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Student Loans Aren't Just for School Anymore

When facing the high cost of college tuition, some students and parents are left frantically looking for ways to pay. Imagine their delight when an answer is presented on a silver platter: student loans. Like the old hag in Hansel and Gretel, schools encourage students to take and “eat” until they are nice and fat with debt. But we all know the end of the story—and it’s no fairytale.

We asked Dave’s Facebook fans about the "fun" they've seen student loans fund, the pressure to take out thousands in loans, and why it's so easy to fall into the trap.

Go Have Some Fun!

The most surprising find was that many students are using the money to fund their own college party lifestyle.

“So many students are told to take out more [loans] than they need [for books and other things], but I saw student loans pay for more spring break trips, TVs and cars than I can count!” —Stephanie M.

“I didn’t get one [student loan], but my roommate did, and she thought it was free money. So she bought a bunch of clothes—including gifts for me and the other girls living there—and parties. The [school] counselors do make it seem like free money though, saying you can buy whatever you want with it.” —Renata M.

“I graduated 15 years ago. My school didn’t actively promote them [loans], but they certainly suggested them as a way to pay for college. I had a full ride, my active military salary and the GI Bill, so I took the student loans to buy a Corvette. I sold the car a year and a half later—I still have the loans.” —Doug M.

Here, Have Some "Free" Money

“Not only did the school that my son went to promote [student loans], but the high school he graduated from did as well. If the kids can’t afford to go, it affects their percentage of graduates that go on to [earn] college credentials. So the high school does it to boost their numbers too!” —Teri C.

“Yes, they [the lender] even called with me on the phone to help with the approval process. $60,000 later, I have two degrees and have yet to find a job where I could use either of them.” —Larry K.

“Last year was my son’s freshmen year of college. He was A+ certified and chose to go to community college for welding—100% paid! When I spoke with the financial department the gal told me my son could take out the complimentary $3,500 loan every year. I ask her kindly (as kindly as I could) not to offer this to my son. I did tell him about this, and he said, ‘Why would I take out a loan? My goal is to finish college debt free!’ That’s my boy!” —Vickie W.

It Makes Frightening Sense

The Federal Student Aid office exposes all the scary details through an information guide on its website. Over the course of four years, dependent undergraduate students can borrow up to $31,000 in direct loans from the government and up to $22,000 in Perkins loans from their school. They can also apply for a Parent PLUS Loan, which is based on the parent’s credit score and has no borrowing limit. If denied the PLUS, students can take out an additional $26,500 in direct loans.

In fact, “there is no requirement for students to demonstrate financial need” to receive a direct unsubsidized loans. Did you catch that? Even students with no financial need and no proven history of responsible spending can borrow a total of $79,500—and that doesn’t include private lending options!

graduation cap

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The ease of getting a loan combined with pressure from advisors and the lure of having a good time is an all-too-easy trap for the average 18-year-old. It’s really no wonder they’re in debt up to their eyeballs.

Give the college students you know a little “preventative medicine” now so they won’t have to deal with the disease of debt later. Get The Graduate’s Survival Guide, featuring Dave's daughter Rachel Cruze, and confidently send them off to college!

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Ramsey Solutions

About the author


Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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