People understand how living costs can vary dramatically based on where you live in the United States. As I can attest to from firsthand experience, living costs in northeast cities (such as New York City) can be brutal, since rent, food costs, and other expenses are substantial in those areas. However, in more rural parts of the country, the prices for most consumer goods and rent are far lower. Geography can impact student debt, because living in a low-cost area might enable you to devote additional money to student loans.
Attending School in a Low-Cost Area
One often under-looked way how geography can impact student debt is with where you choose to attend school. Tuition and costs at many universities are mostly uniform, and the main difference in costs to attend college or graduate school is if you attend a private or public university. However, sometimes geography can impact student debt because you can live in a lower-cost area as a student and this can affect your bottom line.
For instance, during my first year of law school, I attended Washington and Lee University School of Law in rural Virginia. Although the tuition and fees to attend the school were largely the same as many schools located in cities, the living costs in that area of Virginia were absurdly low. Rent with roommates could often be just several hundred dollars a month, and you did not need to live in a small or dilapidated place to pay only this amount. Food costs were also very low, and I remember paying nearly half my usual cost for chicken and other items at the grocery store in that area. The cost savings extended to restaurants, and eating out or heading to bars was extremely affordable.
When you add up the savings from all of these expenses, you could borrow thousands of dollars less in student loans to cover living costs in a rural area as a student rather than moving to a city. Normally, cost of living is not a major factor in deciding where to attend college and graduate school. However, geography can impact student debt, and students should consider the financial impact of attending college and graduate school in different parts of the country.
Living in a Low-Cost Area After Graduation
Geography can impact student debt after you graduate from school as well. Where you live in the country can have a substantial impact on the discretionary cash you have to devote to student loans. For instance, I lived in one of the priciest areas of the country (the New York City area) when I was repaying student loans. I spent several times more in rent to live in the New York City area than my law school classmates paid at that school in rural Virginia. Food and other costs were also expensive in that area, and I had limited amounts of money at the end of the month to devote to student loans.
However, my friends who lived in other parts of the country paid much less in living costs. Indeed, I had numerous friends in Florida that told me they paid half or less the rent that I paid due to the area in which they lived. I also had friends in Oklahoma and other more rural areas that paid even less for living costs than I paid. Of course, people decide to live in areas of the country for a variety of reasons, like family, a familiarity with the location, and others. Nevertheless, since geography can impact student debt, it makes sense to consider finances and student loans when making decisions about where you should settle down after graduating.
Salaries in Different Parts of the Country
Location alone is not the only consideration to keep in mind when determining how geography can impact student loans. For instance, some jobs pay different salaries to people working in various cities in order to account for the cost of living difference. This makes sense, since workers in different locations are presumably performing similar types of work and should be afforded a roughly similar standard of living notwithstanding the fact that they live in different places. It should be noted that some industries adjust salaries based on location more than others, and teachers, lawyers, and physicians among many professionals can make vastly different sums of money depending on where they live. As a result, individuals need to do their research to fully decide if living in a different area can dramatically impact their bottom line.
Moreover, there are certain jobs that can only be performed in particular areas, and there are locations that are generally conducive to landing a job in a specific field. For instance, many tech companies are based in and around San Francisco, so even if the city has a high standard of living, it might be worth it to live there for the opportunities. As a result, cost alone cannot form the basis of a decision to live in one part of the country over another.
In the end, geography can impact student loans, since it can affect the amount of discretionary income someone has to pay down their debt. However, individuals need to evaluate a number of factors when deciding if living in a certain part of the country to affect their bottom line is worth it in their particular circumstances.