This is the seventh installment of our series Into the Black, where we hear from people who found ways to pay off serious debt. This week we talked to Kate*, who decided that paying off her loans from a for-profit art school was more important than pursuing her original goal of working in animation.
Kate*, 25, Redwood City, CA
Past debt: $32,000
Source: Student loans
Past job: Part-time puppeteer at a toy company
Past salary: $15 per hour, working 40 hours per week for three months, followed by three months of unemployment, followed by three months of full-time work (and so on)
Current job: Case analyst at Heartflow Inc.
Current salary: $72,000
Current net worth: $37,000
You might recognize the name of my for-profit college, the Art Institute, because it was sued by the Department of Justice last year for not acting in the financial interests of its students. The school was notorious for pressuring kids to enroll to increase its revenues, saddling students with thousands in debt in exchange for worthless degrees.
The Art Institute sent recruiters to my school and they made it seem normal to take out tens of thousands of dollars in loans — as if that’s just what school costs. If I could do it again, I would have gone to a real art school.
Some kids graduated with $100,000 and none of the requisite skills for their desired field. I wasn’t that unlucky, though. I was only $32,000 in debt when I graduated in 2012. (I’ll admit my parents helped me out a lot. They took care of $55,000 of my loan package.)
My degree was in media arts and animation, and I was excited when I graduated. I thought I’d make $60,000 a year working in mobile gaming, maybe.
I didn’t think much of my loans at the time. I just thought it was part of life. You go to school, take out loans to do it, then get a job to pay them off. And $32,000 seemed like an impossibly big number. I just figured it’d go away over time. (Unfortunately, that’s not how it works.)
Shortly after I graduated, I got a contract gig making animated shorts for a winery. They were making a series of webisodes about this fictional history of the winery, a silly story about a French bulldog conquering a tract of land and turning it into a vineyard.
The agreement was to pay me $100 per 1–3-minute episode, but I ended up being grossly underpaid for the project. The client made it seem like they had most of it done and I’d just be adding in some animation, but soon found I had to edit the entire thing. Each episode ended up being 20 hours of work (or $5 per hour). I didn’t know how to negotiate for more money, though, and I just kind of let it happen.
I got a second job working permalance (i.e., working 40 hours a week in a freelance capacity) at a toy company, animating the speech movements for one of its puppets. So I’d work a full day at the toy company and come home and animate the winery webisodes. At one point it got to be so much that I offered a friend $50 to animate the webisodes.
The toy company job was three months on, three months off, so I applied to full-time jobs for more stability. I probably applied to 60 jobs between 2012 and 2014.
Fortunately, I wasn’t paying for rent at the time. I was living with my boyfriend, and he had a full-time job and paid the rent ($1,600 a month), and I paid for food. I had very clear boundaries about what I’d let him pay for, though. I never let him pay my loans or my car expenses. I never wanted to feel like I owed him anything.
My social life consisted of playing video games (World of Warcraft, mostly), reading and hanging out with college friends at my place each Friday night. (I don’t party.)
I was paying just the $350 minimum payment on my loans each month. Despite having a full-time job and more debt than me, my boyfriend wasn’t trying to pay down his loans at that point either. Neither were any of my friends I graduated with. It made being in debt seem so normal.
In 2014, I got serious about turning my life around. I started a log of every job I applied for. At first, I’d scour Craigslist, SimplyHired and Jobvite for art and animation jobs, apply to one a day. Soon, I was widening my search to jobs at places like Target because I just really needed a job. My debt was looming over me and I felt anxious.
After about 40 applications, I got a job at Heartflow, a medical device startup. I sent in an application, they called me the next day and I interviewed the day after that. They asked me, “What do you know about our company?” And I said, “Nothing.” I had no time to research.
But the job was similar in process to what I did at the toy company (just more intense). They interviewed me for five hours and offered me the job a week later on my birthday. I got a $62,000 salary and health benefits.
My debt stopped being a distant, floating number the moment I got a full-time job. My first check went to pay off a dental bill. After that, I ironed out living expenses with my then-boyfriend. We decided to split rent and living expenses proportionally by income: I paid 45 percent of the share to his 55.
I put $1,000 toward my debt every month. And since I’m a natural saver, I’d have a couple extra thousand few bucks each month and put that toward my debt, too.
Then I broke up with my now-ex-boyfriend. I still had $10,000 in debt at this point, and I was originally planning to wait until I was debt-free to break up with him. (Rent’s expensive in San Francisco.) But it got to the point where I couldn’t wait anymore. I felt like a jerk using him to pay half my rent and I wasn’t willing to work on the relationship anymore
Luckily, a family friend took me in and let me live for free. For the next few months, all my income went toward debt, and by July 2015, I was debt-free.
I’ve since gotten a raise to to $72,000 per year, saved an emergency fund of $15,000, put $10,000 in my 401k and have a few thousand dollars in cash that I’m looking to invest in index funds.
There was a time where I dreamed of working for Pixar. But the people who work at Pixar animate all day and go home and animate some more for fun, and I’m not sure I ever had that undying passion for art. I was just really good at it my entire life and that’s what people always told me I was born to do. So I did it.
Giving up on my dream probably isn’t the right way to put it. It’s more that I realized that financial stability was more important to me than art. I wasn’t happy not knowing where my next paycheck would come from — I didn’t like the uncertainty.
*Kate requested that we use a pseudonym to protect her privacy.