Aaron Valenzuela got his first credit card when he was 18, the summer
before leaving for college. Three years and $4,000 later, he now has five
credit cards and struggles to make his minimum payments. After he graduates
in
May, he can look forward to at least another $15,000 in student loans.
A Vassar senior, 21-year-old Valenzuela represents a growing trend that's
giving college students a harsh reality check: financial debt.
Valenzuela works part time at Vassar's computer store, but the $220 he
makes each month is barely enough to cover regular payments to his credit
card
companies. He estimates that he puts $150 each month toward his debt.
"When you have five credit cards with maxed out balances, it's difficult
to make five different payments and still have money to live on," he said.
"Since I make the minimum monthly payments, 90 to 95 percent of what I send
is probably to pay the finance charges. My average interest rate is probably
17 percent or something ridiculous like that."
Valenzuela does not consider himself a careless spender. Unlike many
other
students, he receives little support from his parents, so he's forced to
cover
nearly all his own expenses. He buys plane tickets to fly home to El Paso,
Texas for breaks, clothes and food.
Where did it go?
"Sometimes I'll buy stuff that I don't really need," he admitted. "But
most of the time, I look at my bills and wonder, `Where did I spend all this
money?' "
The upshot for Valenzuela and other students in similar situations is
that
a number of resources are available for dealing with debt.
Most schools, including the counseling services at Vassar and the
financial
aid office at Dutchess Community College, offer personal consultation for
students facing financial difficulty.
"We try, as part of (the students') financial aid, to help them limit
debt," said Susan Mead, director of financial aid at DCC. "We analyze
their
curriculum, type of position and salary. We gauge debt based on that, and
show
them how to estimate what they can afford."
Average debt: $18,000
Considering that the average college student graduates with $18,000 in
loans, according to the U.S. Department of Education, it's important to be
aware of the ins and outs of financial aid.
College Financial Aid Advisors, a Kingston-based company which aims to
inform and assist students with the financial aid process from start to
finish, begins educating students early -- while they're still in high
school.
The company hosts financial aid "boot camps" at local high schools and
colleges.
"There are a lot of colleges that have financial aid officers who will
sit
down and answer questions," said Bill Losey, president and founder of CFAA.
"There's also a lot of information on the Web, but there's so much
mis-information that parents and students don't know what's correct."
"(Students) see the here and now, but they don't see tomorrow," said
Mead. "Unfortunately, that's indicative in a lot of people. Students can't
afford to make these loan payments."
Valenzuela's student loans are subsidized by the federal government, so
he
won't have to deal with beginning to pay them off until six months after
graduation. In the meantime, however, he faces the hardship of living as a
student in debt.
"If I dwell on (my credit card debt), it's really frustrating because I
know I created the problem myself," said Valenzuela. "It can be almost
depressing, but I just don't think about it; I focus on academics and try to
not get caught up in it."
