Debt is very common today for college students, maybe just too common. 66% of students are now borrowing for college at an average college debt of $24,000. That compares to 58% of students borrowing in 1999, but at an average $13,000 rate of debt.
This debt does afford a college education, but at what cost? College graduates have such high loan payments that the debt they take on for their education is causing them to put off marrying, buying a home, or having children. It is affecting their quality of living.
The more borrowing there is, interestingly, the more college prices continue to rise. When colleges have a buying public, they are likely to keep selling. Instead of cutting back where they should to adjust to the economic times, it’s easier to raise tuition. Too bad the buying public can no longer pay for what they are buying. Today tuition is growing at twice the rate of inflation.
Actually, this poor economy is helping students go further into debt for their educations. Federal Stafford loans, for example, have raised their borrowing limits from $23,000 to $31,000. It is true there is a bit of a silver lining to this borrowing cloud. With the higher federal loan limits, students are less likely to need riskier private loans. But, where are the limits on educational costs!
Unfortunately, both public and private colleges and universities are influential employers and benefit their communities. It is hard for local and state politicians to put financial stops on them.
So students and their families need to more carefully consider borrowing for college this spring as the acceptance letters come in. College debt will affect graduates’ lives. To help you consider you might want to read Collegebasics’ “Is Your College Education Worth Huge Financial Debt?”
Also both voting-aged students and their parents may want to begin to influence their Congressional delegation and their state politicians in the direction of limiting costs of education instead of increasing federal loan caps which”caps” future lives. In the meantime, look at Collegebasics’ Paying for College section.