At graduation time in December when the champagne bottles are unleashed and the congratulations are said, one factor will inevitably be lurking in the minds of graduates: paying off student loans.

“You have to bust your ass when the time comes,” said David Ptak, a December 1995 graduate of Iowa State with a B.A. in philosophy.

Ptak recently moved to Pittsburgh, where he works full time at a law firm as a quality control analyst.

“I buy things in bulk. I use coupons now. I’ve never had a roommate before and now I have [one]. We’re going dutch on everything, it’s the phone bill, gas bill, all of the amenities of living in an apartment right down to toilet paper,” he said.

Roberta Johnson, assistant director for financial aid at ISU, said a lot of students are victims of their own poor planning in terms of meeting loan payments. “Sometimes they might be hung up in the system or the bureaucracy, but a lot of problems can be avoided if they start planning early.”

“You start panicking,” Ptak said. For Ptak the fear set in his last two semesters.

“You realize what the job market is and then you try and figure out how you’re supposed to come up with all of this cash.”

Timothy Rinkleff, a May 1996 graduate of Iowa State, resides in Burlington, Iowa, and is employed as an engineer for a steam turbine manufacturer.

“I haven’t started paying back my loans yet, but I’m anticipating that it will be do-able,” he said.

Rinkleff said he has a decent job and thinks it will pay enough to pay back his loans. “That’s why I stuck with engineering for the last couple of years because I realized that it is going to be a problem.”

Johnson said it is obvious that some careers pay more and the government-funded Direct Loan Program recognizes this.

“Let’s look at an example: someone who wants to be a kindergarten teacher versus somebody who is going to be an engineer. It costs you both the same amount of money to get through ISU. You probably borrow the same amount of money. But your income potential after you graduate is going to be vastly different,” she said.

Johnson said the income contingent repayment plan, one of four options for repayment, was implemented to encourage students to go into fields that are generally lower paying.

Although it sounds practical, some students think the income contingent plan sounds too good to be true and with solid reason. For example, a student who initially borrows $2,500 and makes $15,000 annually will end up repaying $3,785. This is almost $1,000 more than what a student would pay on the standard repayment plan, according to the Direct Loan Repayment book.

“When you do the income contingent plan sometimes you end up paying almost the principle amount of the loan in interest,” said Kara Sjoblom, a December 1995 ISU graduate.

“I don’t want to do that. I’d rather struggle with making the payments now than pay that much in interest that I can’t afford to pay.”

Sjoblom, who is in Los Angeles doing field publicity and promotions for Orion pictures, chose the common option for repayment.

“It’s really tough to pay my rent and buy food and do the things that I need to do. I have to have nice clothes for work and then still come up with all of this loan money every month.”

Living in L.A., Sjoblom finds the cost of living “…phenomenally high. If I were living in Des Moines what I would have for the amount of money that I’m paying right now would be much nicer than where I’m living.”

Andrew Moore, a May 1995 graduate of Iowa State with a double major in political science and English, began work in a field that was not in his future plans. After working at Parks Library during his six-month grace period from loan repayment, Moore became a cook for Theta Chi fraternity in Ames.

“This fraternity job just fell in my lap and I thought, ‘I’m going to be making $200 a week with free room and board and free laundry,” Moore said.

“So I had basically no expenses and making $800 a month made it a lot easier to pay my $123.50 a month of student loan repayments back.

What if Moore had had problems paying back $123.50 a month?

Financial Director Roberta Johnson explained the assistance her program offers. “The counseling materials provided by the Direct Loan Program explains to students that there is a toll free telephone number at the department of education that they can call. There is no reason for them not to call if they have problems about their student loans.”

Johnson said the worst-case scenario would be for students to go into a default situation with their loans. “It’s a very negative situation.”

He said the consequences include not getting a choice in the repayment option and losing any deferment options that were available.

The list of negative consequences are endless in a default situation.

“Credit ratings are damaged. You can lose federal employment opportunities. You can lose your tax refunds. It’s pretty terrible and so we really want to help students to understand that not paying is not going to get you out of this loan,” Johnson said.

Unfortunately for Rinkleff, the engineer, preparation still did not prevent him from going into default.

“I’m technically in default and I have been there since January.”

Rinkleff was enrolled as a student for six years. When the end of his four years arrived, loan companies began processing his repayment plan.

“The credit companies say the date is past and they never called the school to see if I was still enrolled,” Rinkleff said.

Although Rinkleff has the funds to pay his loans, he is still technically considered to be in default.

“It made a nightmare for me as an engineering student during my last semester. I was busy and the last thing I wanted to do at the end of the day was spend half an hour on the phone trying to clear up what I thought had already been cleared up,” Rinkleff said.

Rinkleff serves as living proof that getting a high-paying job still does not solve repaying loans. Others are finding their own solutions.

Moore decided to focus on his career by enrolling in graduate school at the University of New Orleans after a six month stint at Theta Chi.

“I just took everything into consideration. Was I going to find a real job and still have to pay my loans? It was more an issue of what type of job did I want in the future.”

Moore wants to become a screenwriter.

“The reasons I went into grad school were to literally buy myself more time to write. Because working at a 40-hour job, I wouldn’t have a lot of time to write, and also my student loan could get deferred.”

Sjoblom hopes to enroll in graduate school but more for her career than anything.

“I’m applying to a graduate school which may affect my loan status in the future.”

More school, of course, means substantially more loans that Sjoblom will have to incur. “I just don’t want to be paying for it for the rest of my life. When it is the year 2003 and I’m still writing out checks for something I was done with years ago, it’s going to be a lot harder.”

Johnson recently finished paying her student loans for her master’s program.

“You don’t even think that 10 years is a long time. In the time that it took me to pay off my student loan I had a little girl who went from being an infant … to an eight-year-old,” Johnson said.

The next 10 years for Ptak will be a time of unsettlement as far as loans are concerned.

“There is always a monkey on my back. It always feels that if I’m willing to make a big purchase, I can’t, or if I do, I’m always in perpetual fear of not being able to pay off that expense.”