Dr. Steve Sherick wants to build the emergency-care business he started two years ago that now employs seven doctors and two part-time administrators. The $300,000 in student loans he and his wife carry makes that prospect difficult, he said. Sherick, 36, who contracts with a local hospital in Trinidad, Colorado, about 200 miles south of Denver, graduated in 2009 with about $140,000 of debt. Thats not counting the student loans of his wife, a pediatric oncologist, and their mortgage. He would like to hire a full-time administrator and offer more competitive salaries to entice doctors to work in the rural community. It deters an entrepreneurial spirit when you already start four steps behind the starting line, said Sherick. The student debt increases the risk for an entrepreneur like me and makes it harder to expand new business, get loans and thus hire new people. Former students hobbled by a collective $1 trillion in education loans can be hindered in expanding or forming small businesses and creating jobs for themselves and others. While self-employment among those 65 years old and over increased 24 percent in 2010 from 2005, it fell 19 percent among individuals 25 and under in the same period, according to the Small Business Administration. The burden of student debt probably places pretty big constraints on your viable options after graduation, said Dane Stangler, director of research and policy at Kansas City-based Kauffman Foundation, which focuses on supporting entrepreneurship. With more student debt and stricter bank lending, it really hinders the ability of students to take risks, start a company. http://www.bloomberg.com/news/2013-...-crushes-business-dreams-of-u-s-students.html
So what do you suggest? These people knowingly took on this debt with the hope of making a killing after graduation. Now they are going to whine about it? Sounds a bit like the folks whining about taking out mortgages and then crying because they are upside down. I've never seen the sense of going $200,000 into debt not knowing how and when you'd be able to pay it back.
The conservative side of me agrees with you to an extent. However the problem is that the cost of a college education is ridiculous these days. I did an analysis of my own and found that the same college education that I got in the late 60's has increased in cost by a factor of four. That's after adjusting for inflation. The actual dollars have increased by something like 30 times. Add to that the student loan program has mostly been turned over to the private sector which is damned near as predatory as "Payday Lenders". If I was just graduating from High School today, and in a similar economic situation as I was back then, there ain't no way I could afford to go to college.
Well we could at least go back and have states have one basic university campus, few frills and good facilities with professional post-graduate programs and make entrance based largely on academic aptitude but keep costs really low. Seriously at least if state options were low cost you could have doctors leave trained and with debt being perhaps 40% the norm from entering the University through their medical degree. And you could tie the pre-med program into the MD program maybe shaving off a year for a joint degree. I blame states they wanted their universities to compete with private schools and no longer focused on offering good educations at a modest price that got the job done and had entrance standards high enough to be seen as serious schools.
Part of the problem is the demand. EVERYBODY goes to college, so they know that you're going, like it or not. People don't even ask if college is a good idea, any kid who graduates with a C- average expects to go to college. In essence they're doing exactly what we told them we want -- get every kid a diploma, and parents and students will pay any cost to get that diploma. Which is creating problems beyond just the debt. Debt is bad enough. And it comes from a merger of a culture that sees college as a necesity and so there's no limit to the cost people are willing to bear in order to get the product that we've been trained to see as "the only ticket to the middle class". It also comes because a lot of people do almost no homework on the feasibility of paying for college, and even less on the suitability of their majors. Colleges, of course are only too happy to have a kid who would be better off in a trade school or community college spend $20K on a degree that anyone with a brain should know is worthless. It doesn't even make people blink anymore. But the other side is equally as bad. In the old days, college graduation meant something. It was really due to 2 factors. First, college graduates were somewhat rare, and secondly the diplomas earned meant that you possessed high skills in whatever you chose to study. Neither of these things are true anymore. College is the new, really really expensive high school. Remember how impressed your boss was that you graduated high school -- like not at all. That's college today. It means functional literacy and functional numeracy. It doesn't mean you have a strong skill set, it means you're average. The second part is the scam of college. In order to get to the point where a C- high school kid can graduate from college, you had to dumb down the content. Having a stupid kid fail out of a class means that you don't get HIS MONEY, and that's a stupid business plan. So colleges have long since borrowed a page from the McDojos that sprang up because people wanted to pretend to know Karate without having to work for it -- make the tests and the courses easier. Fewer failed tests means more butts in the seats and more tuition checks to be cashed. So the chances of failing out of college are a lot lower than they would have been in the past. You don't fail English for barely changed wikipedia-based "reports". You don't fail history unless you think that the Civil War happened in 1950, and again, if the teacher expects you to write, just edit the wikipedia entry and call it a day. It's really something to see. I have a high school textbook from 1950, and it's written at a higher level than a lot of college textbooks. It's the same with almost any textbook. Go check one out from the library and you can see the difference immediately. Any subject. When you're selling a diploma instead of an education, you have to do that, because the students that got admitted even though they needed remedial math and english work aren't going to be able to get a college level graduation. They get the degree they bought, but they have to go through 4 years of fake education or the school loses its accreditation and the diploma turns into a normal piece of paper.
There's his problem. Entrepreneurs don't need to go to college, except to make contacts. That is an expensive way to make contacts. You go to college to get a job. If you plan, in your life, to start a business, skip college and put the money to better use.
College has it's place. I would advice a few courses that can be gotten from a community college. Basic accounting, business law, things like that. Not for the contacts and not for the diploma, but because you need to understand bookkeeping, tax laws, regulations in whatever industry, labor laws, stuff like that. It isn't needed for the idea, but if you can't look at your accounts and figure out what's going on, it's harder. but then again, community college is pretty cheap.
There are multiple issues here. First, I doubt that the two doctor household picked a normal everyday middle-class house, so their mortgage could be the deciding factor for them. Second, college costs keep going up because applications keep going up. It is supply and demand--they supply the magic piece of paper and demand stays up as prices rise. There is no equilibrium. If demand were to suddenly drop like a rock, then perhaps tuition will as well. Third, related to #2: One can earn a lot of college credits while still in HS these days if they apply themselves. Through dual-enrollment programs with community colleges, a lot of people can cut a year or more off their formal college career if they so desire. Fourth: I really wish we had more of a system like the UK in the US where you have smaller high schools (called colleges) that are more oriented toward specific careers. I also wish more people would opt for an associates degree only, especially if they had no clue what they really wanted to do, and then go back and pick up the Bachelors if necessary once they were in a job and knew which degree to get that would help them advance. An Associates says "Hey I can do college and am willing to work my way up" to me. Edit; and 5th: there are income contingent student loan payment options where anything you have not paid off in 20 or 25 years gets written off. You just have to pay income taxes on the discharge amount.
JC's provide all sorts of good classes and benefits. Any business owner should know how a business is run. I probably should have added that caveat.
I have a basic message I'd give to any kid getting ready to graduate. Take a year, maybe two, and figure out what you actually like to do, and develop a business plan for your self. Imagine that your future is the product. Have a plan for how you will get to where you want to be. If it involves college, then have a sense of the odds of your plan working, have a plan for how to proceed if it doesn't. Have a reason why college actually makes you a better employee, and why it's not going to work any other way. What happens too often for these kids is that they have a vague idea of what they like (hey I liked English and I got good grades so...) and it never goes beyond that. Or they fall in love with some idealized version of some job (author, musician, lawyer, or something like that) that they never intersect with anything they actually do all day. Here's a test to see if you actually want to be an artist (including an author) if you aren't publishing your work NOW, before college, you have a fantasy. A real artist of any type would not be able to stop themselves from producing something in their medium. If they really want to design video games, they should have a hard drive full of published mods in their favorite games. If they really want to write a novel, they should be submitting stories to literary magazines or online contests. If it's art, again, if you aren't drawing something and publishing at a good clip, you have the fantasy, not the reality. I think honestly it's true of most careers. If you're a real engineer type, you like to figure things out, you like to real about science topics -- no one can stop you, and most likely you have a jerry-rigged something in your garage. I think it's backwards, because we never slow down long enough for a kid to become himself FIRST, before he decides what he's going to do with the rest of his life. It's a tall order for a kid who's interaction with the outside world amounts to cashiering and fry stations. If they take a year and maybe try different things, try to write a novel, try to build something that doesn't fall down immediately, paint something that someone would pay for, or even man the phones for a lawyer or a doctor or something -- they'd have some idea of the grown-up world's day to day activities. If they really want to be a journalist, they can start a blog and cover local stories. You learn how to work, but just as important you figure out how you do those things, whether you really like them and how the skills you'll learn if you go to college translate. Which is another problem -- when kids go straight to college, they never make the connection between the classroom and the workplace because they've never been in that workplace. You could be learning something that you'll use everyday once you graduate, but you don't know that at the time. So you'd be tempted to blow it off rather than really make sure that you get it (especially if it doesn't happen to be on the test). Or you find out the stuff that isn't even covered that you need to know -- accounting or computer troubleshooting, or how to navigate a chain of command in a business to get things done. You might need courses that no "advisor" will tell you about.
I just recently graduated in June and I just started college last Monday (I am currently attending a community college and will be doing so for the next two years and then I will transfer to a four-year college) and I will be majoring in Business Administration. I have a positive mind and I KNOW that I will own a a major corporation and several other businesses/subsidiaries, but I would rather attend college to gain knowledge, make contacts, and actually graduate knowing how to do my job but some people here believe that someone is better off not attending college and starting a business right away if that individual is interested in starting/owning a business. When I was younger, my family used to own a small business which eventually grew to become known all the way into the Middle East and I sometimes went to some of the finest/most expensive law firms, hotels, airplanes, etc to assist my family in doing the job (we specialized in leather re-finishing and restoration) and I promised myself that one day, I wanted to have a business of my own and the thought of starting one right away quickly flew into my mind, however, I know that I would rather feel safe gaining knowledge and possibly some experience beforehand instead of starting right away and being somewhat clueless of what I am doing. I respect the opinions of others who have shared here, but I (again, I'm a Business Administration student) am just sharing what I feel safe doing.
Speaking as a business owner, and a coach/trainer for entrepreneurs, business owners and sales people, there's nothing wrong with feeling safe and prepared. I recommend that during your time in school, you also seek out some assessments which will help you determine your innate strengths and personality profile. This will help you find the right people to partner with in the future and be extremely valuable as a good start to any career involving business ownership.
I appreciate the information and advice that you have provided me with, thank you. I will definitely look into seeking out some assessments during my school years.
