed out in '08 due to their recklessness?

Another question - if they allowed everyone that paid federal loans to deduct that amount in tax credits from 401k withdrawals in the future, would you consider that a satisfactory compromise?

And a question for the Bernie Bots - shouldn't we first address the root cause of expensive student loans first? Doesn't it seem ridiculous to forgive student loans when every year more and more people continue to accrue loan balances?

yes I hated the bailouts

We should just lower taxes, not try to promote more loans with tax deductions

Schools are expensive because of the huge availability of loans and govt holding them non-dischargeable. IF they were market rate and able to be discharged, banks would stop loaning so much for worthless degrees and things would correct

 

[deleted480308]

That's fine. But how do you get an educated citizenry to compete with other countries that willfully pay for post-secondary education?

let them keep the profits from their increased earnings by lowering taxes

 

[Seriously Serious]

CNN is biased but has less fake news than Fox.
NYT is better alternative to CNN.
What's the alternative to Fox Cable? Breitbart?

Lol false... didn't they just settle a 7-figure lawsuit for spreading fake news about a minor? The Babylon Bee has more credibility than CNN. I agree NYT is a better alternative. I personally use Twitter to follow multiple local channels, smaller national news channels, and individual political/economic influences.

 

[redfish955]

Let's lobby to support the luxury apartments and boutique pizza parlors that surround college campuses.

 

[redfish955]

I agree that education on its own does not guarantee one is good with finances and will be able to escape poverty.

I'll reiterate that my main argument throughout this thread is that individual character flaws (e.g., not being able to delay gratification or make personal sacrifices) is not the reason why the vast majority of poor people are poor.

I grew up on 33 cent boxes of macaroni mixed with $1 packs of hot dogs. Literally ate that stuff like five times a week. I didn't have a car until I graduated college and got a job. There were times in college in which I was working thirty hours a week while taking fifteen hours of engineering classes. There were times in college in which a 6 pack of malt liquor, a jar of peanut butter, and a loaf of bread got me through a week. Now that I'm a self made successful man people want to change the rules?

 

[wagrxm2000]

People don't seem to understand, the government is what put us in this situation in the first place.

When are people going to understand our government always makes things worse when they get involved.

 

[wagrxm2000]

I grew up on 33 cent boxes of macaroni mixed with $1 packs of hot dogs. Literally ate that stuff like five times a week. I didn't have a car until I graduated college and got a job. There were times in college in which I was working thirty hours a week while taking fifteen hours of engineering classes. There were times in college in which a 6 pack of malt liquor, a jar of peanut butter, and a loaf of bread got me through a week.

@giga is going to completely ignore this since it doesn't fit his opinion.

 

[redfish955]

I saw a ton of kids get demolished by first year engineering classes. I have no clue where they ended up. This is why I want to see 100 level classes be free.
Next like 45% of people in poverty have serious mental health issues. Let's revamp the system like Trump wants to do by allocating 5 billion for states to spend on facilities.

 

[deleted898085]

In my family's personal experience, education was critical in getting and staying out of poverty (ETA: and my dad was able to access education in part because of military service). But my ability to access good education from a young age was largely due to my parents ability to secure housing in more affluent, white parts of the country where the public school system was pretty good. I was also able to value and prioritize getting an education because I was never too hungry to focus on schoolwork, and I had a lot of positive role models and people who believed in me from a young age. I was able to get tutoring for certain subjects I struggled with, and overall had a safe and supportive environment to learn in. Not everyone has access to those things, and I would not have been as successful academically if I didn't have those resources growing up.

If the vast majority of poor people are poor because they lack the ability to delay gratification, the obvious next question is why do they lack this ability? Probably because they never had a stable, reliable environment where adults or authority figures followed through on delivering promises. If society fails you over and over again, you're not going to trust that if you delay instant gratification you will be rewarded with greater gratification later on. But again, I don't think that's the main problem for the vast majority of poor people. Rather, it's lack of access to opportunities to meet basic needs (which maybe feeds into the inability to delay gratification once they are able to get to a place where they are able to meet their basic needs, but again, not the reason they were poor to begin with and had to struggle with getting out of poverty).

I see.
I can only see ppl around me. I was a tech, earning $12/h or 24k/year. Ppl around me earn about the same. We all talk about getting more education to earn more. Some ppl make it, most ppl don't and still are at where they are.
We don't spend more than we earn. I know a lot about finance and investment and related laws bc I have someone to teach me. But I've not had any chance to use what I know. I've tried to teach my friends and coworkers a little bit but I see if you don't have a chance to practice, what's the point of learning all the theories? So they all forget about it.
I'm not sure if making 24k or less is considered poor. I lived by myself with that amount and I felt poor. Rent is already 12k, ...
I had to find a partner to make the situation better. Not everyone can find a partner though.
That's the majority of the ppl that I've met. Most of them never want to plan to have kids.

 

[deleted898085]

Lol false... didn't they just settle a 7-figure lawsuit for spreading fake news about a minor? The Babylon Bee has more credibility than CNN. I agree NYT is a better alternative. I personally use Twitter to follow multiple local channels, smaller national news channels, and individual political/economic influences.

I see that most ppl see only a few stories and then jump to conclusions!

 

[RX CARE]

Then ppl will jump to college just bc they want to borrow money to buy cars, stocks or houses.

There are always ways around that. It's not that hard to come up with deterrents to abusing the system. If we make all the loans funded directly to the institutions and do away with refunds, we can take care of that problem. It is true that the government's involvement in student loans is inherently creating inflated college costs. So why can't we come up with something like say, no institutions being eligible to participate in the federal loan program if their tuition costs are rising faster than the rate of inflation.
I'm sure there are several ideas to brainstorm and come up with fixing the issue. But I agree that an interest rate approach is much better than all out forgiveness, since it still preserves some form of responsibility for the loan. Borrowers will benefit tremendously from a little to no interest rate loan program and greatly reduce the length of time people are saddled with debt.