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Drowning in Six-Figure Debt for a Low-Paying Field of Study

Mark Kantrowitz

December 20, 2010

I am going to be attending a New York university this spring as a music major. My ultimate goal is to get a doctorate of ethnomusicology and to teach at a university while also completing fieldwork research. My loan debt will be very high (at least $100,000). Do you know how to attempt to get a high-paying college job right out of school? Also, will my loans need to be paid back if I go from undergraduate to graduate with no breaks? — Katie G.

There are very few jobs in ethnomusicology outside of academia, mainly working for a museum or library. Some ethnomusicologists work for record labels. Employment typically requires a doctorate. Even if you get a doctorate in ethnomusicology and are hired by a college, the salary is fairly low, $40,000 to $60,000 a year for an assistant professor. The median salary for all college faculty in musicology and ethnomusicology, at all experience levels, is $60,400 according to the Bureau of Labor Statistics. Job prospects in related fields, such as music therapy, aren’t any better, although the education requirements aren’t as stringent. Music in general is not a major that pays well, aside from a very small subset of popular performers.

Given that you are contemplating a six figure debt to pay for your undergraduate and graduate education, your debt-to-income ratio will be at least 2 to 1. At least a quarter to a third of your gross monthly income will go to repaying your student loans, assuming a 10-year repayment term and that you borrow only federal student loans. Such a high debt load puts you at very high risk of defaulting on your loans. You will need to use an alternate repayment plan to be able to afford your monthly loan payments, and even then you will be at the limit of affordability. Extended repayment with a 30-year repayment term will reduce the monthly payments to about 15% of your gross monthly income. The total payments under extended repayment will be more than twice your original debt. Just the interest payments alone will be more than what you borrowed. Income-based repayment and graduated repayment will start off with lower monthly payments, but will ultimately cost you almost as much in interest.

You will be in debt and struggle financially for most of your working life. You will have to assume a very austere lifestyle. You will probably need to continue living at home with your parents for the next two or three decades because your finances will be extremely tight. You may need to work two jobs just to make ends meet.

If you enroll in graduate school immediately after graduating from your undergraduate university you will be able to continue defering repayment on your federal student loans while you are in school. However, interest will continue to accrue on your federal unsubsidized Stafford and Grad PLUS loans, digging you deeper into debt. If you capitalize this interest by adding it to the loan balance instead of paying it while you are in school, your debt at graduation will be tens of thousands of dollars higher.

If you default on your loans, it will ruin your credit. Borrowers who default on student loans are often unable to obtain credit cards, auto loans and mortgages. You may even have difficulty renting an apartment, because many landlords check the credit histories of prospective tenants. You will not be able to escape from this debt, ever, because student loans generally cannot be discharged in bankruptcy. Less than 1% of bankruptcy filers who have student loans succeed in getting those loans discharged. The federal government will garnish up to 15% of your salary and offset your federal and state income tax refunds. The government will even garnish up to 15% of your Social Security benefits.

It is ok to follow your dreams, but you need to find a way to pay for them that involves a lot less debt. You must cut your debt burden at least in half. For example, you could borrow less by enrolling in a less expensive college with a more generous financial aid policy. (Your college is one of the most expensive and least generous colleges in the country.)

You should search for scholarships on Fastweb.com and other free scholarship matching services. There are several hundred music scholarship programs, but most are college-specific and have geographic restrictions. Still, every dollar you win in scholarships is a dollar less you will need to borrow.

Public service loan forgiveness might be an option, if you can find a job that qualifies, such as working for a tax exempt charitable organization. To benefit from public service loan forgiveness you will need to repay your loans in the direct loan program under the income-based repayment plan. After ten years of full-time employment in a public-service job, any remaining debt will be forgiven.

You should consider double-majoring in a more lucrative field of study so that you have a way of paying the rent and repaying your debt while you pursue your dreams.


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