The Impact of Student Debt on Your Career

Student loans are incredibly common; around one in eight Americans have them. In the United States, they are one of the biggest sources of debt. On average, the typical outstanding amount of education debt is between $20,000 and $25,000, but that amount can be more or less depending on several different factors.

Around one-fifth of individuals who had student loan debt in 2017 were behind on their payments. This begs the question: How does student debt impact your career?

As it turns out, the effect can be dramatic and long-lasting, depending on your unique situation. While many people successfully pay off their debt, reach their career goals, and live relatively unaffected, there are many others whose lives continue to be shaped by their choice to take out loans.

You should consider the benefits of student loans while also weighing the potential consequences that may result from them.

1. You might need to have multiple jobs.

If anything will take time away from your career, it’s having to work more than one job. This is the reality for many people with student loan debt; they need to have multiple streams of income to be able to pay off their loans.

Many people choose to have a side hustle to make extra money, but for those with debt, it’s usually more of a necessity than it is a choice. More work means less time for enjoyable activities and a social life, which may further increase your stress and burden. However, you may find that making those sacrifices for a time is worth it, depending on your goals.

2. You may have to work outside your chosen field.

Due to obligations to student debt, you might have to work outside your chosen field to be able to make more money. Higher-paying jobs can correspond with your passions, but this isn’t always the case. It can be frustrating to not only be in debt but to also be working a job that isn’t fulfilling. You’ll want to consider how much you’ll be making once you complete your education.

You will also need to decide whether you’re willing to find a job outside your chosen field if that’s what it takes to pay back your debt. If the answer is no, you may need to rethink taking out student loans.

3. Higher education might get put on the backburner.

If you’re already in debt, you’re usually going to be less likely to want to add to it with more education. Many higher-paying jobs require you to have more than a bachelor’s degree, but it takes time and money to get there.

Those who are trying to repay loans need to be working often and may not have the time for school. As a result, it’s harder to advance in your career. The debt you acquired in the first place may feel meaningless if you still aren’t in a place to chase your dreams afterward.

4. Your passions may be ignored.

Even if your passions are strong, a lot of debt can hold you back from going after them. Usually, chasing your passions involves sacrifices, hard work, and a lot of your time.

If you can’t pay off the money you owe, you may not be in the position to focus solely on the things you’re passionate about; at the very least, debt is going to make it a lot harder. You’ll need to think about how important your dreams are to you and whether you can be okay with potentially putting them off for some time.

5. Your credit score might be impacted.

Student loans fall under installment loans, meaning they will show up on a credit report under your name. Since they are on your credit report, this also means they’ll affect your credit score.

A low credit score can lead to fewer loan options, and higher interest rates, and may even hurt you during job searches. When you’re already trying your best to pay back your debts, the last thing you want is something else to hold you back.

6. You may need to live with your parents longer.

If the amount of student loan debt you owe outweighs your annual salary, it’s very hard to get ahead. You’re not only worried about paying off your loans, but you also have to worry about rent, insurance, bills, and more.

This may prompt you to continue living at home with your parents or you might move back home if you weren’t already there. While this can be a smart option and give you the chance to finally pay off your debt, living with your parents can be difficult for both them and you.

7. Life milestones might take longer to get to.

About 81% of adults who have student loan debt said they’ve had to put off important life milestones because of their debt. Milestones could include things like buying a car or house, getting married, or having children.

For many people, taking out loans for something like education seems like a good idea. After all, you’re investing in your future. However, when that debt keeps you from moving forward in life, you may start to rethink the decision. If you’re not concerned with living on a certain timeline, this may not bother you much. However, for those who have a clear idea of when they want certain things to happen, it can be an issue.

Student loan debt may feel unavoidable, especially if you have a lot of big educational or career aspirations. However, it is something you want to think seriously about; you don’t want to jump right into it. Planning ahead is the best thing you can do to set yourself up for success.

There are an endless number of resources available on the market to help you manage your student loans, remember to make payments, save money, and create a budget. If you do research beforehand, talk with others who have taken out loans themselves, and know what you’re getting yourself into, you can save yourself a lot of time and stress.

Preparing mentally is just as important as being financially prepared, so you should prioritize both. While it may be hard to think too far into the future, you’ll thank yourself later for considering all of your potential options.

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