quote:Originally posted by Blayne Bradley: I don't believe in cars, only mass transit so problem solved and a veyr large fraction of persons expenses made smaller.
That would be why you're always getting rides from people, then?
Posts: 10645 | Registered: Jul 2004
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Blayne Bradley
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let me rephrase I dont believe in driving cars, I'm perfectly fine with being driven if it gets me there faster and pay next to nothing except of course in the currency of gratitude and kindness returned.
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Since when have I ever had money to offer to pay for gas? no if a firend gives me a ride I say thank you and try to return the favor.
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The point is, where you are going, will you be able to cadge rides? If not, you may find that your personal mobility is drastically curtailed. Not that this is a problem, exactly; more opportunity to play games. I did without a car the first year in the US. You might want to invest in a bike, though.
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Blayne Bradley
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the plac eim moving to hopefully will at the leats have a bus terminal near by to get to my college, and form there I can get to anywhere else. Montreal has buses everywhere and metros that lead to othe rbuses.
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quote:Originally posted by Blayne Bradley: Since when have I ever had money to offer to pay for gas? no if a firend gives me a ride I say thank you and try to return the favor.
Blayne, if you can't afford to give your friends gas money for shuttling you around, I really don't think you need to be taking out loans to buy unnecessary things.
quote:Originally posted by Blayne Bradley: the plac eim moving to hopefully will at the leats have a bus terminal near by to get to my college, and form there I can get to anywhere else. Montreal has buses everywhere and metros that lead to othe rbuses.
Key word there is "hopefully". You NEED to find this out first. Because you NEED to make your own arrangements for transportation. That's the adult and mature thing to do. Depending on your family, friends, classmate, coworkers, etc to drive you around for free is just one example of the irresponsible behavior that your father is seeing and using against you.
And guess what. Public transportation aint free. A monthly pass on Montreal's STM system is about 3/4 of the cost of Chicago's CTA monthly, but that's still an operating expense you need to budget for.
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I don't have a car, or a license (but I can parrallel park!) and I get around with public transportation: trolley and bus.
Posts: 3389 | Registered: Apr 2004
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Blayne Bradley
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I can write as part of my expensives the cost of transportation and get it added to my bursuries, also only recently I can not afford to pay for gas, now I have a job so if I really have to I will once im paid.
And I mean hopefully because for all I know it coul be demolished tomorrow, I am never sure of anything but my friend assures me there is a bus terminal and an IGA near by.
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First off....Blayne, I hope that you realize that no one here is picking on you. They may be giving you advice that is the same, or similar to, what your dad says, but they are offering sound advice.
Go see the bus terminal yourself. Do the math, including interest on the loan, and find out why most people think taking a loan out for a gaming computer is not a good idea. Look at it without an ax to grind, and make a decision based on financial considerations.
Just because you thin your dad is an ass (he may or may not be IRL) doesn't mean he is really wrong about this, even if his delivery sucks.
Posts: 15082 | Registered: Jul 2001
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You are getting some pretty good advice here. If I had it all to do over, I would only use credit for two types of things:
1) Absolute necessities without which I could not survive or take on a position that was already offered to me and which paid enough to easily cover the expense within a short time (say 1 month, 2 at the most). This list is pretty short and includes medical care and some legitimate business expenses (like a decent but not extravagant "starter" wardrobe that I had to have in order to go to work at my first office job).
2) Long term assets with a high probability of increasing in value faster than the interest paid on the debt, or where the alternative sunk costs for things would be higher. This is basically limited to things like houses and only in certain economic climates.
In the grand scheme of things, this means never using credit to purchase things like: - assets that depreciate (like cars, computers, etc.) - non-necessities (like nicer clothing than I can pay cash for, better furniture than I could pay cash for, etc.) - entertainment (including vacations)
The amount of money I have wasted in my life (to date) on interest payments is staggering. It also has meant that I ALWAYS have to opt for earning more, working more, traveling more, etc. That has worked out fine for me at this point in my career. I work at a great company where I am valued. But there have been some pretty negative experiences along the way that I had to simply "suck up" because the options available to me didn't pay enough to keep up my debt payments.
I am not alone in this. Ask around. The term "wage slave" is a fairly apt description of most people. Even when you LOVE what you are doing, the idea that you have to keep doing it indefinitely because you're in a debt hole can be pretty depressing at times.
And the other depressing thought is that you have no-one to blame but yourself.
Because frankly, the process starts back when one is 18, 19, 20...and if you make the wrong choices then, you start yourself on a cycle that becomes inescapable without some pretty drastic measures (such as bankruptcy).
It seems like nothing now, but that $2000 debt when you are finally starting on your first job will be an anchor. If they decide they can only pay you a portion of the money you expect, it means you'll be floating that debt for longer.
And, of course, to earn money sometimes you DO have to spend money (clothing, a car, utilities, etc., etc.). When you look back at it, that $2000 will have cost you $6,000 in real money over the years. It will be a drag on you moving on. And you'll delay things like saving for retirement so long that it just becomes a joke: "Oh yeah, I'll be able to retire, just so long as there are still 3rd world countries I can move to, or the stores still sell dogfood at 3 cans for a dollar."
On the other hand, you can try to save your cash and when you have enough, pay cash for the purchases you need. So a $1000 computer costs you exactly $1000. Not $1,000 plus $2,000 in interest over the years.
That extra $2,000 you didn't burn up on interest can be used for something else. Or saved so that you can retire sooner than otherwise would be possible.
And, there WILL come a day when having saved up enough to survive for a few months will bring some very welcome relief as you find yourself out of work, or hating your job and needing the flexibility to start over, do something else, etc.
If your 40-year-old self could come back in time to today and talk to your 19-year-old self, he would tell you to NOT start taking on debt right now. Do yourself a favor and listen to the advice you're getting here.
The ones who are telling you this are probably either still in that gravity-well of debt or have experienced just how difficult it is to climb out of it. They are trying to save you a ton of anguish.
Posts: 22497 | Registered: Sep 2000
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Blayne Bradley
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my 40 year old self would come back only to tell me how to bring about world revolution. ^-^
But yes, I am doing all the calculations, as soon as I have time ill check the place out, and do some calculations, my friend has using excel come up with the approximate expences of 2 ppl in a 5 1/2 apartment (which Ild get to my self most of the time) 800 ish a month by the looks of it, we're figuring out how we can budget it to be less, for exmple buying from cosco, trips to chinatown to get ingredients for general tao chicken to cook and sell to locals etc.
so far my current job can make me 500 a month, the reserves will hopefully close the gap alot more, working flltime over the summer will also help keep the budget balanced.
Also there's a big difference between the advice here and the advice at home, my dad focuses on things ive done wrong in life aka tripping going up the stairs, as a reason not to sign, and when I proe him wrong he ignores it, changes the topic or tells me to shut up. The advice here is alot better and doesnt resort to insults.
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quote:Originally posted by Blayne Bradley: I can write as part of my expensives the cost of transportation and get it added to my bursuries,
Maybe it works differently in Canada than it does here. But here, each school calculates standard amounts (different for dependent and independent) for transportation, room & board, etc. The fact that your personal expenses may go up (or go down) would NOT change the amount of aid you receive.
I doubt this is different there, but check with your financial aid counselor.
Posts: 32919 | Registered: Mar 2003
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Blayne Bradley
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its the case, im given a sheet of paper to write down my opproximate expenseives for my student loans.
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Yes, of course you are. But that doesn't mean a change in your expenses will result in a change in the aid you receive.
Posts: 32919 | Registered: Mar 2003
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Blayne Bradley
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thats not what my financial aid person said.
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Your financial aid person likely told you they can update your financial aid package as your need changes. This does not mean they will update it every time your list of expenses changes slightly, this means if there's a major change in your need they will update it to reflect that.
Posts: 15770 | Registered: Dec 2001
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What fugu said. Large changes -- moving out and having the expense of a dorm or apartment, for example -- might cause your aid amount to be reassessed. Getting a bus pass will almost certainly not.
Moreover, even if your aid amount goes up, it will not necessarily entirely cover your additional expenses. Almost no school I know of claims to cover 100% of need. Most are in the 50-80% range.
Posts: 32919 | Registered: Mar 2003
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Blayne Bradley
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I know moving gets me an extra 1000$ in bursuries.
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*nod* Students living at home have a different standard room & board amount than those living elsewhere.
Posts: 32919 | Registered: Mar 2003
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quote:Originally posted by Blayne Bradley: the remainder of the loan I can return.
If you take out the loan -- and I am not suggesting that you should -- you should invest the balance of the loan if you're allowed to do so. The interest earned will help you toward paying back the loan. If you take it, you should do your absolute utmost to pay it back by the time you graduate. In Ontario, you begin to accrue interest on student loans six months after graduating. The last thing you want is to accrue interest on a loan you took out to buy something you didn't need.
Having said all of that, I don't think you should take out the loan. You should only go into debt for emergencies, tuition, or long-term non-depreciating investments (e.g. a house). I understand that you really want a new computer -- I'm a pretty heavy gamer and I know what it's like to want a new system or console, and want it badly, but I would never have considered going into debt simply to fund my gaming habit.
Consider: If you came here and posted about how you were going to take out a loan to fund your cocaine addiction or your bottle cap collecting habit, people would be extremely concerned. A computer has utility beyond gaming, yes, but you've already got a laptop and have said that you're just buying it because you want a gaming rig.
This is not a sound financial decision. The same components you've just spec'ed will be significantly cheaper when you've saved up enough to be able to buy the computer without a loan. No matter how confident you are that you'll be able to pay the loan back before interest kicks in, until you've actually spent a couple of terms in school and have a better feel for how much it costs, you can't guarantee that you won't wind up paying interest.
Posts: 10886 | Registered: Feb 2000
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Blayne, I am glad that you are at least considering the answers we have given you. I just wanted to make sure you realize how valuable this type of advice is, and how rarely it is offered without strings IRL.
You can still play your games, if not be the fastest gamer out there. I think that in the long run it would be far more valuable for you to avoid debt for as long as possible. If your financial situation is so limited that selling food to your neighbors is a viable income generator I don't think borrowing money is very responsible.
Posts: 15082 | Registered: Jul 2001
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quote: If your 40-year-old self could come back in time to today and talk to your 19-year-old self, he would tell you to NOT start taking on debt right now. Do yourself a favor and listen to the advice you're getting here.
The ones who are telling you this are probably either still in that gravity-well of debt or have experienced just how difficult it is to climb out of it. They are trying to save you a ton of anguish.
Bob very clearly said what I wanted to say. Those of us who are trying so very hard to discourage you from taking a loan out on a computer know, very likely from hard personal experience, what a bad decision it is.
When I went to university a couple of decades ago, I had no one to give me any financial advice. My parents don't spend money wisely themselves, and there's never been any amount of communication regarding financial matters. I was completely on my own. I made a lot of mistakes.
If I could go back in time and give my younger self sound financial advice, I'd be saying a lot of things that had already been said in this thread. Hopefully, I'd listen and make very different choices.
We're giving you this advice because we care about you. We don't want you to make the same mistakes we did. We don't want you to wind up in the same position we've been in ourselves. We want you to have a better start, one that's easier and filled with much less stress & despair and much more hope.
Have you been exposed to how to calculate compound interest on debts? The real cost of that computer is not $977.xx
The real cost is $977 + the interest that accrues. Now, granted, you intend to pay it off before you start owing interest, but, from the sounds of it, you may not really be in a financial position to do so.
Just imagine the situation that is MOST likely, not the one that is idealized and will work if everything falls into place for you at just the right instant.
Then imagine a WORST CASE scenario. One where, let's imagine, your government goes through massive spending cuts, reduces the number of people in the reserves, the economy tanks and there are fewer positions available for recent grads, etc. etc. Seriously, ask around. Ask some people who are just a few years older than you and what happened to them when they graduated and couldn't find work in their fields. Instead of pulling down decent wages for starting professional positions, they made a bit above minimum wage and many were faced with moving home, delaying life plans (like marriage, homebuying, etc.)
Do some math to see what you are really sticking yourself with.
And realize too that this is just the beginning. If you do not discipline yourself now, you will not be able to do it very much later either. And when someone offers you a larger loan, you'll take it, spend it and end up owing more, and more, and more...
This is how it all starts. You buy something you "want badly" and borrow to do it, and then find out that you can't pay it back the way you'd convinced yourself you could when you made the purchase decision. You will very easily decide that this computer isn't good enough and you'll spend more next year, and the next, and the next. It will also be easier to convince yourself of other needs. It's easy because you don't see the downside of all that borrowing until many years down the road.
Sorry to be so blunt, but this is a very important decision you are making now. It has far more importance than the simple dollar amount.
You obviously can take out the loan and buy the computer. But you should try to discipline yourself.
twinky's idea of investing the other money...well...I don't like it because I think that the investments aren't always a sure bet, but since the money is interest free, maybe it'd work.
In which case, why not borrow the money and invest ALL of it? If that's "legal" and "legitimate" use of the money, then it really is like someone is giving you a gift and you could make a nice little nest egg from it as it sits earning you money during the remainder of your school years. Then, just before it starts costing you interest payments, you pay back the loan and pocket the proceeds. That way, instead of ending your college career in debt, you've actually ended it with a bit of money set aside. Which you could use to cover moving expenses, the new (modest) wardrobe you may need upon starting your new job, the deposit on your new apartment when you move, and funding some other things that will be real necessities.
AND, you might actually make it through that first year after graduation without having further saddled yourself with debt.
If that's a legal/legit use of that money, then that would be the best possible option.
If not, then just let it go, don't buy the computer, and make do with whatever you can afford to pay cash for.
Posts: 22497 | Registered: Sep 2000
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If you're going that route, be VERY sure that it's a subsidized loan, not an unsubsidized one. The former (and these are US standards, but again, I'm pretty sure Canadian ones are very similar) means the government pays the interest until 6 months after you graduate; the latter means either you pay the interest, or it accumulates until you have to start paying back the loan after graduation.
Borrowing money at a low rate (or really, even interest-free) in order to invest it sounds like a seriously foolish idea to me, but heaven knows people make money doing it all the time.
Posts: 32919 | Registered: Mar 2003
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Interest free would be great, but I'd be cautious and only "invest" in something with a guaranteed return (like a certificate of deposit or some other sure bet -- NEVER the stock market or some other volatile investment).
But yeah, check out the loan provisions, there are some types of loans where they are willing to loan you the money interest free as long as you pay it off before the loan comes due, but then if you fail to pay it off, you owe interest for the entire time you had the money, not just from the point when it came due.
I don't really know how educational loans work, but if they work like that, definitely steer clear of it if you intend to spend the money. The unpaid fully accrued interest will make your initial loan seem very small in comparison.
Have you guys budgeted for the deposits you may have to pay before move-in?
In the US, first and last months rent and sometimes an additional cleaning deposit are required before move-in. That means on an $800/mo apartment you may need to pay $1,600 or more the day you move in.
It is fairly typical of student housing to require extra deposits because the places usually get so trashed that they need the money to do renovations after the students move out. So...don't expect to get your deposit back if they call it a "cleaning deposit" or something like that.
And the reason they collect first & last months rent is so that if you miss a rent payment they can come and tell you have until the end of the month to get out.
Posts: 22497 | Registered: Sep 2000
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quote:Originally posted by Bob_Scopatz: But yeah, check out the loan provisions, there are some types of loans where they are willing to loan you the money interest free as long as you pay it off before the loan comes due, but then if you fail to pay it off, you owe interest for the entire time you had the money, not just from the point when it came due.
I don't really know how educational loans work, but if they work like that, definitely steer clear of it if you intend to spend the money.
No educational loan I know of works like that. Stafford loans are either subsidized (if student need is high enough) or unsubsidized, as I explained above.
I don't know much about highly targeted loans like the one Blayne says is for computers specifically.
One additional catch. I am fairly certain some of the paperwork that you (and your parents) will have to sign specifies that the funds be used for educational purposes, such as tuition, fees, books, and room & board. Taking the money and investing it is at best a gray area, and may actually be illegal.
And as I said before, I think it's a bad idea, regardless of its legal status.
Posts: 32919 | Registered: Mar 2003
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Rental laws in Canada vary from province to province. I've rented in Alberta and BC, and in neither province is it legal to require last month's rent, only first month's rent and damage deposit which was equal to half a month's rent. In both provinces, if any of the damage deposit was to be retained by the landlord on moving out, they're legally required to provide an itemized bill detailing the specific reasons and costs.
Getting a landline, if you have no credit history, usually involves a few hundred dollars for a deposit, same as for utilities. Electric and gas may be done separately or on the same bill, depending on how it's set up in that area. If it's an apartment, heating may or may not be included, but electricity almost never is.
Blayne, have you done the research on these things for your province/area? Do you know how much you'll require in the way of deposits?
Also, some landlords will require the names and signatures of all inhabitants on the lease where others will require just one. Neither one is better - they both come with potential problems if there are difficulties in the rental arrangements, communications, and living style with your roommate.
Telephone, electric, water, gas usually want only one name on the bill. Make sure that, regardless of whose name goes on the bill, that you discuss in advance exactly how you plan to handle all the bills, when they'll be paid, etc. It's far better to be absolutely crystal clear, verbalizing things that you think don't need to be because they should be understood by everyone, when in reality, everyone walks in with a different understanding from everyone else.
I've had a lot of roommates over the years. A lot. With my first roommate situation, we actually came up with a list of household rules with appropriate punishments for breaking each rule before we even moved in together. It may seem like overkill, but the reality is that we had no communication problems and rarely had difficulties of any kind. Spelling things out as clearly as we did made sure there were no misunderstandings in expectations.
Posts: 8355 | Registered: Apr 2003
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listen to rivka -- she knows this type of loan far better than I do. And, yeah, I would guess that if the loan is earmarked specifically for computer purchases, then using it for anything else would be illegal.
Also, I think Tom mentioned the moral implications of taking money when you really don't need it, since it then would not be available to some other student who really does. The immorality of taking that money and investing it would give me pause even if doing so turned out to be legal.
So...forget I suggested it.
Re: Rental situations, yes, I have to imagine that your first room-mate experience will be similar to my own and that of several people I know.
In essence, you'll have a bunch of selfish, slobby people who are focused on things other than respecting shared spaces and each other's food and belongings. It makes for some pretty uncomfortable situations, even if you all basically like one another. Quid has some good ideas on how to make the situation work well.
quote:Telephone, electric, water, gas usually want only one name on the bill. Make sure that, regardless of whose name goes on the bill, that you discuss in advance exactly how you plan to handle all the bills, when they'll be paid, etc. It's far better to be absolutely crystal clear, verbalizing things that you think don't need to be because they should be understood by everyone, when in reality, everyone walks in with a different understanding from everyone else.
A signed co-tenants' agreement can be wonderful here, both for setting expectations and making those expectations enforceable if necessary. Many college housing offices have standard forms valid for their jurisdiction.
Posts: 26071 | Registered: Oct 2003
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quote:Originally posted by Bob_Scopatz: Also, I think Tom mentioned the moral implications of taking money when you really don't need it, since it then would not be available to some other student who really does. The immorality of taking that money and investing it would give me pause even if doing so turned out to be legal.
Yes. That happens a lot; students' parents will be footing the college bill, but the kids take out loans anyway and use them to buy houses. Thus making it all the more difficult for students whose parents are of a similar financial standing but AREN'T paying the bill to get the money they need.
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Well, we already know that Blayne doesn't need this loan, because he doesn't need a desktop computer. If he takes out the loan anyway, and it's legal to invest it (which it may very well not be since it's specifically for the purpose of buying computers), he may as well do that. If it isn't legal, returning the balance would probably be best, which Blayne already mentioned as a possibility.
Of course, I don't think he should take out the loan at all.
Added: Having said all of that, in Ontario at least the financial aid you can get is determined in part by your parents' income. I believe this is true regardless of whether your parents are actually helping you financially. I don't know if it's the same in Quebec.
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