According to the 2007-08 undergraduate catalog, Malone tuition was $19,095 for commuters and $25,695 for residents. Four years later, the undergraduate catalog states that it costs $23,630 a year for commuters and $31,750 a year for residents.
“I had a goal to make it one year at a time without student loans,” senior political science major Luke Taylor said.
He was able to achieve his goal his first year at Barclay College in Kansas.
U.S. News & World Report says college loan debt exceeded credit card debt in 2010. This year student loan debt it is expected to reach $1 trillion.
According to expert Mark Kantrowitc, the country wide debt is increasing at $2,853.33 per second.
In 2010 the average college graduate had a loan debt of $25,000.
A survey conducted by The Institute for College Access & Success, Demos and Young Invincibles found that 76% of students said college has become more difficult to pay, but 8 in 10 believe college is more important than in previous generations.
When did this crisis happen?
According to finaid.com, over the past 17 years inflation in college tuition has been higher than inflation in the economy. However, there is no direct correlation between the inflation of money in the economy and college tuition as far as statistics are concerned.
The inflation of college tuition is usually 6.5 times higher than that of the economy, according to finaid.com.
According to collegeboard.org, financial aid and public school funding comes from the state in which the college or university is located.
The amount of financial aid has increased within the past 30 years by 42.7 percent, but private institutions are not funded in the same way and must increase the prices in order to compensate for the lack of federal funding.
At the beginning of each fiscal year, states are assessed for the importance shown to education. The amount of governmental aid varies from state to state depending on the value the state holds to education.
The part of the state budget set aside for education has changed because of the recession. It has created less money available for school funding, but there has been an increase in students enrolling in higher education institutions.
What is being done to stop this debt problem?
The government has several options to help those who are in debt. Also, the Occupy Wall Street movement has made student debt one of its priorities.
“I come from a single parent household,” Taylor said. “Squarely middle class.”
Taylor said he qualifies for federal loans and accredited school loans.
According to The Washington Post, President Barack Obama will issue executive order to initiate an accelerated “pay as you earn” program, which could help 1.6 million borrowers and lower their monthly payments a couple hundred dollars a month.
All remaining debt on federal loans would be forgiven within 20 rather than 25 years as in current law. To qualify for this program, students must have debt in the year 2012 or four years prior to that year.
The Washington Post also stated that those with more than one federal loan debt would be able to consolidate their debt reducing interest rates by up to half a percentage point.
What can be done now?
“My fiancée introduced me to the book Total Money Makeover by Dave Ramsey,” freshman nursing major Allie Klinger said.
Klinger suggested that all students read this book.
Here are some other alternatives to what Klinger has suggested.
- Avoid using a credit card to pay off loans or debt. According to US News it will create another line of credit for you to pay—the loan (line of credit one) and the card (line of credit two).
- If you borrow from a private loan company, make sure that that it is part of the Consumer Finance Protection Bureau (CFPB).
- According to the Department of Education website, deferment — the postponement of paying a loan without interest increasing for up to 3 years — can allow more time to pay off loans if you are enrolled in full-time graduate program or in an approved rehabilitation program. If you are in the U.S. Armed Forces or National Guard this may also apply.
- Forbearance temporarily makes the payment of the loan smaller, or extends the time of paying the loan.
- You can create a payment plan for student loans at studentloans.gov. It also gives you information on how to pay for different types of loans and ways to receive help.
The increasing problem of student loan debt is affecting the economy is a large way.
“Everyone says how bad the job market is,” freshman communication arts major Casey Stevens said. “Your debt right after college accumulates.”
Despite the debt crisis, some students feel confident about their future after graduation. Taylor, who wants to pursue a master’s in public policy, said he feels “pretty confident about the next five years.”
Klinger currently works as a state-tested nurse’s aid at a nursing home in North Canton and says she is not worried if she can’t find a nursing job right after school.
If you are interested in learning more about how debt is affecting the country, you can go to the World View Forum tonight at 7 p.m. in the Johnson Center.