Education Debt: The Problem and Solutions Essay

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

An education is one of the most important tools a person can acquire. It gives them the skills and abilities to obtain a job, earn a wage, and then use that wage to better their lives and the lives of their loved ones. However, due to the seemingly exponential increase in the costs of obtaining a college degree, students are either being driven away entirely from earning a degree or taking out student loans which cripple their financial prospects well after graduation. Without question, the increasing national student loan debt is one of the most pressing economic issues the United States is dealing with, as students who are debt ridden are not able to consume and invest in the economy. Therefore, many politicians and students are calling

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.

In the United States, it is generally accepted that college (or any form of higher education for that matter) is a wise investment that each and every individual should strive for. Each and every year thousands of parents open college funds and future investment plans to ensure that once their child is of age he or she can participate in quality educational programs. While college attendance rates are at a positive all-time high, right behind it follows an astounding $1.3 trillion dollars in student loan debt. Let’s face it, college is expensive, and it’s only getting worse. Could the outstanding quantity of student loan debt be the next national crisis?

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.

With the 2016 presidential election looming in the near future, the subject of student loan debt has become a major issue on the campaign trail. The national amount of student loan debt is 1.08 trillion dollars, with 11.5% of that amount in default or in 90+ day delinquent. To put that in perspective, total consumer debt at the end of 2013 was 11.52 trillion .(Forbes, 2014) According to an in class poll, only 7 students out of 169 students were completely confident in their knowledge of student loans. However, if we had lower tuition and expenses students wouldn’t have to take a loan out in the first place.

While student debt has been an issue for quite some time, the steady increase annually is alarming. According to MarketWatch, The average amount of debt per student upon graduating in 2015 was $35,051; about $2,000 more than class of 2014 graduates. In comparison, the amount of debt per student in 1993 stood just under $10,000. In a report by the Urban Institute, a Washington, DC-based think tank that carries out economic and social policy research, the quantity of college graduates with more than $40,000 in student loans has increased by almost ten times in eight years. Not only is the amount of debt per student upon graduating steadily increasing, but also the amount of students requiring loans. Currently, the amount of students requiring loans to graduate stands around seventy percent; ten percent higher than class of 1997 graduates. These are

Student debt has become a large (and growing) problem. The high levels of student debt have served to perpetuate economic inequality, minimizing the opportunity of higher education. In a speech this year, President Obama called higher education "one of the crown jewels of this country" and said it was "the single most important way to get ahead.” The long term impact of student loans have given students every reason not to want to attend college, including myself. That alone has the potential to harm colleges and universities across the country. The Consumer Financial Protection Bureau said student debt is one reason that people between the ages of twenty and thirty seem to be living a prolonged adolescence, or living with their parents.

In 2016, college grads graduated with an average of $37,172 in student loan debt. This is a 6% increase from the previous year, and the rates increase as colleges become more expensive. Going to a University or College is looked upon as a luxury or a privilege nowadays. Good paying jobs that supply good living standards are requiring at least a bachelor’s degree to be considered for hiring. Any persons, including college students, should not be forced to live with, be pressured by, or be under the control of student loan debt. Student loan debt has been proven to have an impact on a person’s mental health. It keeps the less fortunate from having a chance to prosper in a competitive workforce, and the system that provides financial aid (FAFSA) doesn’t always meet a person’s needs completely. College should be an earned right for those who have stuck through the education process as an adolescent.

Over the last several decades, rising tuition rates and changes in federal and state policies, an increasing number of students are turning to college student loans. As a result of these changes in prices and policies, the percentage of undergraduates borrowing has increased from 37.8% to 46.2% for public 4-year institutions and from 48.5% to 58.9% for private institutions. According to one estimate, student loan debt has reached $1 trillion dollars, surpassing credit card debt (Reynolds and Brandon). Most recently, another report estimated that two-thirds of college graduates in 2011 had an average loan debt of $26,600, which is an increase of 5% from the previous year (Chen and Wiederspan). There are numerous factors involved in the

According to CNN, “Almost 19% of student loan borrowers owe more than $50,000.Only 6% of borrowers had that much in 2001.” (Gillispe, 1). Why has student loan debt increased so much? Student Loan debt has become a national problem with no solution. Many students are borrowing more money to keep up with the rising cost of tuition in universities, leaving themselves with thousands of debt after graduation. Students after gaining this debt, have to find jobs to support it which can come at a challenge after the financial crisis of 2008. So there stands a problem between students having massive amounts of loan debt and getting jobs to pay this debt off. Advocates or liberals think forgiving this debt is a good idea, while opponents or conservatives think it is not even an option. This essay will focus on the controversial topic of forgiving student loan debt and why something should be done about the massive debts graduates have. It is important to first look at the history of student loans and how the student loan crisis came about in order to understand the controversy.

I owe $40,000, I owe $60,000, I owe $100,000. Isn’t that a lot of money for one person to owe? Graduates have been faced with a serious problem brought about by the constant borrowing of money to gain a reputable education. The debt of loans varies from person to person but the extreme amounts that individuals owe is something the media finds worth gossiping about. Little does the public know, in reality, all the commotion and conversation about these debts are not accountable for the majority of college borrowers. According to A Lifetime of Student Debt? Not Likely by Robin Wilson, she intrigues her targeted college audience by giving examples and providing awareness that most individuals are paying back their students loans within a timely manner with just a few sacrifices. Wilson emphasizes that the real reason individuals have an outstanding debt is because “they are determined to attend their dream college, no matter the cost” (257). There are various reasons why students take out loans and Wilson is determined to clear up the confusion of student debt, she encourages college students to take out loans even with media’s negativity, and lastly she tries to enlighten this targeted college group that debts are repayable with additional sacrifices but in the end, that debt was the best decision they have ever made.

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

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.