Don Wesley Blight Jr.
Intro to College Writing
Professor Hankerson
4/13/2012
The Struggle against Improving Student Debt
The number for students borrowing money to pay college tuition has dramatically increased over the years. This problem is dwelling on young people and has created a spiraling downfall for future plans. Borrowing money for affording education faces multiple problems in the long run. After a student finishes college they can’t afford to pay back the loans at the rate required. This destroys credit which can cause a chain reaction of more negative issues to deal with. For some people college may even be looked at as dangerous and is not worth pursuing in. Student debt is putting a hold on life decisions such as buying a first home, marriage or even starting a family. Why would anyone want to attend college if the outcome is so harmful? Student debt is skyrocketing and needs to be assisted immediately. Education should not have a reputation as a destructive phenomenon. The struggle with student debt can be improved with the work of increased access to need based student aid, allowing students to complete education at a reasonable price, strengthening consumer protections, and access to income based repayment
College is an opportunity to fulfill your lifelong plans and be successful. This status is being destroyed due to the fact that students can’t afford their education. With the rise of tuition students are unable to achieve their goals and engage in a career of choice. After high school students should have an incentive to excel in college instead of being stressed out over heavy income issues. Today, students are working full time jobs just to afford other outside expenses. In spite of tuition people still have to pay insurance, cell phone bills, food and multiple other costs. School takes up a large portion of time as it is. Now throw a job into the mix along with the other accountabilities. People can’t expect to be up to par on every responsibility they hold under these circumstances. Student debt is undesirably affecting these secondary factors in everyday life. This is why student debt needs to be improved.
In order to understand why changes in student debt need to be accompanied, people need to observe the negative effects in financial. According to professor of economics Sady Baum, student debt averages have rose from $9,250 to $19,200 since 1993. When taking inflation into consideration, this is a 58 percent increase. Baum also states that two thirds of students who attend a four year university will be in student debt compared to fewer than half of the students in 1993 that carried student loans. At this rate it is daunting for students to imagine what college tuition will be another ten years from now. Bill Nowlin, Dean of Enrollment Management at Northeastern Oklahoma State actually said, “I have had students tell me they aren’t going to college because they can’t get any grant money and refuse to pull out student loans. I would hope these kinds of students would at least attend a community college but most of them won’t even talk to us.”
Vice President of the Nellie Mae Student Loan Center Marie O’Malley has conducted surveys of student loans over the past 15 years. O’Malley has discovered a substantial difference over the span of years. Her survey was based on the impact of debt burdens of paying back student loans after graduation. O’Malley conducted a random sample survey of students who have at least one federal loan and have completed a four year university. The results were the average student had $18,900 in student loans by the end of graduation, with a $182 monthly payment. The students who went on to graduate school ended up with an additional $23,700 in student loans.
This is only a small illustration of how student debt has affected society; some other stories are quite shocking. Programmer Officer Pamela Burdmen wrote an article on student debt and mentioned these three stories: the John Hopkins University Valedictorian who borrowed $101,000 in loans, the Boston resident who had a debt load of $80,000 and worked a $26,000 job and the student who was forced to drop out of college because they were $5,000 behind their payments. These examples should tell people that student debt needs to be assisted right away or these numbers will only continue to grow. Student debt can be improved with the work of increased access to need based student aid, allowing students to complete education at a reasonable price, strengthening consumer protections, and access to income based repayment.
Increasing access to need-based student aid will allow students to attain an education without financial being such an issue. Students of all backgrounds won’t have to borrow so much money for their education and will not have to work strenuous amounts of hours while attending a school. A student need-based aid will enable people to afford the cost of an education that they desire.
Students also need an access to income based repayment plans. Creating a repayment plan based off of one’s income and family size can set a reasonable time limit for that individual to pay back their loans. If students are unable to afford the repayment plan then the student needs to understand and be informed that there are other programs that will lower the monthly payments. If a family qualifies under the poverty class, then they would not have to make any federal payments as long as they remain at that level. This will allow students to pay for college efficiently and not be expelled for not making loan payments. More people need to be assured and confident that they can complete a successful education while using student loans. Student loans can have a drastic effect on a student who is trying to choose a college because of the price issue. This will enable students to complete a meaningful education at a reasonable price.
Students need to attain consumer protection rights that allow their investments to be secure. Borrowing money from a private owner can be a risky operation. A lot of the time, private student loan borrowers pull off dangerous practices so they can make more money .They deal a lot more with credit cards than they do with federal student loans. Private loans have much higher interest rates for people who can’t afford them. In 2008 the rates were up to 18% according to Baum. This destroys people’s credit and hurts them in the long run. Individuals need to be aware of these potentials and have rights where they can be refunded if abused.
Some believe finding a solution for student debt is near impossible at this time. We are in such a recession that there is no money to support these claims. If school tuition was to be lowered, then other factors like taxes would only elevate to counter balance the pricing. One may believe that there are more important issues to deal with such as the war in Iraq, Medicare, and other human resources. Educational Adviser Jane Wellman says, “The main reason tuition has been rising faster than a college cost is that colleges had to make up for reductions in the per-student subsidy state taxpayers.” Wellman believes there is no way to fix this problem and tuition is only going to escalate.
Improving student debt is a long term goal but can be turned around if action is taken forth immediately. There is no quick fix to this problem but my proposal will slowly turn the tables. If this situation continues to be ignored, then at this rate students will be paying more for less of an education. If we fine tune the areas of need based student aid, reasonable pricing, consumer protections, and income based repayment plans, then we can help solve student debt problems. Once all of these main reasons are applied together it will allow students to afford college and pursue in a career that they desire. College is about being successful not slaving away your time and dreading large bills. Taking this problem one step at a time will make more than a difference. This can help stabilize other economic issues as well. This approach is the best solution because it is organized and fair to society. The payment plans are all set up off of categorization and total income. Mathematically these numbers apply evenly to all citizens and therefore everyone is treated equally.
The numbers show that student debt is a major crisis for young people today. Not only is it financially destroying students but it is tearing apart other everyday life aspects and plans as well. College is a land of opportunity and should be a memorable time of your life. Any individual seeking for a higher level of education should be able to successfully complete college at a reasonable cost. Today’s economy is in a very rough environment right now but that is no excuse to not excel in this area. Regardless of any human resources or governmental costs we still need to provide a worthy education for students desperate to succeed. Students who do not attend college make less than a million dollars in their lifetime than someone who does attain a degree. If these numbers continue to skyrocket then it is hard to imagine how anyone will be able to afford a decent education. By breaking down this problem into sections and improving in each of these areas consistently, affording college will be much more efficient and reasonable. This is why the struggle with student debt can be improved with the work of increased access to need based student aid, allowing students to complete education at a reasonable price, strengthening consumer protections, and access to income based repayment.
Citations
Burdman, Pamela. “The Student Debt Dilemma.” The Student Debt Dilemma: Debt Aversion as a Barrier to College Access [eScholarship]. Oct. 2005. Web. 18 Apr. 2012. <http://escholarship.org/uc/item/6sp9787j>.
Baum, Sandy. “Students on Credit.” The Financial Aid Journal. 02 Feb. 2006. Web. 18 Apr. 2012.
Millet, CM. “Undergraduate Loan Debts.” JSTOR. Aug. 2003. Web. 18 Apr. 2012. <http://about.jstor.org/>.
Fisher, Jan. “Student Debt: Is Bankruptcy The Answer?” Investopedia. July 2005. Web. 18 Apr. 2012. <http://www.investopedia.com/articles/younginvestors/10/student-loan-bankruptcy.asp>.
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