Should I take out student loans or work through college?

Question

Rich Dad · Accepted Answer

Student loans aren’t evil — but being financially unconscious is.
Let me be blunt: the question isn’t "Should I take loans or work?" The real question is "Will this decision increase or decrease my lifetime earning power?" If a $40,000 loan helps you graduate faster, land a $80,000/year job instead of a $45,000 one, and start investing 3–4 years earlier, that loan could be the cheapest leverage you’ll ever use. That’s not debt — that’s fuel. But if you’re borrowing $120,000 for a degree that pays $50,000 a year? That’s not leverage. That’s an anchor.
Let’s talk numbers. Suppose working 30 hours a week slows your graduation by two years. If your post-grad earning potential is $70,000 annually, that’s $140,000 in delayed income. Meanwhile, the interest on a $40,000 loan at 5% over four years is roughly $4,000–$6,000 during school. See the math? Sometimes time is more expensive than interest. High performers use debt strategically — like entrepreneurs use capital to grow a company.
But here’s the twist most people miss: the real asset isn’t the degree — it’s your skills and network. If working means you’re building relevant experience — internships in tech, finance, healthcare, engineering — that’s gold. A marketing student running paid ad campaigns for local businesses can graduate with a portfolio and clients. That student doesn’t need a resume; they have revenue proof. In that case, work beats loans.
However, if your job is pouring coffee 25 hours a week just to avoid debt, and it drains your energy so your grades suffer, that’s penny-wise and pound-foolish. You’re trading long-term income for short-term safety. The wealthy don’t avoid debt — they avoid bad debt. A 6% federal loan for a high-income skill is different from 24% credit card debt for spring break.
Now, counterpoint: loans can become psychological shackles. I’ve seen graduates with $90,000 in debt take safe corporate jobs they hate because they’re afraid to take risks. Debt can shrink your courage if you’re not mentally strong. So if you know that owing money will paralyze you, maybe working more is the better play.
Here’s my aggressive-but-calculated advice: minimize debt, don’t eliminate it blindly. Work strategically — internships, high-value experience — not just survival jobs. Borrow only what directly increases your earning capacity. Graduate fast. Enter the market strong. And start investing within 12 months of earning.
Debt used to build income is leverage; debt used to buy comfort is slavery.

Poor Dad · Answer

Debt may feel normal these days, but owing money is still owing money.
I understand the temptation to take out loans and "focus on school," but please be careful. Student loans are not like other debt — they are very difficult to discharge, even in bankruptcy. If you borrow $60,000 at 6% interest on a standard 10-year repayment plan, you could be paying around $666 per month. That’s like having a car payment before you even buy a car. Think about how that will affect your ability to rent an apartment, save for a home, or contribute to your retirement.
Working through college has benefits beyond just avoiding debt. It teaches discipline, time management, and real-world responsibility. Many employers value candidates who worked part-time while maintaining solid grades. Even working 15–20 hours a week can significantly reduce how much you borrow. If you earn $12,000 per year part-time and apply it toward tuition, over four years that’s nearly $50,000 less debt — not counting avoided interest.
However, I’ll admit something important: working too much can harm your academic performance. If your grades fall and you lose scholarship eligibility, or if it takes you an extra year to graduate, that can offset the savings. For example, one extra year of tuition and living expenses could cost $20,000–$30,000. So balance is key. Your primary job during college is to succeed academically.
You must also consider your field of study. If you are pursuing nursing, engineering, or accounting — careers with strong, stable demand — moderate loans may be manageable because starting salaries often range from $60,000–$80,000. But if you are entering a lower-paying or uncertain field, large loans become very risky. A general rule I like is this: do not borrow more than your expected first year’s salary.
There are middle paths. Community college for two years can reduce total costs dramatically. Living at home can cut expenses by thousands per year. Applying aggressively for scholarships — even small $1,000 awards — adds up. Every dollar not borrowed is a dollar that won’t grow with interest.
I am not against education — I believe in it deeply. But I want you to graduate with opportunity, not pressure. Debt limits flexibility. Working builds resilience. Choose stability first, and make sure you can sleep peacefully at night.
It’s easier to build a future when you’re not already paying for the past.

Should I take out student loans or work through college?

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