Wiping Out $90,000 in Student Loans in 7 Months

Wiping Out $90,000 in Student Loans in 7 Months

By Josh Mitchell | The Wall Street Journal – Fri, May 18, 2012 3:42 PM
(See article here)

Economists are increasingly worried that many young Americans will spend coming years buried under student debt. Joe Mihalic was determined not to be one of them.

Faced with $90,000 in student debt from his days at Harvard Business School, Mihalic vowed last August to eliminate every penny by this summer. He did — three months early.

Courtesy: Joe Mihalic

The 29-year-old from Austin, Texas, is now becoming an Internet celebrity of sorts as financial advisers and young Americans link to his blog, NoMoreHarvardDebt.com, which had 180,000 hits as of Thursday morning. His story is touching a nerve at a time when young Americans are more indebted than ever.

So how did he cut through $90,000 in seven months? It helps to have a low-six-figure salary, as Mihalic does working for Dell Inc. But he also recommends getting roommates, a second job (in his case, landscaping), forgoing all restaurant dining (even McDonald’s), selling all unnecessary items around the house — and getting a flask.

Mihalic said he spent months taking a flask of liquor to bars so he could continue to go out drinking with friends without running up a tab. (Be warned: this is typically illegal.) Instead of the movies, he took dates out hiking, or for bagels and coffee. He ate protein bars packed from home and walked several miles to the city, to save a few bucks on transportation, during a trip to Michigan. He got two roommates to rent out his house.

Mihalic also took steps that financial advisers typically say are a no-no: He liquidated his individual retirement account, drawing a tax penalty, and stopped contributing to his 401(k), even though his employer offers a matching contribution.

“My mentality was I want to be done with these student loans as quick as possible,” Mr. Mihalic says in a phone interview, adding: “It was an emotional decision.”

He made his last student-debt payment six weeks ago. He said he saved roughly $40,000 in interest that he would have paid had he stayed on the 15-year schedule for repayment of his loans.

He says he learned other lessons, too.

“The flask thing, it’s kind of demeaning,” he says. “The funny thing is that girls weren’t really sketched out by it…They did laugh, and I could still get their phone number. It taught me a lot — you don’t have to be this flashy dude, buying drinks.”

(This article originally appeared in the Wall Street Journal  – Fri, May 18, 2012)


Travel Makes Better Executives

Travel Makes Better Executives

(Original Article hereon http://www.MeetPlanGo.com)As a long term traveler on sabbatical, I am occasionally asked, “Are you concerned about coming back to work?  How will you explain the large gap in your resume?

Each time this question is posed, I calmly reply “of course not.” As the months have passed, some of the lessons I’ve learned are easier to articulate than others. Nevertheless, here are five skills that I have tuned while traveling. I am sure that these skills will make me a more confident executive leader and apply to other travelers as well.

Separate the Wheat from the Chaff

At some point every executive has had to make a decision with less information than would be considered prudent. In a complex business environment, executives need strong analytical skills for sure, but the best leaders regularly listen to their intuition. As Malcom Gladwell describes in his book Blink: The Power of Thinking Without Thinking, we do that by “thin-slicing,” using limited information to come to our conclusion.

In what Gladwell contends is an age of information overload, he finds that experts often make better decisions with snap judgments than they do with volumes of analysis. He also mentions that sometimes having too much information can interfere with the accuracy of a judgment, or a doctor’s diagnosis. This is commonly called Analysis paralysis.

The challenge is to sift through and focus on only the most critical information to make a decision. The other information may be irrelevant and confusing to the decision maker. Collecting more and more information, in most cases, just reinforces our judgment but does not help to make it more accurate.”

The book argues that intuitive judgment is developed by experience, training, and knowledge. Travelers thin-slice every time they choose to hire a tuk-tuk, accept a gift from a local, or share a drink with new friends.

Mystic Connection with Nature

Steven R. Covey wrote that “[e]very human has four endowments- self awareness, conscience, independent will and creative imagination. These give us the ultimate human freedom… The power to choose, to respond, to change.” Further, he shares that “[t]he way we see the problem is the problem.”

It follows then that with an awareness of the true nature of universal timeless principles, we can alter reality. As a traveler, you are frequently vulnerable. We can choose to see power in this vulnerability or we can find weakness. Specifically, vulnerability exposes us to scams, theft, and crime. Vulnerability also inspires a heightened sense of awareness and curiosity that helps us embody true “presence” or appreciation or our surroundings.

Super Human Hops

As a traveler you are often faced with unique situations leaving few resources at your disposal. Even the best planned itinerary can result in flight cancellations, unexpected bus delays, or an unforeseen arrival during a regional celebration or workforce strike.

Finding solutions to travel surprises expands confidence in out-of-the-box thinking, and reinforces creative problem solving skills.

Having the confidence to hurdle over unexpected challenges makes the difference between an average worker and an exceptional team contributor.

Stomp Out Insecurity

Until your team feels trusted, understood, valued, and enabled, synergistic results will remain elusive.

Insecurity is that feeling inside us that prevents us from becoming deeply empathic listeners. If we are to cultivate empowered teams which operate over the foundation of high trust relationships, deliver passionate contributions, and produce synergistic results – insecurity must be at a minimum.

Through an exposure to foreign religions, manners, and cultural norms we naturally gain an appreciation for varied cultural views. This appreciation shifts the fulcrum allowing increased understanding and reduced fear. By eliminating fear we can stomp out insecurity.

Multiple Perspectives

As mentioned earlier, empathic listening is critical to success in an interdependent reality. To achieve empathic communication at least one party must be engaged in seeing reality from multiple perspectives. It is only by reflecting content and feeling, accurately and completely, that communication barriers are replaced with profound understanding. Having awareness and being centered in compassion are the first two requirements for such understanding.

Travel long enough and you will eventually find yourself a sleep-deprived, under-fed traveler whose fate depends on the services of an under-paid, under-appreciated, and under-educated world citizen. In these scenarios, empathic communication will often make the difference between a seat on a train, a room in a hostel, or a bite to eat and utter frustration. Through necessity travelers develop empathic listening skills.

In the end, travel creates executives equipped to achieve synergistic results through heightened awareness, empathic communication, and out-of-the-box thinking. With practice, these individuals can be shown to make quality decisions given limited information. Now that’s a leader worth hiring!

Matthew K. Sharp is the co-founder of Inertia Interrupted and is currently trekking, volunteering, diving and photographing the world with his wife, Luz.  You can connect with him on Facebook and follow him on Twitter.

Gap Year: Congrats! You’re Accepted to College, Now Go Away

Anthony of FY Comments:  ” So, Take a Gap Year at 18 years old.  Retirement at 65 years old.  What about the 47 years in between ?  FREEDOM YEAR is the answer.  Age 25 – 40, 50, whatever.  I’m just saying that it is ridiculous to wait 47 years to dream, explore, travel, discover, and learn how the rest of the world really works.

Travel makes Americans nervous, and we are suspicious of other cultures,” Rogers said. “But I think that’s changing and evolving, especially this generation, which is exploring the world more.”  —  Julia Rogers, director of Vermont-based EnRoute Consulting.

My theory is that students who have an opportunity to get off the treadmill do better.” —Robert Clagett, who has worked in admissions for both Harvard University and Middlebury Collegefor three decades, is a passionate convert.

Gap Year: Congrats! You’re Accepted to College, Now Go Away

By SUSAN DONALDSON JAMES | Good Morning America
(GMA Article here)

Gap Year: Congrats! You're Accepted to College, Now Go Away (ABC News)

Sam Helderop received an acceptance letter from Michigan’s Hope College this spring, but has no intention of going — at least not in the fall of 2012.

The college has allowed him to defer his admission, and Helderopwill take a gap year to teach English with the DaLaa project in a remote village in Thailand, then backpack throughout Southeast Asia — “until my money runs out.”

“I always wanted to travel pretty much my entire life,” said Helderop, a graduating senior from Grand Rapids, Mich. “But after 18 years of the same old routine, going to school and sitting in class, I am not motivated enough right not to go through four years of college.”

“I feel like a gap year will narrow down what I want to study and do in my life,” he said. “To get my interest in education back again.”

Helderop’s mother is not happy about his plans to step off the academic ladder and do volunteer work.

But higher education experts say that giving students an opportunity to explore the real world helps them mature. And early research reveals that once they restart their academic studies, they actually perform better than those who go straight from high school to college.

An estimated 1.2 percent of first-time college freshmen take a gap year, most of them male students, according to the Higher Education Research Institute at the University of California Los Angeles.

“These are still small percentages,” said John Pryor, director of the cooperative institutional research program at HERI. But college admission officers say the gap year is gaining momentum.

In Britain and Europe the gap year has been de rigueur for decades, but a 2011 survey of American colleges estimated only about 18,000 of the 1.5 million freshmen had taken a year off after high school.

But now, some of the nation’s most competitive colleges — Harvard, Middlebury and Princeton, among others — have adopted formal policies to allow students to defer their admission.

And public colleges like the University of North Carolina offer a Gappl to pursue academics and service abroad.

“Admission offices tell you is that the gap year increases independence and self-reliance and students have a confidence about them,” said Julia Rogers, director of Vermont-based EnRoute Consulting.

In a persuasive column in the Burlington Free Press, she paraphrases Middlebury’s acceptance letter to those who have asked for a gap year deferment:“Congratulations, you’re in. Now go away.”

Her students have spanned the globe.

Right now, Cindy Li of Chesterbrook, Penn., is interning for a radical art collective in Mexico. Mica Thompson of Cape Elizabeth, Maine, is working on an elephant conservation project in South Africa and Tegan Henderson, an American living in London, is learning fashion alongside designer Stella McCartney.

“We live in an increasingly digital world and are existing more virtually than before,” said Rogers. “The gap year forces them into a real experience — learning a language on the ground, meeting people, engaging in situations — all of which is becoming more and more rare among their peers.”

The gap year is also an attractive option financially, costing an average of $10,000 to $25,000 compared to college tuitions, which are now upwards of $55,000 a year, according to Rogers.

She is helping Helderop shape his plans pro bono because he mother is not supporting his gap year, and his father died eight years ago.

“Travel makes Americans nervous, and we are suspicious of other cultures,” Rogers said. “But I think that’s changing and evolving, especially this generation, which is exploring the world more.”

For starters, Rogers recommends that gap year students “do good work, be in a safe location and have a local coordinator.”

Helderop estimates his year abroad will cost about $7,000, money he has saved himself through coaching tennis, working at a diner, and even donating plasma to get closer making to his dream a reality.

And a gap year doesn’t have to be overseas.

Alex Galarce from Illinois is volunteering for 10 months with City Year in Chicago. There, he serves as a full-time tutor and mentor to keep students on track for graduation from high school. Next year, he’ll attend New College of Florida.

“Doing City Year is what made me consider being a teacher,” said Galarce, who had no idea what he wanted to study when he graduated from high school last year. “If I hadn’t done a gap year, that would not have been something I was interested in.”

Robert Clagett, who has worked in admissions for both Harvard University and Middlebury Collegefor three decades, is a passionate convert.

While serving as dean of Middlebury College admissions until last year, he and his colleagues did a comparison study of incoming freshmen, and those who began in February — so-called “Febs” — and those who took the regular route and enrolled in the fall.

They controlled for variables like high school credentials, having an affluent background or attending a better high school and Febs not only had higher GPAs, but the positive effects lasted all four years.

Gap Year Freshman May Outperform Their Peers

The results were “startling,” according to Clagett. “And we knew we were on to something here.”

“The best predictor of overall academic success was being a Feb,” he said. “My theory is that students who have an opportunity to get off the treadmill do better.”

“The pressures of college admission to get in somewhere wags the educational dog in too many ways in high school,” said Clagett. “And the students who get the brass ring into college step back and say, ‘Where am I now?’ That doesn’t happen as much for Febs, who have had intense experiences or maybe worked.”

Clagett’s research is backed up an Australian study of 2,502 students published in the 2010 Journal of Educational Psychology, which said gap year students are more highly motivated.

“The conventional wisdom is you run the risk of the kid losing hard-earned study skills and, God forbid, they don’t go on to college,” he said. “But those aren’t legitimate concerns. In my 30 years, I have never met a student who took a gap year and regretted it.”

In addition to its 100 Febs, Middlebury accepted 40 students in 2011, who chose to take a gap year — “the highest we ever had,” he said.

One of them, Caroline Cating of Arlington, Mass., has woofed [Worldwide Working on Organic Farms] in Hawaii, learned to fly and worked as a ski instructor. Today, she is volunteering a day care center in Mexico for low-income children of single mothers.

“I absolutely love children, and nothing is so wonderful as making meaningful bonds with them,” she wrote ABCNews.com in an email. “It has also been wonderful to practice my Spanish and learn a new culture.”

Caroline Cating, 19, volunteers at a day care center in Mexico.

For her, a gap year has meant “individual, unmonitored, personal growth.”

“All of my different experiences have helped me learn to be patient and to have faith that things work out, though not always as planned,” said Cating. “I’ve learned to budget for groceries and gas and rent, to navigate new social situations in which there isn’t always a right or wrong answer.”

Chloe Sharples of Austin, Texas, will start Colorado College in the fall after spending a whirlwind year abroad with the full support of her parents.

Today, the 19-year-old is in Chiang Mai, Thailand, volunteering for Art Relief International, after going on a daddy-daughter trip to the remote Himalayan kingdom of Bhutan.

Last fall, she improved her Spanish volunteering in an environmental program with Carpe Diem in Ecuador and Peru.

“College is a choice rather than a path for me: I am going to college truly excited to learn,” she wrote ABCNews.com in an email. “I’ve seen so many amazing things this year and met and learned from so many incredible people and I’ve been so inspired and become so curious about so much that I can’t wait to take courses on all of these amazing subjects.”

Her advice to the nervous parent, like Helderop’s: “Don’t be afraid.”

And to students contemplating a gap year: “Be brave and do things that are outside your comfort zone …(but don’t be dumb). Talk to people, the world has so much to teach.”