08202017Headline:

Student Loans Impacting Our Financial Stability

By: Ricardo Betancourt

More students now than ever are refusing to pay their student loans even after former President Obama nationalized the student loan system with the intentions to help students in debt. A recent study by the Consumer Federation of America found that millions of people were in debt, with $137 billion in federal student loans in the first nine months of 2016, a 14 percent increase from 2015. The federal government’s outstanding student loans amount now stands at $1.3 trillion and rising every semester.

Roughly half of millennials believe that their student loans will be forgiven. The problem is, by reducing college tuition with cheap loans, the government only drives the price of tuition higher which is the reason tuition keeps rising. The spike in students avoiding their college debts hurts the economy, and hurts the credit score of the students.

More than half of college students (54 percent) chose to live at home to make school more affordable, according to Sallie Mae’s most recent How America Pays for College report. That’s up from 43 percent just four years ago. “Our research shows that families are making deliberate decisions to save on their college bills, and they are adopting multiple strategies to reduce the cost of college,” says Abigail Harper.

With $1.3 trillion in debt and 7 million jobs created for the 17 million students that graduated with at least an associate degree in 2016, it is obvious that it’s time for something to change in the way we look at our over saturated and overpriced colleges.

 

What Next?

Recent Articles