Student Debt Essay

While this is often true, it can create problems when a student does not have the money to pay for a quality education. The cost of college has risen an estimated 250-500% over the last 30 years while consumer price index has only increased by 115 percent during the same time frame (White, 2015; Eskow, 2014). The amount of student loan debt is increasing, along with the cost of college. The income of many young people today cannot keep up with the rising costs of college education and housing. Part of the problem with student loan debt begins when students choose to attend a college that exceeds their financial resources and rely on federal student loans as well as private student loans to make up the difference. Eskow found that even public colleges and universities are becoming difficult to pay for without taking out student loans often averaging $30,000 for tuition, room, and board (2014). Since many people do not have enough money to cover college education expenses, they rely on student loans, both federal and private, to fill the gap. Financial advisor Ramsey stated that often the loans students take out pay “for an off-campus standard of living, and no debt was needed to get the degree” (2013). “The Project on Student Debt reported in 2013 over ⅔ graduating seniors were leaving school with student loans” averaging approximately $28,400 (White, 2015). Taking on almost $30,000 in debt before even starting a career can have a significant impact. It can force people to get a job just to pay off the student loans, not based on what they got an education for prepared for or what they studied. This also can cause a setback in future plans, having to delay many adult milestones due to lack of

Many students do not know what they are paying for or understand how student loans work, and are not fully aware of available resources. For assistance, most students know to go to financial aid, however “financial aid offices allow students to borrow thousands of dollars with several mouse clicks on online portals” (Farrington). Many students are not properly informed of their options, such as the many scholarships available to them, but simply take only what is shown to them. Easy access to loans is a slippery slope and many students fall into holes that they

“We’re debt free!” shout exuberant people on Dave Ramsey’s radio show. After finally paying off thousands of dollars of debt, people shout more enthusiastically on the Dave Ramsey show than they do for New Year’s Day celebrations. In addition to the standard credit card payments and automobile loans, many of Ramsey’s celebrators have also battled student loan debt years afterwards their college educations. College affects people for the rest of their lives. It opens up career opportunities and plays a critical role in taking the “young” out of the “young adult.” Yet college all too often burdens new graduates with student loan debt. Because my family strongly disproves of debt, finances heavily influence my college search. Not only would receiving

A problem with student loan debt is that students gain more debt because they are not able to pay off the student loans within the given time which also causes them to put certain life decisions on hold. According to Sophie Quinton debt is a problem for the recent college graduates because “There’s currently no way to get rid of federal student debt other than paying off the loans. while some borrowers are paying off their debts just fine, overall they are adding debt faster than they are shedding it”(Quinton). According to Jamaal Abdul-Alim stated that a “survey - titled Student Loan Debt: Who’s Paying the Price?- revealed a number of troubling statistics about the practical ways that student loans are impacting college graduates in their everyday lives. For instance the survey found that: 49

With the ever-increasing tuition and ever-tighten federal student aid, the number of students relying on student loan to fund a college education hits a historical peak. According to a survey conducted by an independent and nonprofit organization, two-thirds of college seniors graduated with loans in 2010, and each of them carried an average of $25,250 in debt. (Reed et. al., par. 2). My research question will focus on the profound effect of education debt on American college graduates’ lives, and my thesis statement will concentrate on the view that the education policymakers should improve financial aid programs and minimize the risks and adverse consequences of student loan borrowing.

College debt can stunt most students from pursuing their college dream and going to their school of choice. Students get scared of the word debt and the numbers that they would be dealing with outside of college. Students are putting aside going to their dream schools because of the fear of how much debt they will get into after college. There are many reasons why people don’t pursue college, or just from not being able to afford it. Students go back and look at not going to their dream college or college at all and regret not taking the challenge and going with what they always wanted to do. Some students experience not being in debt after college and why they think college tuition is right where it needs to be, but others will make shocking choices to not be in debt. College students are choosing not to pursue their dream college or college at all because of finances they would be dealing with after college, debt.

Student loan debt relief is a controversial issue in America today. Student loan debt affects twelve million college students, roughly 60% of all college attendees, per year (Student Loan Debt Statistics). Student loan debt relief rose to the forefront of economic news during the financial market crash of 2008. The U.S. Government has developed a debt relief plan that extends payments over a 25-year period, with a full forgiveness of all remaining debt at the end of that 25-year term (Ensuring That Student Loans Are Affordable). During this repayment period, payments can be suspended during times of unemployment, giving hardship students a break from their student loan payments. Many people feel that student

Because of the nation’s national rising debt, student loan forgiveness has been a significant topic of debate because of how much it can affect our nation’s debt and doesn’t always help the student. Student loan debt is one of the highest debt causes, but sometimes we forget that we are the ones that sign the line on the contract to be in years of debt. This is because we value our education. But this does not mean that just because we can’t find an amazing, high paying job right out of college that we should have our loans forgiven. We want the easy way out of something that isn’t easy, so why should the government pay for our debt? Yes, college is very expensive and that is the governments fault, but again we are the ones that signed the line on the loan papers. (Sam Adolphsen, 583)

College debt is becoming more of a drastic problem in the United States with the rising costs of college tuition. In “Why the Student Loan Crisis Is Even Worse Than People Think” Mark Kantrowitz expresses how the issue of student debt in America is to be blamed by the government’s lack of action. In “Is College Doomed?” Graeme Wood expresses the benefits of the new and innovative univeristy Minerva. A perk about this university is that it includes the cheaper tuition than other ivy league schools because of its lack of all the componenets of an average university. The government needs to be more involved in preventing future college students from graduating with overwhelming debt.

In the U.S. students are encouraged to earn a college degree, but the cost of an education turns many away. “Driven by the allure of a decent salary with a college degree, Americans borrowed to go to school. Outstanding student debt doubled from 2005 to 2010, and by 2012 total student debt in the U.S. economy surpassed $1 trillion” (Mian, Sufi 167). There are plenty of opportunities to obtain funds for college, including one of the most common, student loans. A student loan is defined as “a common way to fund education, specifically college and graduate school, and they provide educational opportunities that you otherwise may not be able to afford” (Barr). Student debt is at an all-time high in America. Over half of all lower income

As Young teenagers become adults and start College, one issue that doesn’t seem as a big deal at the moment for many students are student loans. Young college students who don’t have the money, don’t have enough scholarship money, or family who doesn’t have the money to pay, will apply for student loans each year. They amount the student receives can vary depending on the college and what the student has achieved academically. Though interest rates are low with subsidized being 4.29% and unsubsidized being 5.84% ("Federal Student Aid" Interest rates and Fees), student loans still have a huge effect on college students once they graduate. One college graduate’s story helps explain the struggles for most students:

In the year 2007, 18.2 million students enrolled into college. About thirty-nine percent of those students were between the ages of eighteen to twenty-four (Marcus). College is seen as something one must do to be able to have a successful life or career. Student debt is almost guaranteed for anyone that goes into college. Seventy percent of bachelor's degree recipients graduate with student debt. Student loans in just the U.S. alone are up to 1.2 trillion dollars, this is the second highest level of consumer debt, just trailing behind mortgages (Snyder). Student debt has been an issue for anyone thinking about going into, that is attending, and graduating or leaving college. How to solve this issue is very simple, which is to save money, lower

Consequently, students usually accept whatever aid they get without questioning the consequences of it or if they could borrow less. A recent survey by iontuition reveals that most students lack basic information regarding their loans. In high school there is a lack of financial literacy, which is a necessity for those planning to move forward with their education. Since kids were never informed in high school about financing for college, they make uneducated financial decisions. It is time for colleges or high schools to step up their game and to start putting it on themselves to send letters or hold conferences to teach: what different kinds of loans are out there, what loans create how much interest, how much money you should take out for your expected job salary, and payment plans for after college such as PAYE (pay as you earn) and refinancing loans. This can help students make more informed decisions about whether a university or career path is worth the debt. “Whether a student is borrowing too much or too little depends on a range of factors, from family wealth to the chosen degree and whether the student graduates.” (Kelly of the American Enterprise Institute) Each person is different, so they need to decide for themselves what the best plan would

Debt can make one’s life become a stressful thing. There is a constant worry the debt will continue to grow or dealing with the struggle of having to pay every last penny back plus more. Colleges are finding fewer reasons to lower prices and more reasons to raise prices. The college perspective is understood by many in this matter though. Colleges, as well as any other business, needs to make money also. The affordability of college is the second most important thing about a child’s college education, right below the actual education itself. “… the cost of college will remain unaffordable, tuition will continue to rise, and the 18-year-olds… will ‘get to’ continue paying for college with student loans” (college cost act does not…). Does it really pay off to go to college though?

In the United States today, the number of students graduating college with student loan debt is quite astonishing. In the article titled, “How the $1.2 Trillion College Debt Crisis Is Crippling Students, Parents And The Economy”, we will examine and break down the student loan debt crisis by the numbers. Today, almost two-third’s of students graduating college are graduating with an average of $26,000 in debt. For most students, $26,000 is a lot of money when the average annual income for a first year graduate is only in the mid $40,000 a year range. According to the Consumer Financial Protection Bureau, student loan debt has reached a new milestone, crossing the $1.2 trillion mark (Denhart, 2013, Introduction, par. 2). With student loan debt levels