Back in the day the great James Joyce wrote this book called Finnegan’s Wake. It’s often considered one of the great books of the 20th century. One of the many cool things about this book is that the the books starts in the middle of a sentence, and it ends, you guessed it, with the beginning of that same sentence. So it’s a circle it takes you back in. While Hacking College is no Finnegan’s Wake (ow, that hurt to write) the end of this book also repre- sents a beginning.

There is so much more here — go, explore!

Padded with power here they come
International loan sharks backed by the guns
Of market hungry military profiteers
Whose word is a swamp and whose brow is smeared
With the blood of the poor

Bruce Cockburn

Why yes, I did save the absolute worst option for last, how clever of you to notice. Sadly, it is the option most taken by students.

Picture this: My friend and former student Adam is in a jam. He is stuck at school between summer and fall semester and he is broke. Come fall, he will be rolling in cash but, at the moment, he is broke in a college town where there are few job prospects. He has called me for advice. Actually he has called me because he knows I have great student loan contacts but we pretend it’s the advice he wants at first.

After dispensing some advice, I dutifully talk to a friend whose company sells student loans. There is a brief moment of hope, but it fades within a few sentences. Considering his options, I finally sigh and say to my student-loan friend, “I think he needs a credit card.”

“You, of all people, want to give a nineteen year old a credit card?” my friend replies in horror.

“Well,” I explain, understanding her mixture of reservation and shock, “he is twenty-one and if he can find a card that will give him 0% for 6 months, he can put everything he needs to survive on the card for a few months and then pay it off with an additional student loan in the fall. I’m not saying this is the optimum solution, but given his current situation, what other real choices does he have?” (Long heart aching pause on both ends of the phone.)

Don’t ever let this be you. Go back and read the bit about being your own bank just a few pages back. That’s a lot of what I told Adam that sad, sad day. But let’s talk about credit cards . . .

To understand student loans, it is first necessary to understand FFELP. The Federal Family Education Loan Program (FFELP) is “authorized by the Higher Education Act to help students and their parents pay for the cost of higher education.” The key word in this sentence is “help.”

As of 2010, a student loan is a direct loan from the government. Student loan debt is perhaps the hardest form of debt to have forgiven. Unless you die, are catastrophically injured, or vanish from the face of the earth, they will make good on the loan. On the upside, FFELP loans have the lowest possible interest rates and have more flexible repayment plans than almost any consumer loans. Highlight this next sentence. They are probably the best loans you will ever get in your life . . .

Financial Aid is what makes a college education possible for most students and this section covers all you need to know. 99% of college-student funding comes from federal and state aid, so it is vitally important that you know and understand what it is and how it can work for you.

Getting Started With Getting Aid

The starting place for all federal aid is the FAFSA or Free Application for Federal Student Aid. Anyone who wants to apply for a student grant or loan from either a school or from the federal government must fill out this application and submit it to the federal government. You can usually get a FAFSA from a high school guidance counselor or the college you are planning to attend. But odds are they are going to first tell you to go to the same website that I am (www.fafsa.ed.gov). You can fill out the entire application via this website. If it is at all possible, I suggest you take advantage of this method of submission for three reasons:

FAFSA applications submitted on the Web are dealt with faster than paper counterparts. FAFSA on the Web only asks the questions you need to answer, so you end up answering fewer questions. FAFSA on the Web checks your answers before your application is submitted, so your application is less likely to be rejected because of missing or conflicting information.

Americans are horrible at saving. We are the worst savers in the world, or at least the industrialized world. On average, Americans save something like four percent of their income. Four percent. The Japanese save something like sixteen percent. As a rule Americans also buy more stuff on credit than people in other nations, mainly because we have no savings. So, we don’t save and then we spend more money than we have on things we often don’t need. This is not a recipe for success in the 21st century.

As you know, the democratization of finance has made you more responsible for your financial well being than the average person in the 20th century ever was. In the 20th century it was common for someone to have one job his or her entire life. One employer and one pension managed by that employer makes things pretty simple. But as you know, that probably won’t be the case for you. Now, if you are fortunate, you may only have employers who allow you to move your retirement plan with you. That would be nice but it still won’t be enough. If you want to live well or decently in your twilight years you are going to have to start saving.

How much should you save? I have a simple rule for this that will make saving very easy. You should save as much as humanly possible. If you really want to gain wealth as you progress through life (and why wouldn’t you?), you need to pay off all your debt and save as much as possible. Remember in grade school when they went on about Benjamin Franklin and “a penny saved is a penny earned?” This adage by the roguish founding father has endured even globalization. Let me add to it though. It’s my nod for immortality: a penny saved for retirement should be put in a Roth IRA. What d’ya think?