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How Bill Said Bye to Loans

This is Bill. Bill is going to college to major in English. He hopes to be a professor one day.

Bill has done everything right. He maintained a 4.0 average in high school and applied to a bunch of schools until he found a cheap selection in his home state of Colorado. Bill even received a scholarship of $10,000 a year.

Unfortunately, that is all Bill will receive. His parents make just enough money to make him ineligible for Pell Grants but not enough money to save a substantial sum for his education. Even with Bill’s scholarship, he will need to come up with $17,000 a year minimum.

He decides to take out $10,000/year in Stafford loans and work part time as a waiter for the other $7,000. This plan works for him all freshman and sophomore year, but as his course work becomes more difficult he decides to stop waiting tables and to focus exclusively on his education. For the last two years he takes $17,000/year in loans.

Bill officially graduated in 2016 with $54,000 in student debt and no way to pay it back. This is how Bill looks now.

Bill hopes to pay off his loans with his teaching job. But with poor financial management skills he finds himself still in $35,000 of debt at age 32. Finally, at age 42, he pays off his loans and plans to pay for his son’s education. Unfortunately, he is unable to pay for his son’s college and his son ends up taking out the same loans. It seems like his whole family is stuck in an endless cycle of borrowing and debt. They have no chance to get out.

One day, as Bill is walking to lunch, he falls into a time warp in the middle of the sidewalk.

His time warp brought him back to his summer after his freshman year of college. Bill was shocked, but saw his opportunity and immediately set a plan into effect.

He decided not to return to his old alma mater for his sophomore. He had heard about something called “testing out” and began to research the phenomenon. He found a school that allowed him to transfer all of his freshman credits and accepted as many test out credits that he could take that applied to his degree.

Bill started on his journey. He decided to take the CLEP for English Literature to begin the journey. He studied for one week and took the test at a local testing center. This cost him $85 plus $15 additional at his testing center. After a successful first test, Bill dove into a series of test out credits.

-10 CLEP Tests. Bill received 30 credits and paid $1,000

-5 DSST Exams. Bill received 15 credits and paid $475

-5 Uexcel Exams. Bill received 15 credits and paid $625

-15 FEMA tests. Bill received 15 credits and paid $0.

Bill had a lot of fun with these tests. But due to certain requirements in his degree program, he had to take some online courses in order to finish his degree. He didn’t want to take these courses from the school, as the price was still drastically higher than alternative methods. Bill took 3 courses from an online program called Penn Foster.

-3 Penn Foster courses. Bill received 9 credits and paid $600.

Bill was required by the university he was “attending” to take two online courses from them. This turned out to be the most expensive.

-6 credits required online. Bill received 6 credits and paid $2,000.

Adding in all of Bill’s credits from his freshman year, he was able to graduate.

-30 credits from freshman year (traditional). $27,000. Bill ended up taking a $10,000 loan.


Bill changed his life

Bill graduated with a Bachelor’s degree from a regionally accredited university. Instead of being in $54,000 of debt like he was pre time warp, Bill was now only in $10,000 due to his unfortunate freshman year.

Let’s look at the numbers:

Pre time warp

  • Total cost of education without scholarships=$108,000
  • Total cost with scholarships=$68,000
  • Total out-of-pocket cost with loans=$14,000
  • Total time taken=4 years
  • Total loan debt=$54,000

Post time warp

  • Total cost of education (not including freshman year)=$4,700
  • Total cost of education (without scholarships, including freshman)=$31,700
  • Total time taken=2 years
  • Total loan debt=$10,000


Bill was able to pay off these loans by age 26. Bill now felt like this again.

Bill now recommends testing out to all young students as a way to overcome debt.



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