Creditland Exclusive: 80k School Debt and Starting a Business: Life of the 21st Century Artist

This interview with a graduate of Minneapolis College of Art and Design was conducted via gChat on Wednesday, November 25, 2009, Thanksgiving Eve.

7:55 PM
Creditland: So, you attended a very well respected art school in Minnesota. Which one and how much did it cost the years you went there?
80k School Debt: 21,000 a year tuition, plus 5,000 for housing. I have about 80,000 in debt right now.
Minneapolis College of Art and Design
Creditland: How much is educational debt specifically?
80k School Debt: around 70,000, but who's counting?

7:59 PM
Creditland: When you applied for college you were presented financing options. Did you do the math and figure out what you total debt would be? Was that information available to you?
80k School Debt: I knew roughly what I was up against, but my mom and dad really did most of the accounting for it. We applied for financial aid through my mom who made less since my parents were already divorced by this time.

I was so focused on going to art school that it was really not a factor to me.

8:00 PM
Creditland: Being accepted was the greater concern then?
80k School Debt: I applied to a few different art institutions as well as a the UofM art department . Yes most definitely.

Creditland: Would it be safe to say the honor of being accepted to a prestigious school overruled any concerns you might have about your financial future?
80k School Debt: Parent plus, Self loans, Perkins, Federal, through Wells Fargo and a few other private lenders.
Yes.

Creditland: Did you feel that the prestige of the institution would position you to take care of whatever debt came of the education?
80k School Debt: I voice one major to concern to my mom that I still remember to this day. I said I don't want to be two years out of college with debt over my eyes depressed living in a shack with a bad job.
Creditland: Wow!
80k School Debt: Yes, I viewed in philosophically. I thought that it was an investment into my future and that I could not be sure what was possible and so it seamed silly to judge my ability before I had any.

8:05 PM
Creditland: So you felt to assume you wouldn't be able to cover the debt was pre-judging yourself a failure?
80k School Debt: Well put.
Creditland: Did you or do you envision a scenario where you are in this position - to really attack 80K in debt?
80k School Debt: Yes. I am focused on paying off my debt in full as fast as I possibly can. Many say, well you should invest money in the market before throwing it into federal debt which has possibly lower interest rates than the market but I rather just pay it all of quickly.

8:08 PM
Creditland: You are now a freelance artist and you are making money on a contract basis, is that correct?
80k School Debt: Yes. I stared a company called that designs custom, environmentally friendly housing. We make luxury treehouses.

8:11 PM
Creditland: You've negotiated a monthly payment on your debt?
80k School Debt: Yes. Right now I pay roughly $800 a month.
Creditland: Do you know how much of that pays down your principal?
80k School Debt: No. Not Much
Creditland: For a freelancer working on contracts, this is a hefty regular expense.
80k School Debt: Yes, often in place of rent, which is something that I sacrifice so that I can save money and have more freedom to pursue interested of the company and my work.

8:13 PM
Creditland: Where do you live?
80k School Debt: I am currently living in Mar Vista, CA.
I live in the back of a community house owned by an eccentric burner style business man.
Creditland: So it's low rent...
80k School Debt: I am currently living in a 14' icosahedron tent made of used billboards with my right hand man JP.
Yes, it is currently free rent. We have worked out a design services rent trade.
Creditland: So you're living in your product, kudos to you!
80k School Debt: I have not paid rent in CA for a total of about 18 months out of 24 since I've been in LA.

8:16PM
Creditland: How does this debt payment change your outlook?
Do you weigh it against your education and wonder which has more value?
Does it hinder your business game? Or is your college education as much as you need?
Clearly you have done well with the living arrangements and connections.
80k School Debt: I would do it all over again. My experience at MCAD was incredible. I cannot speak highly enough about it.
I really got the most out of my education there.
I speak to many people who are very bitter about their experience.

8:18 PM
Creditland: Is there anything in retrospect that you wish someone would have told you?
You are currently several years into this debt and it will last a long time.
80k School Debt: Yes. I'm not sure if any of it would have helped me but a class on debt management would have been extremely valuable to me.
I am inherently bad with paper work and keeping after these things.
I feel a little thrown to the wolves with my debt.
I feel most expect you to just understand the best practice to manage your student loans but I feel I was always in the dark on it.

8:22 PM
Creditland: In many ways artists are first running a business.
80k School Debt: Yes
Creditland: And to have debt is now part of your business.
It affects your business.
80k School Debt: I guess the best answer to this is make a tonne of money so you can pay them off easily every month. As you know this does not happen though..
Yes, it affects my business.

8:24 PM
Creditland: But the way the financing of your education was done, it seems like that would be the expectation.
How else to manage 80K in debt but to become a celebrated artist?
80k School Debt: Yes, I basically funded my business by not paying my loans.
If I would have taken a more conservative responsible route I never would have been able to pull off what I have achieve with my business.
It may have worked other ways but it would have taken twice as long.
This is the dirty secret of my company.

8:28 PM
Creditland: It may not be the first thing an art institution or education institution wants people to think about - how the debt will play out against your personal business.
80k School Debt: I sacrificed my personal credit in order to pursue my dream.
I don't know how everyone else pulls it off. All I know is that it is very difficult.
Creditland: Creditland is working to find that out.