Use Subsidized Stafford To Pay Unsubsidized Stafford? Does Your Education “Expire”?

Sierra is our official Outlaw Student of the Day (light bulb?). She wants to strike out on her own and go to Germany, she’s getting timid and bad advice from people close to her, and she’s creatively trying to solve her own financial problems. LOVE HER ALREADY.

Hey Judge Josh,

I have two questions for you, but hopefully they aren’t that difficult. First I would like your opinion. I am a Visual Communication Design major with minors in German and Communication Studies. It has always been my dream to live in Germany.

unsubsidized subsidized
I bet this is what Sierra looks like.

Sounds like you’re well on you way. Congrats!

The way I’ve decided to do this is by being an au pair after I graduate next spring. It’s a great set up because my food, lodging, and transportation are paid, but unfortunately I wouldn’t be making hardly any actual income.

I agree, it sounds excellent. There are lots of ways to make side/fun money, and it sounds like that’s all you need. Hopefully the family that’ll be employing you will actually give you a  little bit of time off from the kinder to enjoy the country!

My advisors keep telling me this is a bad idea because when I come back after a year my education will be “out of date” due to field I’ve chosen.

Please, please, please — tell me that the “advisors” saying this are not employed by a university and earning actual American dollars to give advice to students. The only way I know how to respond to advice that bad is with sarcasm.

  • Yes, it’s a TERRIBLE idea to go live and work in a foreign country while you’re still young, and to completely immerse yourself in its culture and language. That won’t add to your lifetime employability and earnings potential at all.
  • It’s true, your Visual Communication degree that you receive in 2011 will be as antiquated as a certification in hot typesetting or manual butter-churning when you get back from Germany — in 2012. Shit will be so different that you won’t even recognize the world around you. Bacon will come in spray bottles. Motorcars will fly in the sky and they’ll be windowless and you’ll control your speed by how loud you hum. And surprisingly enough, you’ll be able to smoke in restaurants again.
  • This is because Germany is a black hole of visual communication and design. It’s not the birthplace of Bauhaus, Dieter Rams, the Ulm College, etc. It’s not where an overrepresentative portion of the world’s best web and interactive designers live today. And of course it has no Internet access that might allow you to follow trends and sharpen your skills while you’re there.
  • There’s a bright side, though. Your school will give you all your tuition money back, since they defrauded you by selling you four years of education that apparently goes “out of date” in 12 months.

OK, now that I’m all worked up and pissed off at people I don’t even know, we’ll let Sierra continue.

This is something that I really want to do though and I feel that graphic design can’t really change that much in a year. What do you think?

You know, I think I agree with you. 🙂

And this leads me into my second question. When I started school I knew nothing about loans and neither did my parents. I took out $5,000 in unsubsidized Stafford loans and paid everything else with scholarships and tuition reimbursements from my job.


I just recently figured out that this has been accruing interest over the past two years. I had understood that interest didn’t start accruing until I graduated, but I guess I misunderstood.

Yeah, that’s for subsidized Staffords. With unsubsidized Stafford loans, it accrues the whole time.

Would it be a good idea to take out a subsidized Stafford loan this last year of school and use it pay off the unsubsidized? I know $5000 (about $5700 now with interest) isn’t much, but I won’t be making much of anything at all straight out of college and payments are gonna be difficult.

To be honest, I probably wouldn’t mess with it at this point. It’s already accrued interest for two years and you can’t change that, and it’s only going to accrue for one more before you’re out of school and it’s accruing anyway. Doesn’t seem worth the paperwork hassle to me.

HOWEVER…look a little further into the future. You said you’re going to need money in Germany. You could certainly take a subsidized Stafford now, while you’re in school, sock the cash away and use it while you’re in Germany. Just sayin’.

Any advice would be much appreciated. Thank you!

That’s mine. What about you guys? Any thoughts on the loans, the move to Germany or a future with windowless cars controlled by humming? Let us know in the comments below.

15 thoughts on “Use Subsidized Stafford To Pay Unsubsidized Stafford? Does Your Education “Expire”?”

  1. I think this is a great plan. You are very lucky to only have $5700 in loans. I know people who have 10 times that much. I do agree with Josh in taking out a loan to have money while in Germany.

    If I could ever go back in time and give myself advice, it would be to live it up and take adventures when I am young.

  2. Go to Germany while you can. One thing I’ve learned at all of my 21 years of age is that college advisors are idiots. I’ve had them talk me into the wrong courses, advise me into on campus living etc. A degree should ot go out of date in a year. There might be changes in the feild in that time but if you keep up with it or you take a part time job in Germany using your skill you won’t fall behind.

  3. The Judge has it on this one.

    The thing about advisors is they usually don’t get paid or trained to be advisors. So it’s not a surprise that those acting in an advisory capacity sometimes talk directly out of their butts. They are supposed to at least act like they know what they are talking about. And that’s something most of them ARE good at (instructors are hired based on this ability, in many cases).

    I think you would be better served to take the loan and put it away, as well. You have to start paying 9 months after graduation. You’re going to be there 12 months, so that means you’ll need at least three months of minimum payments on hand when the bills start coming due. Bettter safe than sorry.

    If you create a portfolio site and showcase whatever work you have or can get done there, you can get some freelance work in, provided your employers are on board with that. You can do print, video or web from a computer no matter where you are (just make sure you bring a transformer for your UPS). Bear in mind that your host family will know someone who knows someone who needs that kind of work done (it’s almost embarassing, how often friends can help that way). If they can help get the word out to their friends and family, so much the better.

    The spray bottle bacon line was priceless. Glad I wasn’t trying to eat anything when I read that.

  4. I took a year off after school and moved to California to be a nanny for a couple of years and loved it. I made lots of friends and experienced things I never would have had the chance to do otherwise. I have never regretted my decission to be a nanny and like you I had people telling me what a bad idea it was. I am now 39, the mother of three, and back in school again. My advice to you is to go and have fun, do the things you’ll never get a second chance to do, live a little before you settle down with a career, husband, family, etc…There is no better time to do this than now while your young. Enjoy!!

  5. Claire Rementilla

    I’m sorry but WHAT THE $@#$# does “out of date” even mean?! You are living YOUR life. You were born on this earth with legs that can carry you to wherever your heart desires. Out of date? Who in their right minds would think that getting a head start on a career that will waste away your life be BETTER than traveling alone in a foreign country full of a horizon of possibilities and life lessons of personal growth? Do what you want to do. What does the degree even mean anyway? I was an au pair all last summer in Montreal and it was probably the best summer of my life. Life is so, so short. And time goes incredibly fast. If you don’t do these things now, if you put them off, there is a chance they won’t happen. I know it’s scary and risky and nervewracking but you never know what will happen. Do what you love and things will work out.

  6. Go for it, Sierra!!! Life experience is much more important than people give you credit for. Freelance and you will keep up to date in the latest trends.

    Also, if you have trouble making your loan payments, you will probably be able to get them deferred if you are not making any money for another six months if you contact your loan providers. Yes, they will accrue more interest but since you are so low in debt it will be worth it.

  7. Sierra,

    I moved to Belgium for (what I thought would be) a year after college. I had the same fears – that a year away from looking for jobs would hurt me. What ended up happening was that I found a job, made some contacts, and ended up getting an offer for basically FREE graduate school (Europe is pretty awesome that way – I pay 250 euros a year in fees for my graduate degree). I’m still here, 6 years later.

    My little sister did a year of Au-Pair in Europe and that gave her some contacts to go work in New Zealand, and when she got back to the States, her resume looked so awesome that her first “real” job out of college is a director’s position (her employer wanted someone with 5 years of experience, but figured someone so self-sufficient to travel the world for 2 years had to have some talent).

    What I’m trying to say is that moving abroad will change your life – you can’t predict what will happen, but in the majority of the cases, great things come of it. Even if you don’t get any fancy job opportunities, you will understand more of the world and be more capable of being productive in it.

    Just one word of warning: be very very VERY picky about choosing a family to Au-Pair for. Realize that you will be part of their family for a year, and that is an intimate situation… not very comfortable if you don’t even like them. Not to mention, some families treat their Au-Pairs like treasured daughters, and some like Cinderella. Just be careful, and screen prospective families well.

  8. Our youngest of four daughters, now 22, had two au pair assignments (took off a semester, returned to school; took off another semester, will return next year). She is a painter and was in Nuremburg for four months) in 2008. The regimen of caring for a German family was grueling; they wnated a maid not a babysitter. Further, she had emergency surgery the first month. She survived at no expense, medical or travel for us. The cultural
    experience far exceeded a two week tour or a hostel romp through Germany. Train trips to neighboring countries, museums, art schools, festivals. When she returned we saw a maturing young woman.

    She was in Tuscany Spring 2009-Oct 2009. She was a real aupair and travelled with the family to the beach and the mountains. She learned to speak Italian (she studied German in HS).

    She returned more mature and more self confident. She has narrowed her career possibilities and is planning to return to school next year.

    Do this while you can. I’m a 62 year old African American woman.
    When people ask us “How could you let her just take-off by herself?’ I reply that kind of opportunity would not have been considered or available for the first generation desegregationists.
    So, we have learned from previous misdirections and are continuing to let our daughters be and become.

  9. Sierra,

    Go to Germany! Being an au pair is an invaluable experience, and exposure to German art and culture could really make your art stand out.

    That being said, let me give you some advice as an American who grew up in Germany. If you get another job for extra cash on the German economy, you will no longer be able to work for Americans overseas; which could close some serious doors in your future (whether you know about them or not). See if you can land a job with a family close to base, and apply for jobs on base. Americans overseas are always looking for someone who can do graphic art to help maintain their respective websites. You could probably do that from your computer without having to commute to base; and getting an American ID card also has the advantage of letting you go to the commissary to pick up that box of macaroni and cheese and tube of cookie dough when you are feeling homesick.

    There are also a ton of consulting firms that work in Germany that you could get a part-time job with by helping maintain websites, and making logos. The important thing about getting a part-time job is that they pay you in dollars, NOT Euros. As long as you are paid in dollars, you are considered to be working for Americans, which will keep doors open for you in the future. Universities and larger corporations can make arrangements to pay you in dollars.

    The au pair program is exempt from these rules because it is a government sponsored program; but you have to be careful about extra sources of revenue. You should defiantly take out the loan and use it in Germany; and I am pretty sure there are some scholarship programs for au pairs out there, and you should look for those.

    Worst case scenario, get a job online with an American company. If you have time this semester, I would work on creating a good working relationship with a company in America, and get permission to telecommute. That way you could live in Germany and still have a job outside of taking care of kids.

    Good luck, and have fun! If you run into me in Munich, give a little wave. Bis bald!

  10. What her advisers are saying, because mine say the same thing, is that the graphic design world changes really rapidly. I’m also a design/graphics major. What they are cautioning her against is taking a few years off and not touching her design projects. Her education will not be out of date, but her skills will be. Just taking one year off will leave her industry knowledge far behind. As long as she sets aside time for her degree work, she could come back from Germany with a good deal of both life and career experience.

  11. Hello!
    I say take the amazing opportunity, traveling to Europe in itself if you have not yet is well worth any time or money it costs. It could definitely increase your diversity of work, increase your inspiration and gain more world wide connections. You’ll be learning a different perspective in the industry and as the Judge has mentioned it is so rich in design schools and industry. It’s amazing how much a year can offer, and it won’t make your degree a dinosaur, I think it would actually polish it quite well!

    It could be a number of reasons that your “advisers” don’t want you to leave. They want you to stay where it’s safe and known, or they don’t want to see you go. The adventure outside of a comfort zone is well worth it though.

    I speak as an artist as well, (in the field of media arts and animation) and someone who hopes to work at an internship in England fresh out of graduation too. So we seem to have similar dreams! =)

    Good luck to you and I hope you the best!

  12. I don’t know what’s wrong with college “advisors” these days. It seems to me all they ever do is give out bad advice!

  13. Yeah , visit europe while you can. If you miss the opportunity now you probably won’t get the chance again until you’re retired.

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