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For a Living Wage

I find the idea that saving money is all about having the right "financial mindset" absolutely absurd. Isn't saving money also about not having family to support? Isn't it also about not having medical emergencies that aren't covered by your insurance? Isn't it also about not having your identity stolen and being robbed of all your possessions at gunpoint?

Sure, if you want to save some money, apply for fellowships and cook your own food when possible. But let's not forget that, for everyone with 'good habits' who ends up saving money, there are plenty of people with 'good habits' who, as a result of factors far out of their control (but within our control as a society that sets policy priorities), end up in deep debt.

How about we focus on unionizing grad students and raising stipends above 15k (!) so grad students don't have to conduct 'frugal experiments' to avoid starvation?

Trevor Hedberg

"For a Living Wage" -- I don't think either Emily or I say in the interview that having a proper financial mindset is a sufficient condition for saving money. In fact, at the end of the interview, I highlight several factors outside my control that made my savings possible, such as Knoxville's low cost of living and Tennessee's lack of a state income tax. But I think for most people a deliberate and conscientious approach to financial decision-making will help them manage their limited income better than they otherwise would.

I'd certainly be in favor of raising graduate student income and generally making their circumstances more bearable. Unfortunately, most current and future graduate students will not have the power to affect large-scale policy changes of this sort. Some of them will have to make due with poverty-level wages while they complete their graduate studies, and I think it's worth considering what they can do to make their money go further. As you note, there is an intractable element of financial risk involved -- the main financial loss I took early in grad school was my car getting totaled in an anomalous hailstorm, something that was certainly outside my control. Still, some steps can be taken to reduce these risks or lower their impact when something like this happens. The financial challenges tied to graduate studies are also something that should be taken into account when people are deliberating about whether to go to graduate school in the first place. I often worry that they are not given adequate weight in the deliberative process of prospective grad students.

Marcus Arvan

I don't think Trevor's interview is at all inconsistent with thinking that there's a whole heck of a lot wrong with people not making a living wage, etc. What I *do* think is that he's absolutely right that having the right financial habits can make a (big) difference for people who are struggling with finances. I should know: I'm someone who ended up in immense debt from graduate school - both student loan debt and credit card debt. I was in so much debt, in fact, that I was in a near-constant panic about my financial situation. Only 3 years later, however, I got myself completely out of debt. How? Through a decently good paying job and a *lot* of better financial habits, which my wife and I researched (such as always making coffee and lunch at home, using coupons and cash-back purchases at CVS, only buying 'buy-one, get-one' deals at the grocery store, buying a $1000 heap of junk car, etc.). At one point, my wife and I were routinely getting $60+ worth of essential goods at CVS (soap, toilet paper, etc.) for (I kid you not) a total of 4 to 5 dollars.

By all means, let's push for better social and economic conditions, including a living wage. But let's not blame people for giving sound financial advice. It can make a huge difference, especially for those who don't make much money (example: I can't begin to tell you how many times my mother made a $1 can of tuna fish, pasta, etc., stretch into full meals when buying pre-packaged food at the story would cost 5x as much for a family struggling with money). Good financial habits are good for everyone, especially those who don't have much money to go around.

Alex B.

Thanks for this interview Trevor. One thing I don't see addressed here that I would be interested to hear more about is the prospect of long-term financial security. For example, while the received wisdom regarding retirement savings suggests one ought to aim to begin significant retirement savings during their early 20's (about $10,000 per year) that level of savings doesn't seem possible for PhD students on the income described (and for most Philosophy PhD students). I'm a worried about the long term ramifications of living on this kind of income for years before making serious retirement contributions, as the contributions required to catch up would be significant.

Marcus Arvan

Hey Alex: This is a real issue, and it can be difficult to catch up, particularly if one does not obtain full-time employment. However, if one does obtain full-time employment, then (depending on one's situation) it can be possible to catch up. I finished my PhD at the age of 32 with nearly $70K worth of debt, a substantial portion of which was high-interest credit card debt. Once I got my first FT faculty job, I was able to eliminate my debt through extreme cost-cutting in about 3 years. I am now 44, entirely debt free, and have for the past 9 years or so maxed out my 401K (which has university-matched contributions) and Roth IRA. I won't say how much I have saved (which I think would be tasteless), but I will say that I should have enough to retire in old-age. Of course, it's also relevant to note here that I do have a spouse (who, however, was also an underemployed PhD student for most of our marriage), and that we have deliberately chosen not to have children in part for financial reasons--but the point is that, depending on one's situation, it's possible to begin saving later in life (post-PhD) and save enough to retire.

Alex B.

Marcus: This really gives me hope, thank you :) Would be a keen reader if ever you were to be interviewed about this!

Peter Furlong

I just wanted to chime in both to thank Trevor for sharing this sort of information and to agree with both him and Marcus that changing financial habits and mindsets can make a big difference (even if, as the first poster noted, there are larger issues that deserve attention). Also, in response to another post, I will say that I feel confident that I will be able to invest enough to retire (for background, I have been out of grad school since 2013 and at this point, in addition to the school's sponsored 403b, we max out IRA for both spouses and will likely do more very soon). Of course, what counts as "enough to retire" depends, in part, on one's habits and mindset. What I consider "enough," you might consider peanuts. We still live on far less than what many of our friends do, and that is what allows us to save anything. Financial considerations do not fall away after grad school, and our situation is very different than what it would have been if I had pursued a different career. Just for further background, I live in a low cost of living area (2% under average for the US), and my job is very far from prestigious. I also have three kids, and my wife has chosen to stay home with them (although she did work for a few years while I was in grad school). To make up a little for having a single income, I tend teach over the summer (and sometimes teach overloads during ordinary semesters). All situations are different, of course, and even a relatively small difference in salary, cost of living, or family circumstance could result in a significantly different picture, to say nothing of medical emergencies. I am not shy about sharing numbers--I think reticence in doing so sometimes hinders our ability to plan for the future or consider other options--but I will follow Marcus in not doing so here. I would recommend that grad students reach out to others they know to honestly discuss finances in an open way. It is important to know what you are getting into, supposing you are lucky enough to get a permanent gig. If anyone out there wants to talk openly about numbers, but has nobody who is willing to do so, I would be happy to share. Just shoot me an email and we can discuss it (with a real name--if I am being open, I want to at least know the identity of the person I am talking with).

Marcus Arvan

Alex B.: Thanks for your kind words - I'm glad you found my comment helpful! :)

Now that you mention it, perhaps I'll write a post soon sharing both how I fell into debt and then got out of it. It was definitely an eye-opening experience all around, so perhaps it would be helpful to share in some more detail.


If this is useful for anyone, I made a list of money traps I have experienced in my life as a graduate student and itinerant VAP, before landing a TT job. (Background: grew up lower middle class in the sticks. My family was deep in debt during my teenage years, which eventually led to bankruptcy. This, obviously, had a profound impact on me.)

-Pets. I have a dog that I adopted in graduate school. I just dropped $6k on an emergency spinal surgery. That was the low-end of estimates, so I felt lucky! It was worth it; he's my best friend (sad but true), but I would very much advise grad students to not pick up a new pet if you're trying to save money. [He was a very inexpensive dog up until this surgery, but this very easily could have happened when I didn't have a spare $6k. I would have probably put it on a credit card and just let it ride until I could pay it off.]
-Crappy rentals. I tried to save money once by renting a cheap place. It turned out to be owned by a slumlord and I cut my losses and paid a $1000+ fee to break my lease (plus an extra truck rental to move my stuff, extra pet fees for a new apartment, etc.). Pay a little extra for a place not owned by a slumlord.
-Travel. I traveled a good bit during graduate school. I tried to coordinate my trips with conferences, so that I could finagle some money out of the department or organizers for me to fly over. Sometimes I succeeded, sometimes I did not. One time I traveled overseas with a partner whom I knew I didn't want to be with long-term and who I mostly didn't get along with. $2k down the drain. Don't do that.
-Lunch on campus. I did this for a couple years until I realized just how much the $7-10 three times a week was costing me in the long run. Make a PB&J and eat it dejectedly in the lounge while everyone else feasts.
-Car. I had a paid off 1998 Chevy pickup truck during graduate school. But I still had to pay yearly registration, insurance, gas, maintenance on it. I should have just used a bike. Plus everyone asked me to help them move.
-Moving. Speaking of moving, I worked four different one-year positions before landing a TT job. I moved multiple times a year. I have probably spent like $5k on UHaul and boxes and stuff. Stay in one place, if you can.

The smartest thing I did during graduate school was put a small inheritance I received from my grandmother (~5k) in a Roth IRA. So that's another piece of advice: just stash windfalls and don't touch them. Using traditional or Roth IRA's to do that is helpful, because it's tough to take the money out after you put it in.


The interview with Dr. Hedberg is interesting, as it also highlights the range of experiences people have in graduate school. I also got myself out of debt in graduate school, but it involved the use of a consumer credit counseling agency and freezing the use of credit cards. Try putting together cash up front in order to pay for conferences for which you will not be reimbursed for several months when you're in debt! I had to forgo a few opportunities because of not having the capital to travel and also pay down debt, despite getting external funding, etc.

I also got financial advice from some professors which I rue to this day, which was to (a) take out student loans even for the summers and (b) not take on any work for pay that wasn't directly related to my Ph.D. The idea seemed to be that if I focused all my energy on graduate school, I'd get a good job and the loans wouldn't be a big deal. This kind of advice is really dangerous, even if it's motivated by optimism compounded with a sense of institutional limitations (the schools not having enough summer stipends, etc.).

There's also a real social cost to frugality in some contexts. While grad students may be famous for loitering around for "free food," in some programs, philosophical networking happens at bars and pubs after hours with faculty and other students--and students are expected to contribute. (I hope some of this has changed since my time, but it was my experience.) While going and requesting a split check is an option, or just not eating/drinking, these decisions aren't easy. I still remember feeling humiliated when I asked for help moving in graduate school and, due to my financial situation, couldn't even afford the promised "thank you" beers and pizzas! This was at a time when many of my peers seemed to be taking European vacations and have no problems paying for school. (Though inferring actual financial situations from the outside isn't reliable!)

In hindsight, there were other choices I could have made, certainly, and even in the high-cost of living city where my program was, some frugality might have made a difference. But in addition to the individual choices and institutional limitations, I think the social landscape of these issues is important to focus on as well. (I haven't touched on class, gender, race, and the like in relationship to finances in grad school, and social pressures, but there's a lot to say there, too.)

Trevor Hedberg

Regarding retirement savings, I think it's pretty tough for graduate students to prioritize that, but on the bright side, if you've been living successfully on a stipend of $15K-20K during graduate school, then you should be able to save a significant amount of money once your income doubles or triples when you are employed in your first "real" job. Even entry-level non-academic jobs usually pay much more than the typical stipend of a graduate student in philosophy.

I'll also admit I hadn't considered the potential costs of having pets. My main reason for not having one was that I didn't have the space I thought was necessary to properly accommodate the type of companion I'd want (a dog of 60+ pounds). But I can imagine that the financial costs of veterinary care and such -- even for healthy pets -- would be a significant expense for most graduate students.


Thanks very much for doing this interview and sharing it here, Trevor. I noticed a wide variety of spending habits among my graduate student peers, and it's something that could be talked about more.

I want to second a point made by Marcus and Trevor. If you're lucky enough to get a decent academic or alt-ac job after your PhD, you should be making at least double your stipend, probably more; I'm in my third year of a tt and making between four and five times my PhD stipend. If you keep your spending habits in check (at least partially) you should be able to catch up on retirement savings quite quickly. With fairly aggressive saving, I expect that with five years in this job I'll have enough in retirement accounts that (assuming reasonable investment growth) I'll be able to retire at age 65 even if I stop adding to it.

There's a wealth of advice on these issues in the "financial independence / retire early" (FIRE) community. As the name suggests, it's mainly geared at people with good incomes looking to live below their means so they can retire early, but the sort of advice they give (which is similar to the type of things Trevor talks about) also applies to those trying to simply make ends meet on a graduate stipend.

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