I just paid my bi-monthly bills two mornings ago.
Comfortably so, I might add.
But that was because my car is still relatively new and I haven’t run into any costly repairs. I rent an apartment so any problems that occur rests on the building’s management and not out of pocket and I finally paid off my MacBook on the store credit card. I can only imagine if I was working a dead end job, had a POS car, with gas right under the $4 mark in my city and working a dead-end job or hustling from music gig to music gig.
And then I paid my Sallie Mae bill.
I logged on to see the amount owed for both undergrad and grad school and I broke out in hives. I’m writing this blog in an urgent care facility where they’re trying to pump me with something to get rid of the rash that broke out all on my face. Well, okay, I didn’t break out in anything and there are no rashes on my body, but that’s how I felt. When I clicked the “pay” button I felt not only my checking out decrease, but a piece of my soul become snatched by the devil named Sallie Mae.
Honestly, Sallie Mae is an agent of Sheol. She snatches your soul with a phone call from an area code you’ve never heard of or a toll-free number to remind you about the bill you owe. As if any of us who have been by some institution magically forgot that we owe a debt that includes five digits. How you know that she’s a minion of Hell is that they offer you forbearance. Forbearance is a trick of the enemy, a tool of the devil. You simply apply for deferred payment, which they grant you, yet interest accrues and then when that date is come due, you owe even more and you haven’t even paid it down. Forbearance exists because Sallie Mae knows she’s going to get her money, either today, tomorrow, next year, or in the next 30 years.
What stunned me was that I looked at what I was paying and I said to myself, am I even making a difference? It was a feeling that was even worse than the couple of times I was making a minimum payment on that credit card bill for Best Buy and my laptop. The tugs of Sallie Mae dragging me deeper into her clutches was combined with her partner in crime, Direct Student Loans–the ones that paid for my grad school. That bill…..well, in the words of Sweet Brown all I can say is “oh Lordt sweet Jesus.”
I called Direct Loans and according to what I make annually, they told me I can afford the $270 minimum monthly payment. Really? So you know what my monthly bills are and what I need to pay? I’m so glad between
Say-tun Sallie Mae and Direct Loans they know what my monthly obligations are. Could I get rid of my cable bill? Why yes, yes I could. Could I stop eating out quite as much? Yes, yes I could do that as well. Could I stop dropping goo-gobs of money going to the movies? I could do that as well, yes indeed. Could I stop my random weekend jaunts all over the regional South? Yes, I could stop that as well.
Which brings me to my point, the inability for me even with a professional job to begin serious wealth building is going to cause a ripple effect for generations to come. Yes, I could move to a bare bones existence and I definitely could have gotten a cheaper car ergo a cheaper car note and there have been some financial decisions I should have made differently, but, still with ol’ Sallie hawking down my neck like a fire breathing dragon, some of this is for naught. If I was in a position to save anything based on my current lifestyle, the $270 required is a king’s ransom in exchange for my wealth building prospects.
In an economy with dollars aren’t able to buy the same amount of commodities that it once did, and a job market that still has much room to grow, this glorious lifetime debt of student loans can’t be more inopportune. Granted this is a problem for kids across racial boundaries, but tied by the similar economic situations. Working middle class families across the country with baby boomer parents were never situated in the best position for this economic crisis we find ourselves.
But here’s the difference, and why I drew this on race lines as well.
White families , the baby boomer families, sons and daughters of World War II vets had the GI bill which set them up in decent housing and gave them the “American dream.” Meanwhile black soldiers either returned to a Jim Crow South or ended up in federal housing in the urban city centers of Chicago, Detroit, Philadelphia, and New York that ultimately became the existential hell called public housing. Those white families that were settled middle class were able to send their children to college, or their sons fought in Vietnam which again provided them the opportunity for education. Black soldiers again, returned unfair housing practices and seeing no-bid contracts go to white politicians’ cronies. In the early 1970s, the black middle class was a piddling small percentage of the whole black population. It wasn’t until the 1980s that blacks saw a major increase in the the middle class income segment of this demographic.
So let’s do some simple math. While the gap between 1946 and let’s just say 1980 to be fair is 34 years, easily one whole generation behind where their white counterparts started. That’s a whole lifetime of work at any place; 34 years qualifies you for retirement with a full benefits package. But mind you for that whole time, blacks were the last hired and first fired with any company that wasn’t black owned. Suffice it to say, black working class families that do send off their children to school don’t always have the money to pay for it.
Most HBCU institutional advancement and enrollment offices will tell you the millions of dollars that come from Sallie Mae as debt incurred by the students and not personal checks from families paying for their education. Not to mention, many of the private donors are not independently wealthy black people, but white charitable institutions that have a history with the university that goes back to pre-World War II era. Just the fact that many of these donors are headed by the progeny of these wealthy white men proves my point. Whereas other families have this generational wealth passed down from the 19th century, blacks are barely out of the starting gate.
Many will read this and point to persons like Robert Johnson or Oprah Winfrey or even more erroneously point to Sean “P.whateverhesgoingbyrightnow” Combs or Jay-Z and ask how did they make it. First let’s cross the hip hop moguls from this equation because none of them darkened the door to any institution of higher education and were never strapped with student loan debt. And obviously, the likes of Oprah almost supercede race; name me one woman who has controlled that much of a media empire and has made so much of an impact globally irrespective of race. Yes, for Oprah to have been born black and a female in Kosciusko, Mississippi and make to where she is amazing, but it’s amazing just because she’s in the stratosphere at all–it’s just amazing she’s there anyway.
So, I’m not buying the Oprah argument. You can leave that at the doorstep.
Actually, I think who better illustrates this point is Barack and Michelle Obama. It was famously known during his 2008 campaign that Barack and Michelle didn’t pay off their student loan debt until he happened to write a bestselling book.
I’m going to let that soak in.
Two people, two lawyers who are making big bucks, can’t afford to pay off their student loans until they’re in their 40s. Their combined student loan debt was more than their mortgage. You can’t tell me that that’s not the work of SAY-TUN. Essentially you’re telling me I have to hope to strike it rich or else I’m going to be paying on this crap until I die or Jesus comes back — or God sticks a toe out from the clouds and ends this foolishness immediately.
In comparison, look at the generational wealth that came on behalf George W. Bush and a family that was able to get in with the Texas oil industry. Or in the case of John Kerry who simply married into a billion dollar family. The likes of Mitt Romney who had the benefit of Bain Capital corporation and investing techniques in which they reap the benefits of their private investments. That is to say, Romney and his family bring in over $20 million a year in investment income in recent years, and has put their current net worth upwards of $200 million.
Consequently, the Obamas net worth as of 2010 is slightly over $7,ooo,ooo and I’m sure hasn’t budged much since then.
Again, let’s do the math: $200 million versus $7 million. Which one really has the capacity to build wealth? The Obamas in true black family form, don’t have their money in major investments and nothing long-term that puts them in a position to better effect their family and their community outside from the automatic government assistance. Consequently, the Clintons combined wealth is over $100 million much of which has come from the same income source as Obama’s: book sales royalties. Not to mention, Bill Clinton has a speaking fee of $150,000 — yes, a whole house.
Wealth, in case you’re wondering is your overall assets minus your liabilities. This becomes particularly direct and poignant when a couple of years ago, black women on the blogosphere and social media were in an uproar when it was announced their median wealth as a demographic was only $5. I guess they could grab meal from McDonald’s $1 menu and not go into debt for it. This assets minus liabilities equation is serious when it means what can you give over to the next generation is a serious deal. Part of my point is that even still for a black family that has reached the status that only 43 prior families had enjoyed, the Obamas are far behind the pack.
Gloriously rich by my standards, but still you get the point.
Are student loans the singular thing preventing black wealth? No of course not. All of my friends telling me to put black rims and red brake pads on my car is what’s holding us back. Seriously, for what purpose? I bought a car that I can only afford with this job I have, and the car clearly is depreciating in long-term value and I have a $19,000 liability on my hands. Add that $19K to the school loans I have amassed and I don’t even know how much anti-wealth I have.
Not to mention the effect that this recession had on the black community. It’s a documented fact and not a twisting of facts that indeed in some parts of the black community, the recession felt a lot more like a depression. With black earning power a fraction of that for their white counterparts, it’s no wonder when you lop student loan debt on top of that, the prospects of legitimate wealth building are about as probable as winning the lottery.
Take my parents for instance. My father worked his whole life, 39 years he consistently held employment and provided for my family, but it took his whole life to work and provide enough of a middle class lifestyle, yet retirement comes and those savings, pension pay outs and Social Security checks are barely covering monthly expenses. Even if my parents had made the best financial decisions over the years, they still wouldn’t be in a position to do anything with regards to wealth building and passing on something to me. Perhaps the house would be bigger and the car would be a bit fancier, but there would never have been a trust passed on nor endowments to give to _______ University in their name.
Even before the “POTUS with the mostus” the Preezy of the United Steezy Barack Obama “slow jammed” the news with Jimmy Fallon last night, I was going to write this, but Obama further illuminated my point last night. This level of debt is crippling. The sliver of hope that you may have that one day you’ll
Just as a side question though, if you had $25,000,00 free and clear, married with children, what would you do with it?
Keep it uppity and keep it truthfully radical, JLL