Minimum Wage is Different for College Grads

I figure that you should never go more into student debt than you will make in at your first job, in your first year out of school. In other words, never go more into student debt than your first annual salary will be. Even then, the debt burden is large. And college grads have to make more to account for their debt payments.

The process of paying for school looks very different for those who are burdened with the debt themselves. Student loan payments end up being a 10-25 year commitment that will continually garnish some of our wages. Yes, "garnish."

Thinking of student debt as wage garnishment is a little different. I refer to it this way because it is a mandatory cost to get the wages and jobs that will help us pay these debts. Every month, a bill comes that takes away a percentage of a paycheck, which was a cost to get that paycheck.

If a student graduates with an average starting salary of around $30,000 per year, their likely base living expenses before food, gas, fun, and car, are likely to be around 60-70% of that amount. Just rent, utilities, taxes, and insurance (of all kinds) will consume $18,000-$21,000 of their gross income. That leaves roughly $9,000 per year for food, fun, car, and student loan payments.

For the student who is paying their student loans on their own, they're not left with much. Sure, you could feed a family in Africa for like a decade on the $9,000 per year leftover, but you sure aren't going to be eating much in America on that little money. Especially with car repairs, food, dates, and student loans coming out of the same pot.

The point is that there is a new minimum wage that most don't recognize -- it's the minimum wage for a college graduate. College graduates bearing a student debt burden have to make more out of the gate to compensate for the debt payments.

The college grad minimum wage is the amount it costs to live a healthy life in addition to student loan payments. The thing is, we're all supposed to be saving to buy a houses, too. And our cars are wearing out. And we need new clothes to be professional, too.

Incomes after school have to be higher to compensate for the cost of schooling. And let's be honest -- a college grad shouldn't be eating ramen for years after school while paying off debts. For those who are, college has failed them and left them worse off than if they had skipped it all together.

The creation of this new breed of low-paid, post-graduate that can barely afford to live well with their debt burdens is nasty. We're creating drones to pay student loans -- Student Loan Drones. And it's not good. Someone with a college degree needs extra pay right out of the gate to pay off their loans. I also think we all went to college so we could live better, faster, and for longer -- yet we're burdened with these toxic debts that completely garnish our wages for decades after school. The system is broken.