Personal Finance: Debt heartbreak

Michelle Singletary
Thursday, October 7, 2010; 2:06 PM

Dating can be complicated for anyone. But for one guy trying to find Ms. Right when his debt qualifies him as Mr. Wrong, it has been particularly heartbreaking.

In a letter to a relationship expert for Turner Broadcasting's, a Chicago man wanted advice on when during courtship he should broach the topic of his $190,000 in student loans (and no, he says, he's not a doctor or lawyer).

"I am ashamed and embarrassed to be burdened by such student debt, and I can't help but feel most women would be scared off by it," the guys says. Furthermore, he writes, "I can't bear the prospect of getting close to someone only to scare her off because of my debt. I feel like a leper. But, am I overreacting?"

Columnist Wendy Atterberry gives much of the same advice I would. She tells him yes, there are going to be women who will run and run fast when learning about his debt load. But he's not necessarily destined to a life of solitude and loneliness because of it.

"Look, I'm not going to lie to you; there are certainly people out there for whom your debt would be a deal breaker, but that doesn't mean it's a deal breaker for everyone," Atterberry writes. "There are far worse things to be saddled with than a lot of debt."

I also agree with Atterberry that you don't need to share your financial business with people you are just getting to know.

"Certainly, before you, say, propose marriage you'd want to disclose that information about yourself," she says. "But it's not something that has to be shared early on."

But let's say he does get serious with someone, would it be right for that person to walk out when faced with a mate with that amount of debt? It might be easy to say love should overcome any debt. But you can't pay your bills with love.

Have you ever been in a relationship where you or your significant had a lot of debt? How did or didn't you deal with it? Send your responses to and put 'Debt Breaker' in the subject line.

Pulling Back

Paying for their children's college education has become more challenging for an increasing number of families, according to a recent Gallup Poll.

Post writer Ylan Q. Mui reports that the percentage of families who planned to make little or no contribution to tuition has increased. And as expected given the bleak economy, many families said they just can't afford to help pay for college.

But you can't beat hope.

Despite not having much money, saving for college remained a top priority for many families. Mui reports that on average, families have saved about $28,000 to pay for college. About 12 percent of that money is in 529 plans, while 14 percent comes from general savings accounts or certificates of deposit. Another 21 percent comes from investments, but the largest portion of that money - 23 percent - is in retirement savings.

The New Community College

Once regarded as the 13th grade, community colleges have become a break out force in higher education because of their affordability and growing academic initiatives.

President Obama called the nation's community colleges "the unsung heroes of America's education system," reports Daniel de Vise.

Obama made that statement at the first White House Summit on Community Colleges. It was "a rare moment in the national spotlight for an oft-neglected sector of higher education," de Vise writes.

"I think this will get us into the national conversation in a much more visible way," said Charlene Dukes, president of Prince George's Community College.

I hope Dukes is right. As Obama pointed out during the summit, community colleges represent the largest and most affordable sector of higher education.

The Other Plastic

Generally, debit cards are a much better alternative to credit cards. But when you use a new type of plastic being offered by a company called Higher One, you still have to be careful.

As Ylan Q. Mui reported, recently many student across the country received an offer for a new type of debt card that would allow them to access money from their college loans to spend everywhere from the bookstore to the bar with the swipe of a card. Students often take out college loans worth more than the cost of tuition so they can pay for books, housing and living expenses. Schools are responsible for distributing the difference.

So here's how the loan debit card works. The money left over after tuition is loaded onto the debit cards. It allows colleges to cut down on lengthy refund check lines and it gives students access to their money faster. But the convenience comes with a price.

The charges for this card include an activation fee, a fee for ATM withdrawals and a fee if the card isn't used enough. There's even 50-cent charge for using a PIN to make a purchase rather than a signature. I certainly have a problem with the fees. But more importantly, I dislike how easy this makes it for students to put themselves further in debt with the swipe of a card.

Responses to Rich Man, Poor Man

For last week's Color of Money Question, I wanted to know, "How concerned are you about the growing gap between the rich and poor?" Recent data released by the Census Bureau shows the gap between the rich a poor is widening.

Here are some of your comments:

"I am not at all concerned about the gap between rich and poor," says Shira Newman of Atlanta, Ga. "Why should we be? We are all doing pretty darn well. Our standard of living has increased by so much; people have very nice cellphones, several bathrooms in their houses, internet connections, etc. Who cares about the gap? It's much worse in many European countries - and see how their economies are going. They can't fund the programs they want to have because they are unsustainable."

Don Masterson of Burke, Va., believes education is key to closing the gap.

"The growing gap should worry all of us," he wrote. "And given the poor state of affairs in too many urban schools, the gap is only going to get worse. I have a Bachelors of Science from Syracuse and a Masters from Yale. Following family problems and a major career change in 2001, and with both my wife and I working full-time jobs, we have been among those families that are one paycheck away from a crisis. What opportunity do young kids with a failed education have?"

While the gap between the rich and poor is a concern, the definition of rich as being those who earn more than $100,000 doesn't make sense to Valerie Lane of Fairfax, Calif.

"I don't think you can make a blanket statement that people who make over a certain amount are rich without taking into consideration where they live and the cost of living there," Lane said.

"The greed of the wealthy and lack of consideration for the disadvantaged has become alarming," said Albert Tindall in Dallas. "That Republicans can get support for extending tax breaks for those earning over $250,000 when the country is so much in debt and large numbers are either unemployed or underemployed is shameful."

Upcoming Events

--Thursday, October 21 at 9 p.m.: Watch CNN's "Almighty Debt: A Black in America Special," hosted by Soledad O'Brien. Here's a trailer of the program. Following the documentary is a panel discussion at 10:30 p.m. I taped the discussion this week and it was an amazing conversation you won't want to miss with the well-known and wonderful Bishop T.D. Jakes; DeForest B. Soaries Jr., the senior pastor of First Baptist Church of Lincoln Gardens in Somerset, N.J. (the church is doing some great things to help members get out of debt); Terri Williams, author of "Black Pain: It Just Looks Like We're Not Hurting;" and Cornell Belcher, a top Democratic pollster.

--Thursday, November 4: I will be facilitating the Money Madness session at the Essence Women's Conference located in New York City at the Marriott Marquis. For registration and ticket information, go to

Tia Lewis contributed to this e-letter.

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