Is it justifiable to borrow money for educational purposes?

Answer/Brother Joe J. Christensen

For many years the General Authorities of the Church have counseled the membership to avoid debt. In this era of easy credit and rapid proliferation of credit cards with which one can buy everything from a haircut to a color television set, the temptation to go into debt is greater than ever. Certainly excessive personal debt can be devastating.

However, Church leaders have also recognized the value of good investments and the advisability of borrowing money for legitimate reasons.

President David O. McKay once wrote the following about money management and borrowing for investments:

“A great lesson in life is to learn to spend less than we earn. It is surprising how much success depends upon that little practice and how quickly failure can come in business, or to an individual who spends more than he earns. I am not referring now to investments—investments in education, investments in property. I am referring to unwise expenditures.” (Treasures of Life, pp. 194–95.)

If you need to borrow money for an education, here are a few principles that you should keep in mind:

1. Loans should not replace personal or family responsibilities, nor take the place of part-time work.

2. Try to borrow no more than absolutely necessary.

3. Attempt to procure loans at the lowest interest rate available.

There are many financial institutions that operate through colleges and universities. There are private and public funds designed specifically to help students in need. Some loans for education are interest-free for a few months and then charge a lower rate afterwards. For more information about what is available, check with the office of student financial aid at the school, college, or university you wish to attend.

Naturally a person should do all he can to procure his education on a pay-as-you-go basis. However, if this is impossible, an individual who cannot afford the immediate costs of education may be very wise to obtain a loan, if it means the difference of completing the training or not. For students in the United States, for example, studies show that it is not uncommon that the return on an investment in education beyond high school could enable one to receive at least $200,000 in additional income during a lifetime of work. In anyone’s book that’s a good return for one’s time, effort, and money.