Credit card debt has fallen behind student loans when it comes to the number one debt. It is starting to cost more to go to college, but credit card balances are being paid off. Many think this is happening because there has been less consumer protection. Others say college costs have risen beyond the return on investment in student loan debt. Meanwhile, research shows that many of the top growing job fields don’t require a bachelor’s degree.
College getting more costly when students take out more loans
The 2010 Federal Reserve figures show that $ 826.5 billion in revolving credit is had by Americans right now. FinAid.org compiled reports shown on the Wall Street Journal to show student loans totals to be at $ 829,785 billion. Student debt has gone up $ 300 billion in just the last four years, reports the Journal in an interview with Mark Kantrowitz who is the publisher of FinAid.org and FastWeb.com. There is a higher rate of unemployment and college costs more meaning parents borrow to get everything done.
Student loans lack consumer protections
Student loan debt is often times worse than credit card debt. Student loans usually can’t be written off in bankruptcy. Penalties worse than other credit lines are inflicted with student loan repayment that is not paid on time. According to Student Loan Justice, federal student loan borrowers have none of the consumer protections that come with credit card debt, including statutes of limitations, truth in lending laws, state usury laws and fair debt collection statutes. They say lending student loans is “an inherently predatory lending system that succeeds when the students fail.”
College costs enough to drain family finances
Tuition prices and student loan rates are rising together. 2009-2010’s average tuition prices for private colleges and in state tuition state colleges were $ 35,636 and $ 15,213, reports Bank Investment Consultant. These costs are rising by about 5 percent a year. This academic year, there is a possibility of charges going over $ 50,000 for top institutions. To cover such costs, families may have to use current income and spend savings also as borrow money.
Bachelor’s degrees worth dying
Rising student loan debt leads some to wonder whether going in hock for years to get a degree is worth it. As outlined by the New York Times, despite six years of trying, only half of all students starting a bachelor’s degree in 2006 will graduate by 2012. The Bureau of Labor Statistics reports that in the next ten years, seven of the thirty jobs expected to grow the fasted require a bachelor degree. You will find also 10 of the top growing job categories, 2 of which need degrees. Richard K. Vedder, founder of the Center for College Affordability and Productivity, told the Times that 15 percent of mail carriers have bachelor’s degrees, according to a 1999 federal study. He was quoted saying:
“Some of them could have purchased a house for what they spent on their education.”
Wall Street Journal
blogs.wsj.com/economics/2010/08/09/student-loan-debt-surpasses-credit-cards/
Bank Investment Consultant
bankinvestmentconsultant.com/bic_issues/2010_8/college-cost-gone-wild-2668047-1.html?zkPrintable=1 and amp;nopagination=1
New York Times
nytimes.com/2010/05/16/weekinreview/16steinberg.html
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