Student Debt Over The Years

oday, society stresses the importance of postsecondary education to students due to the countless ways that an associates, bachelors, masters, or doctorate can enhance an individual future. For an individual to reach financial security in the United States’ economy it is basically mandatory that they have received a college degree. Postsecondary education will provide skills and knowledge that will prepare individuals to be successful within their career as they compete for leading positions. Overall as an individual receives a college degree they will become more likely to experience job security and financial security, and this is important to most as they hope to live a stable life. In college, students are taking as many as one hundred credit hours which contributes to most also accumulating student loan debt as they try to finance their education. Even though the completion of a postsecondary education will contribute to a graduate obtaining a respectable income it may also cause graduates to suffer from high student loan debt which will negatively impact their finances far into their adulthood. R.J. Matson created the image above to emphasize how student loan debt negatively impacts student and changes need to be made to avoid stress caused by the debt.

Here in the United States, there are many forms of consumer debt, which help contribute to the large sums of debt countless Americans find themselves faced with. Directly effecting many college students is student loan debt. Student loan debt is now the second largest form of consumer debt behind housing” declares the Federal Reserve Bank of New York (Grisales). This is due to the fact that student loan debt grew 7.1% in 2014 to $1.2 trillion (Grisales). If this statistic alone is not worrisome this next one is sure to be. The amount of debt in the housing market that helped to spark the last recession was only $1.3 trillion (Grisales). Due to the increased amount of debt required by students to attend college many students are feeling the wrath. According to the U.S. Census Bureau, “In 2014, 11.7 percent of females and 17.7 percent of males between the ages 25 and 34 were living with their parents” (Grisales). The fear of obtaining massive amounts of debt is driving the current generation of student’s to put off many future hopes and dreams. While causing them to move back home to save money. The current student loan crisis is crippling the economy and ruining the lives of American students.

College debt has risen significantly since “The Great Recession” in 2009. Due to the high college fees, students are faced with lifelong debt. If the rise continues, only the rich will be able to obtain a higher education, resulting in American education to take several steps backwards instead of improving. Although many have tried to fix college debt problem, it has mostly gone unnoticed. Specifically targeting the nation’s youth, college debt is destroying the chances of the lasting effects on the economy from fully recovering.

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

An estimated 20 million Americans attend college each year, and 60% of those students borrow annually to pay for it (qtd. in asa.org, “Student Loan Debt Statistics”). Moreover, citizens continuing to pay off debt after schooling brings the overall number of student-loan-borrowers to about 40 million- with a collective 1 trillion dollars in debt (McCarthy, “10 Fun Facts About the Student Debt Crisis); a fourth of these borrowers owe over $28,000, a tenth owe over $54,000, 3.1% owe more than $100,000, “and 0.45 percent of borrowers, or 167,000 people, owe more than $200,000” (Haughwout, “Grading Student Loans”). While some view this predicament as the result of laziness or carelessness, the bulk of this substantial group are not at fault.

Tuition and student debt at colleges and universities in America have been rising far more quickly than inflation for over four decades. This is a trend that will continue without intervention. Student debt drastically affects students’ lives and decisions from getting married, to buying home, or to starting a business. The amount of debt held by students after graduating not only negatively affects the individual, but the economy as well. Loads of economic activity is currently halted by students working to pay off their loans. This is a consequential problem and the increasing number of student debt in America must be addressed.

Throughout the United States, student loans have been show to drag this economy down. Student loans have been a big problem through many of the years. It has been showing a trend and it is raising and exceeding many of the debt types each year. Many problems that students that have loans cause are, “ 20 percent of respondents indicated they cannot get a loan for other items, are unable to purchase a home, and student loan debt negatively impacts their credit. 18 percent of individuals indicated they are living paycheck to paycheck, “drowning” in debt, and have a large debt load. 13 percent indicated they have a lower quality of life and are unable to afford the extra things. 12 percent indicated they are unable to save for their retirement or their children’s education and feel less secure.” Students that have

Student debt is a major issue, especially in the United States. It often impacts on a student education. Mostly, students from middle class family suffer from it. In the United States, the cost of tuition fee is very high, which is the most common reason behind student debt. Though there are various scholarships and federal aids for the students to help with tuition fees, most of the universities and colleges don’t cover full amount of the tuition fees, which leads the students to take loans, which causes student debt. However, there are also difference between universities and the loan system. Federal colleges and universities often have affordable tuition fees, which often don’t require students to take loans. However, tuition fees of private colleges and universities are extremely high, which don’t only require students take loans, but sometimes, the loans are even sufficient to cover all the tuition fees. Moving to the loan system, there are two types of loans; loans with interest and loans without interest. Loans without interest are usually better and affordable to take, but loans with interest are very expensive and not affordable to pay at all. And often, loan with interest is what leads to the student debt. After all, high tuition fees and loans with high interest are the reasons behind student debt and the problems with student debt are enormous. More or less, every one of the problems with student debt impacts on student education, which then impacts on a student

Student loan debt has increasingly become an issue, not only for those who have acquired it and must deal with it, but also for the economy. To function normally in today’s society, pursuing a college education is a requirement for those who want a high paying job. With this decision, students also choose to accept the massive amounts of debt and the long-term turmoil that it inevitably leads to. Student loan debt impacts students purchasing power, which negatively impacts the economy. Currently, there is over $1.3 trillion outstanding in student loans (Rosato). Recent state disinvestment in public universities has led to tuition increases, forcing students to borrow more than ever before. As a result, over 20% of these students are denied

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

In the United States, Student loan debt has recently reached an important milestone, during the year of 2010, total student loan has exceed the national credit card debt. Approximately a year later, outstanding student loan reached 1 trillion in total, however, this was anticipated decades ago, because unlike credit card debit, which only has a few months to pay off, student loan debt can take up to 10 years or more in order to pay off completely. Therefore, borrowing money from the federal government has become a regular tool for paying for universities these days. Aside from the federal loan implemented at federal level, there are various private loans for different needs, students

A major contributing factor to the crisis is the shift in the type of school students choose to attend (Tankersley and Douglas-Gabriel n.pag.). Eleven percent of the total students in the higher education system attend for profit schools; on the other hand, those students represent forty-four percent of all defaults on federal student loans. Borrowing has increased across the board with the rising cost of college tuition (Tankersley and Douglas-Gabriel n.pag.). Federal grants only cover a third of the cost of tuition, forcing students to borrow from private and student lenders. Tankerley and Douglas-Gabriele postulate,“Because the federal government will only allow undergraduates to borrow up to $31,000 in total ($57,500 for older independent borrowers) students at for-profit schools often turn to banks and other financial firms for loans” (n.pag.). In 2013, loans that started repayment in 2011, two percent of graduate students, eight percent of undergraduates, and twenty-one percent of non-traditional students had defaulted in the first two years of repayment (Tankersley and Douglas-Gabriel n.pag.). To emphasize, seventy percent of all borrowers in 2013 were non-traditional

Every year, the consumption of student loans keeps on increasing. According to the statistics graph at the bottom, 71% of all students graduating from four-year colleges in 2012 had student loan debt, increasing to $20,000 more since 1993 (Gale Cengage Learning, 2016). Students are put into helpless positions to afford a college education. Since it’s a necessity for almost all students, the problem of the consumption of student loans may not be fixed as a whole. Borrowing loans will always be a

In 2016, an accumulation of almost 1.4 trillion dollars of student loan debt was outstanding in America (Kess). Students from all over the nation, and the world for that matter, are going to higher education without the financial ability to do so. One of the few options for financial aid available to these prospective college students is to take out student loans to pay for the high tuition of most universities and colleges. While these loans are a modality for attending higher education, they often come with strings. Along with being several thousand dollars in debt, interest also accumulates into the total amount of the owed financial total. Until these loans are repaid the interest keep accumulating and the debt grows. With debt still affecting students negatively well after they finish their higher education, the price of college tuition should be abated.

If an aspiring college student doesn’t have the necessary funds to attend school, there is another option they could use to pay for school. Student loans are a popular choice so that the student can pay for school. While this may seem like a great option for affording school, it can be a devil in disguise for many. The New York Times reports that Americans owe over 1.4 trillion dollars in student loan debt (Kelly 1). This happens when a college student takes loans with the belief that the college degree they get will help them achieve a higher salary which will in turn will help them pay off their debt. This often isn’t the case. A student takes the loans and attends school, but does not receive the salary that they were hoping to acquire from attending school. A standard payment plan for students is to pay off their debt in ten years, but according to a study conducted by US News, the average bachelor degree holder takes twenty-one years to pay off (Bidwell 1). This is a common occurrence as well, a report conducted by The Institute for Collee Access and Success shows that in 2012, seventy-one percent of college graduates had student debt (Serrato 1). The current system that the government offers to help those struggling to afford a secondary education is a flawed program that needs restructuring.