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Student Debt For College Likely To Exceed a Trillion Dollars

Student Debt For College Likely To Exceed a Trillion Dollars

The Financial Aid office at my college is not a place students like to go. A recent report in the New York Times about student debt makes it very clear why: Student debt is likely to rise above a trillion dollars this year, exceeding credit card debt. While less than half of students who earned a bachelor’s degree took out loans for college in 1993, two-thirds did in 2008. Last year, the average amount of debt for graduates was $24,000 — a debt burden that is all the more difficult to pay back as recent graduates struggle to find jobs in the recession.

Some education experts remark how starting post-college life with such a debt burden no doubt weighs on career and life choices:

“If you have a lot of people finishing or leaving school with a lot of debt, their choices may be very different than the generation before them,” said Lauren Asher, president of the Institute for Student Access and Success. “Things like buying a home, starting a family, starting a business, saving for their own kids’ education may not be options for people who are paying off a lot of student debt.”

In some circles, student debt is known as the anti-dowry. As the transition from adolescence to adulthood is being delayed, with young people taking longer to marry, buy a home and have children, large student loans can slow the process further.

Susan Dynarski, a professor of education and public policy at the University of Michigan, describes student debt as ‘good debt.’ Studies continue to show that college graduates earn more than those who do not have a degree, with $55,700 in median earnings for bachelor’s degree recipients working full time year-round in 2008 — $21,900 more than the median earnings of high school graduates. College graduates earn more over their lifetimes and their unemployment rate is lower.

I need to remind my own students of these facts, especially the education and humanities majors who face a very tough market for entry-level teaching jobs, and the nursing majors struggling to get through the rigors of their programs. As an example of the benefits of college, even if one has to shoulder a mountain of debt, the New York Times cites no one less than the President and Mrs. Obama:

Barack and Michelle Obama helped raise awareness when they spoke in the presidential campaign about how their loan payments after graduating from Harvard Law School were more than their mortgage payments.

“We left school with a mountain of debt,” Mr. Obama said in 2008. “Michelle I know had at least $60,000. I had at least $60,000. So when we got together we had a lot of loans to pay. In fact, we did not finish paying them off until probably we’d been married for at least eight years, maybe nine.”

Even then, Mrs. Obama said, it took the royalties from her husband’s best-selling books to help pay off their loans.

The Obama administration has made it easier for students like mine whose families have lower incomes to get out of debt, with a program of “income-based repayment that forgives remaining federal student debt for those who pay 15 percent of their income for 25 years — or 10 years, if they work in public service.”

It’s not easy to tell students who are juggling studies, jobs and life that their student loans will all be worth it; that there’s ‘no pain without gain.’ The benefits, economic and otherwise, of a college degree are clear: How can we help students to get the education, training and knowledge they need to work without having to spend their whole careers paying it back?

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46 comments

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7:37AM PDT on May 30, 2013

Thank you for sharing.

4:25PM PDT on Sep 20, 2011

woooah @_@

7:24AM PDT on May 6, 2011

I went to undergrad from '93-'97. I came out of school with a B.S. in Wildlife Biology and nearly $30,000 in student loans. I was not alone--I knew many other students who were working while in school (as I did), getting some help from parents and living as frugally as possible (e.g. I lived on $90-100/month for groceries). I was told that to be competitive (i.e. have even a remote shot at getting a job) in my chosen career I needed field experience and a Master's degree--and probably a Doctorate as well. I got the former and another $17,000 in loans. I am currently working as an office manager/personal assistant. I found out a few days ago that I am being laid off due to financial constraints--my last day is next week. So much for working hard and getting 2 degrees along with years of specialized experience. I have had some good experiences, but I'm tired of worrying that my student loan debt will be with me until after I retire (if the Repub's have their way, I'll never be able to retire). I didn't want student loan debt, but I did it with reassurances that the path I was taking would lead to a good job in a field that would contribute to conservation--for wildlife and local communities. Mainly, I just have a lot of debt.

3:10PM PDT on Apr 22, 2011

Forty years ago employers were willing to train people for the positions that were needed, and many people made a decent living after that. Plenty of self made wealthy people back then, without degrees that have done better than many with degrees today and had far better ethics than many pukes in business these days, without resorting to the tactics they do today.
I remember plenty of people who truly were respectable businessmen in the 1960's and they weren't out to clip ya for the very last cent, unlike today. The Yuppies of the baby boom generation brought alot of ugly dynamics to life that has culminated in the acrid environment that exists today, while they never seem happy with any amount of income they already have.
The student loan bubble will break, like all the other "bubbles". My hope is the bottom feeders that have schemed away trying to find more ways to pocket more cash get stuck in a big way and take a huge fall. It couldn't happen to a bigger bunch of parasites!
With all the college educated populous this country now has, isn't it amazing how few answers there are to some extremely serious problems?. .
.Proof I guess that college education without common sense is alot of hot air.

2:42PM PDT on Apr 19, 2011

Just another nail in our Education system, only the rich will be able to afford to send their kids to college, a view of back to the future.

3:33PM PDT on Apr 14, 2011

Students will only be able to study subjects which will lead to high earnings. Where are all the health, social care and charity people going to be educated.

11:15AM PDT on Apr 14, 2011

Since 1982 (when I was 21) the cost of an education has risen around 400%, where the cost of living around 170%. The excuse I hear is about how important education is, (true) and how it will benefit them once they complete it. Just the last five years the cost has gone up 20%. Come on, people! This is our future physical therapists, nurses, doctors, teachers...the list goes on and on. Here, here's your diploma and a big ball of crushing debt! Oh, and good luck finding a job!. I am a geriatric nurse, and have taken care of a lot of people who lived through the Depression and World War ll. A lot went to college slowly, paying as they went. Maybe we need to bring that trend back, so it will be paid off. Also, if we choose to have kids, live frugally, and put money aside to help them, instead of racking up debt. There has to be an answer to this.

10:07AM PDT on Apr 14, 2011

For a country who keep saying that they are the best in the world they are doing a hell of a bad job with THEIR student population...you are ok in the US IF YOU HAVE MONEY...and this is wrong!

3:34AM PDT on Apr 14, 2011

"income-based repayment that forgives remaining federal student debt for those who pay 15 percent of their income for 25 years -- or 10 years, if they work in public service." is a small bright spot in an otherwise bleak picture. I got my education somewhat late and then ran into so much prejudice on account of a combination of age and never having had a good job due to having gotten educated so late--that I NEVER did get a good job.

11:42AM PDT on Apr 13, 2011

Very discouraging and upsetting.

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