Monday, October 26, 2009

Climbing El Cap'

The day after our wedding, the phonecalls stopped. No more hectic caterers, confused florists, irate wedding planners, sobbing relatives, or lost guests. Just the two of us in marital bliss. After weeks of sleeping past noon, we got on a normal schedule and began sorting through the heaps of wedding presents, plus all her stuff, plus all my stuff. Trying to cram it all into our tiny rental apartment has forced me to purge my wardrobe of all articles of clothing over seven years of age, begin selling some of my five computer systems, and haul out bag after bag of miscellaneous junk to the trash. It’s hard to believe I landed in this country three years ago with just two suitcases.

Leaving America with all my belongings.

Purging my possessions has caused me to try to organize myself mentally as well. What are my new life goals now that the big one, marriage, is squared away? Rambam (the 11th century Jewish sage Maimonades) lists the proper order of one’s life goals as: Parnassah (income,) Bayit (home,) Ishah (wife.) In plainer talk, get yourself a job and a roof over your head before you think about getting married. In my 31 years on this planet, I have never actually owned my Bayit, always rented. In Israel, I have been homeless several times, living off the hide-a-beds and eating out of the fridges of friends and relatives for a month or more until I could find a new apartment. While vagrancy is tolerable for a rough-and-ready single, it would be a nightmare to drag my family through that. I need to own an apartment.

A compensating factor for the diminished personal wealth of life here is the feeling of total ownership. In Israel, even the sky is Jewish. I don’t need a castle with a five acre lawn because all the hills, streets, and trees around me are already mine. Still, I would like to have four walls and a roof of my own, to have my life beyond the whims of my landlord.

Personal finance in Israel, at least for most people, involves finding some way to scrape by. It is possible to pay the rent and bills, but it’s unusual to be able to get ahead. The cost of living for basic items (milk, eggs, busfare, etc.) is approximately the same as in the United States. Any luxury items, such as quality shoes, deodorant, a computer, or my car (which I have now sold,) are typically double to triple their cost in the United States. Meanwhile, my salary here is half to a third of what it was in the United States. A low-cost apartment in the settlements goes for at least $200,000, and a place in the outskirts of Jerusalem goes for a minimum of $300,000, and since down payments are typically 30%-40%, my down payment would be from $66,000 to $100,000. Based on a simple calculation of our earning potential versus expenses, it would take us anywhere from twelve to sixteen years to save up this amount, ignoring the effects of inflation. And that doesn’t include times like now, when I’m unemployed watching my savings bleed away. Also, while as a new couple it is possible to save up money, as time goes on and there are, God willing, more and more mouths to feed, saving anything in this country becomes impossible.

Our original plan was to give it a year and try to find something that paid better than my job at the solar power startup company. Then, five months ago, I was laid off. I’ve been to a couple of job interviews that looked really hopeful, to the point that one manager told me, “You are the ideal candidate. I’m flying to Austin next week to sign a contract, and when I come back, I’ll have an offer for you.” Having not heard from him in some time, I asked around. Turned out the company didn’t get the contract and was in a nose dive, shedding employees. I’ve reaped similar sour grapes from my other job interviews. It seems that, at least as far as I’m seeing, Israel is just too small a market for large, stable engineering firms. If they exist, they sure aren’t hiring. I’m sure that if I continue to apply myself, I can eventually land another six-month gig at another green-tech startup till it flops or is sold.

The question of leaving Israel temporarily to work and save is an option I’ve considered for some time and my feelings are mixed. Nobody comes to Israel to get rich, they come to satisfy a spiritual and ideological impulse, and to live with family. On religious terms, there is simply no comparison to the potential for spiritual growth in an environment with endless options for Torah study, the highest levels of kashrut, and a culture rooted in Jewish life. While I could sacrifice a few years of this growth on a personal level, there is a national aspect to living here as well. Living in Israel isn’t just another lifestyle choice, like dropping into Paris or London for a few years. I still haven’t lost the inspiration of participating in the restoration of the Jewish homeland and repatriation of its exiled natives after thousands of years of wandering. If every Jew were to base his or her decision to stay or leave on financial grounds alone, this country would be abandoned and revert to the deserted ruins it was under Muslim rule. Then again, if working abroad for a while helps me anchor myself here more permanently, then it could be a worthy sacrifice.

There is a reasonable case to be made for either sticking it out or going back into the diaspora for a while, and so I asked Hashem to affect my ratzon, my will, to push me in the right direction. In the end, my ratzon is pushing me to jump through this window of opportunity.

In Yosemite, I remember once speaking with a mountain climber who had scaled El Capitan, at over 3,500 feet, the tallest shear cliff in the world. At certain points on his ascent, he could anchor his equipment into the granite face and lower himself down by pulley, and then hoist himself back up to the same spot the next day. Walking into a bar in the evenings, his friends asking him what he was up to, he would answer, to their bemusement, "Right now, I'm climbin' El Cap'."

El Capitan

And so am I. Aliyah, literally "Ascent" is a process. When I landed here three years ago, I never thought I would have to leave again, but I'm not giving up on my Aliyah by a long shot. I have my family, friends, and connections, and I have some idea of how life works in this country. It may be a few months or a few years before I'm back permanently, but I can pick up life where I left off, I view this as part of the process.

So, on November 2nd, wifey and I are going on a voyage. We will land on the East Coast, spend some time with my wife's family and purchase a used car. After visiting cities in the east, we will begin driving cross-country. We will stop in various communities across the United States and Canada getting to know one another’s family, seeing the sights, visiting those who could not attend our wedding, and hunting down job leads, until we reach my family in the Pacific Northwest. I’m confident we can find something, but even if we don’t, at least we’ll know we didn't let the opportunity pass by. And I won’t forget to write.

Friday, October 02, 2009

More on Student Loans and Defaults

I've been having a conversation with Zapporah over my previous post on the Student Loan Scam.

I think it deserves its own post here, since this is an important issue which affects people for their entire lives.

Zapporah said...
Please answer me this... I just graduated college and I am moving to Israel in just a few months. Can I escape these high loan amounts in Israel? What will happen to my credit rating in Israel? Is it the same as in Canada with the new social number? What will the repercussions be for me in Israel?Thank you so much for this article.
8:49 PM

Ephraim said...
Hi Zapporah,There is no such thing as a credit history in Israel. At this time, lenders do not persue delinquent debtors outside of the United States. Also, there is no debtors' prison or anything like that, so you can fly back and visit as desired. Please note, however, that as of the writing of this comment, there is still no bankruptcy or statute of limitations on student loans. Therefore, if you default, and then you return to the U.S. after 20 years, your debt collectors will be waiting for you. Also, over the next 20 years, there could be a change in finance laws which makes it easier to persue debtors abroad. Nobody really knows which direction this will go. But for now, you will be safe from the loan collectors.

Zapporah said...
Ephraim, thanks. I signed up for as many classes as possible to get out of school in 18 months so I didn't have to pay more money. I knew my end date would be in June, but it kept coming up for Sept and no one could answer me why. I ended up being charged $3,000 more for the 3 months they added on because they didn't put me in more classes to get out of school by June which I signed up for. I was fully prepared to pay the $15,000+ amount but after reading this and getting $3k+ tacked onto my bill, no way am I going to start repayment. I will try for one more month to get the school to wipe the $3k off and if they don't, I'm out. Thanks a lot.

And Ephraim Says:

So basically, your college ripped you off. This is actually somewhat unsurprizing. Many colleges are now run more like businesses than educational institutions, and with a profit motive involved, inevitably there will be crooks and thieves in the mix.

However, please bear in mind one thing. If the college goes forward with charging you $3,000, then they will probably just take the money straight from the lender, unless you can find some way to convince the lender not to send the money to the university. Basically, if you default, the odds are that the university will get the money regardless.

If you do default, keep in mind that this debt will balloon with late fees and astronomical interest rates. They will not be able to come after your income as long as you are here in Israel. However, they will be able to sieze your tax returns (you still have to file tax returns from Israel to the United States every year, even if you are abroad.) That means that things like the stimulus checks or any other sort of money you would ordinarily receive on your tax returns would be lost.

More importantly, if say in ten or twenty years, should you decide to return to the United States, even if just to work for a few years, the creditors will come after you and attempt to garnish your earnings.

My own opinion is that people who are trapped in this hellish mess of massive and unrepayable debt should flee the United States as a last resort. However, this has dire personal consequences and probably shouldn't be undertaken unless the debt is so crushing that it is impossible to repay.

It's just a good idea to think about the ramifications of a decision which will affect the rest of one's life.