Two of the most common pieces of financial advice you’ll hear is to avoid debt and, if you are in debt, to pay it off as quickly as you can. But that’s easier said than done.
Student loan debt in 2020 is around 1.6 trillion dollars and there are around 45 million borrowers in the United States alone, according to Forbes. Student loan debt is such a huge problem that Sports Illustrated editor Sarah Kelly drew attention to it by sharing her personal experience in a recent Twitter thread.
It went viral, as other Twitter users rushed to talk about their own student loan horror stories and just how predatory the system can be.
Sarah Kelly’s shared her thoughts about the American student loan system in a viral Twitter thread
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Kelly drew attention to the idea that families that can afford to pay their children’s tuition might actually end up paying less than the people who take out loans to finance their studies. Her words reached a lot of people: 362.8k liked what she had to say and 55.5k retweeted her message.
US student loan debt is the second-highest consumer debt category in the country, right behind mortgage debt but ahead of credit card and auto loans. The Institute for College Access and Success states that the average student debt of Americans who graduated in 2018 was 29.2k dollars. And that’s just the average!
Whether we like it or not, college is getting more expensive. The cost of a 4-year degree has increased by 25 percent while student debt has risen by 107% since the 2008 recession.
However, not going to college is not an option for some high school graduates. CNBC reports that those who have a college degree earn on average 80 percent more than people with just a high school diploma.
So going to college means investing in your future, but it can also mean going into debt. So it’s a tough choice to make, especially during the coronavirus pandemic which has put a lot of pressure on not just the US but also other countries’ economies.
Other people shared their thoughts about student loans in the US as well
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America was somewhere I dreamed of and always wanted to go to when i was younger. Now, it seems that nothing is fair in America. Rights, healthcare, school, the people. My younger conceptions of America are ruined by what i have seen since the last 5 years. There isn't much in America that sounds fair anymore. (sorry for listening to my sad speech)
It was the same for me but I was lucky enough to go about 20 years ago, long before the troubles now. I wonder now though, whether the place I dreamt of and saw (probably through rose-tinted glasses) ever existed in the first place. Sure, Trump wasn't there but the racism and the hate, the inequality and the huge divide between the rich and poor, they were always there.
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I was upset my daughter chose not to go to college, and then I hear about these horror stories. She cleans houses and businesses, 30-40 hours a week, makes as much as most BAs. In the eighties you could literally work your way through most colleges, waiting tables, few if any loans, and come out the other side owing very little or nothing, and get a job that actually paid. I wait tables (pre-Covid) and make as much or more than many with a BA. That added education used to be worth it, now it's just a scam
As much as the student loan system is screwed up, there has to be an examination of how much Colleges and universities charge for tuition. You have to look across the years and see how much they have raised the cost to go to college and how that out paced inflation.
The increased costs of 'administration' at most universities and colleges is absurd. You get NOTHING for all the admin people hired. But it does increase the cost of higher education. Plus look at all the endowments that many universities have - sometimes billions of dollars. What is that being used for. I do feel sorry for these individuals, but their solution (free education) just makes the problem work. People have to start NOT buying into the myth that high education is the solution to a good life.
Load More Replies... I saved money, went to a very low cost, low prestige university, worked two jobs, then went to a different low cost, low prestige university working up to three jobs. Never borrowed anything to do it. Please don't borrow to go to school. I know it gets normalized, seems like that's what everyone does, but it can be done without loans.
Maybe in HS math class you should have paid attention to what's called "Compound Interest", it would have saved you a lot of money.
You don't need to learn about compound interest to see that it's not the problem here. The problem is the structure of the loan. If you think that compound interest is the problem you've completely misunderstood the root of the problem.
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We get what we deserve. When I see someone proudly displaying their flag on their vehicle...I think to myself, "Do you have any idea how much better this country would be if we were like other countries?" Free education, free health care. with higher taxes. More maternity leave, more days off...Yet you have these folks that have never left the country, much less their home state, who think Murica' is the greatest country on earth.
Americans don't go anywhere (factually, vast majority of Americans travel for business only). They are as deluded as Russians and North Koreans as nothing beats the USA, right? Arrogance of Americans is founded in a lack of knowledge of another way. More food is better right? Bigger cars is better right? All work and no play is better right?
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Education is a skill which helps you understand how stuff around you works and why. If you don't understand why you have to pay what you signed up to pay, then your education is evidently worthless.
$300,000 in loans for medical school. I have been a doctor for 10 years. I pay $3-4K a month, and have worked two jobs 6 out of those 10 years to make extra loan payments. Current balance: $265,000. Just because my paycheck starts out big, don’t assume it makes me rich at the end of the day. Between student loans and taxes, over 60% of my income goes straight back to the government.
As someone on disability, when I can work, my income gets clawed back 50% after I make $200. I’m told it puts me ahead, but I’m in a worse spot now than ever.
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People should never have encouraged so many to go to a university right out of high school. A lot of people with student loans aren't even using their degrees, or never even graduated. Community college is a valid option for a ton of people. Who cares if it's "looked down on" by your classmates or their parents? YOU'RE the one who has to pay back the loans, not them. Ridiculous that 18 year olds are expected to know what they want to do for the rest of their lives.
I agree with you completely. I am glad that I have a 4-year degree, but my job really only requires a 2-year CC or technical school degree. It's interesting how many of my peers studied programs which left them with little in the way of employable skills.
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I graduated prior to Obama and got all of my student loans at 2%. In 2010 Obama eliminated the Federal Guaranteed Loan Program and rates skyrocketed. So glad I graduated before Obama's change.
Thinking about it, I think he did this on purpose to make rates so high Dems could influence the vote by offering to pay off student loans. IF this is true that would be truly evil.
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In most countries in Europe, if not all, education is cheap. Not for free, to avoid abuse (you could study until you are 60), but basically the government invests in your education, as a better job will bring in more taxes. What you can study is determined by your IQ, not by your wallet!
I don't see how any tuition would be a measure against abuse. I paid 10€/year. The student discounts in the lunch cafeterias alone pays that back in a week. If you don't graduate in ~6 years, the uni kicks you out. Also, salaries jump significantly for graduates, so "abusing" the system would be a net loss for you. Also the government paid student "welfare" is limited to ~5 years, so after that you must work to earn a living.
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After 2 years of college in the late 80s, I realized I was going to have to take out loans in order to finish. Many of my friends who had graduated were really struggling with their loan payments, and I didn't want that for myself. I ended up finding a job where I could apprentice myself to learn to do audio work for the film industry, and I've made a decent living from that for almost 30 years. Of course, if you have dreams of a specific career that requires a degree, loans may be your only option. But if you just want to make a decent living, there are skilled trades where you can make good money, and the training is much cheaper than a university degree. (I have a relative who quit her job as a teacher to go beauty school, and she makes much better money as a hair stylist.) The education industry likes to scare people into thinking they'll be poor for the rest of their lives if they don't get an expensive university degree, but it's not always true.
Look one, two decades ahead - people aren't studying anything because they expect higher wages, higher standard of living, but only those do who are totally committed, and basically want to make a difference and see the required education for that purpose won't be in reach without. This, I expect to result in a decline of the number of academically educated people in one, two decades ... a decline of overall education ... a decline of people available you might need in order to even survive, like MDs and the like ... this system is as f****d up as it gets, and even beyond!
The cost of higher education in the US is criminal. Tuition is also going up a lot in Spain (where I live), but I think it's still generally manageable. I must be extremely lucky, since what I studied was actually one of the cheaper programs: I went to uni from 2002 - 2006 and finished with a degree in translation and a postgrad in legal translation. My mother and I paid between €1,000 and €600 PER YEAR, depending on how many classes I was taking, so we didn't have to get any loans. The university also allowed students to pay in two installments and it was interest-free. My postgraduate degree cost €1,200. A few years later, I studied a master's and got a scholarship, so I only paid around €900 for it (out of pocket, again). Just this month, I completed my second master's degree and paid €3,000 for it in three installments, interest-free. The university itself is the one who offers these payment plans. This is what higher education should be, not the barbaric sums paid in America. :-(
The professors need good wine to write angry tweets at Trump.
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I'm not familiar with this but it looks like you could get a better deal from your local Mob loan shark.
Secretary of Eduation Betsy DeVos realizes several billion annually in profit from her investments in student loan companies. The biggest sign that Student Loans are a SCAM is that they can't be discharged through bankruptcy. Why is it so important to politicians to hamstring people for life? Oh, because they have investments.
Just remember how socialist programs like single payer healthcare and free college is bad. They just don't complete the sentence. It should read "Socialist programs like single payer healthcare and free college are bad for banks, for-profit healthcare providers, and investors." Now lets go privatize the post office
I am an artist and at 16 was selling my paintings in galleries and hated school "learning", so I dropped out. But due to my mental health issues, my mother insisted I take enough college classes to keep my parents insurance. So with her "guidance", I took out 3 $5000 dollar loans and did 2 years of college. I never graduated. I ended up having a mental health crisis at the age of 18 and spent a year in a hospital. I became a tattoo artist and have been tattooing for over 20 years now. My credit is in shambles because I could not afford the 450$ monthly payments from my student loans. I could only afford 150$ a month. To this day, I owe them over 50,000$ for 15,000$ I borrowed at 16 for an education I didn't want just to keep my insurance so I could get mental health care. Thank you, America. It's been swell.
I didn't have to pay a lot the first year of college... UNTIL FAFSA DID A CHECK ON ME. Now we didn't get in trouble because we genuinely thought we were honest 100% on the FAFSA paperwork (for non-American Pandas, it's essentially asking the government for support with tuition). However, turns out that it is important that we rent the top floor of our house. It is three small rooms. Three small rooms mean nothing to the government. Rent = You have half the value of your house in investments. This essentially means I have $180,000 dollars in investments for renting out a small bedroom, kitchen, and bathroom. I lost all my funding for the remaining three years. Tuition costs $20,000 a year, We get a profit of $600 a year from rent. But no, we're rich because we have 180k in investments, we can afford college.
The problem is not with the amounts of the loans, the problem lies either in how they are set up or in how the applicant decides how to pay it back. If the interest charged every month is $1000 and your payment is for $900, you will be in a situation where you owe more and more. Most people with student loans are choosing super low payments that do not cover the amount of interest every month and by law some of each payment must be applied to the principal. You cannot just sit and complain and demand that the government wipes out student loans, what would happen in the situations where the person paid it off? Revise the loans so that there is a minimum payment that covers ALL of the interest each month as well as some principal and you will no longer have a situation where you owe more than the original amount owed after X number of years.
Very little information on the type of degree received - a few law schools degrees. People have been sold a lie that college/university is a must. As Mike Rowe has shown there is lots of good jobs that require hard work, but no advanced degrees. Any degree that ends in Studies (native studies, women studies, gender studies, media, film, environmental etc. etc) are con jobs. There are too many lawyers so you end up working for pennies and long hours. I feel sorry for these individuals, but make better choices.
Did you take any math classes since middle school? Learned anything about Compounding interest? Or only how you have been "wronged by the system"? Nobody forced you to go to college, kid. 2 year vocational school with most states lottery-funded (= stupid tax on another subset of people who can't do math, to fund other people hopefully going to college to learn math) makes this within reach of many of those willing To live at home, commute, bring their lunch and Work part time during School. By your own account is was "dumb" to borrow that much money. I agree. Why should you being dumb make the rest of us feel like We're supposed to pay for it?
Cuz "socialism" and "the rich are evil". Actually this is just and excuse to get money without having to work for it.
Load More Replies... Must be above market rate interest to accumulate like that. Since free market rates are ~0.3 % presently in the US (that's 500$ yearly on a 200k loan...). You really should try free-market capitalism in the US. It works.
Load More Replies... If you don’t get a degree in Barista then you will make enough to pay off your debts. You will have to live like you are poor (newsflash, you are if you owe a ton of money in student loans) and may need a second job but it isn’t that difficult. I did it so I know what I am talking about. You say education should be free? Nothing is free. Your “free” education or interest free loan would be paid for using someone elses tax dollars. You expect me to fund your college with my tax dollars so you can get a high paying job? Predatory lending? I work in finance so I’m not buying it. There are consumer protection laws that require lenders to disclose the terms of loans six ways from Sunday. If you are smart enough to attend college, then you understand the loan terms. Stop about your student loan debt and pay it off. Google “how to pay off student loans”. There are tons of resources available to help you. It won’t be easy but it can be done and it beats crying about it.
can somebody please explain how even when people pay off their debt they still have to pay even more? i'm incredibly confused as to why this is because it makes no sense and they're literally just taking money from you and saying you owe them. how is that even allowed/fair? it's completely and utterly ridiculous!
This was in the late 90's and early 2000's, but a few years after college I was able to defer the payments on my $23k school loan. Within that time I bought a modest house. I let two years go by and found the value had increased on the house so I refinanced to pay off my school loan and wrapped it into my low interest rate mortgage. It bumped my mortgage payments up by about $350, but it's a whole lot less than the loan payments would have been, and I've already paid off my loan via my mortgage within about 7 years. Also to keep costs down I went to community college in my state/county for my first two years - also getting my academic classes out of the way, then I transferred to a university to finish my last two years while focusing on my major. It's often not worth it to spend so much on a big wig expensive school either. Check out what Malcolm Gladwell said about his college choice to stay in the community system and how it turned out for the better.
That compound interest is a killer.... never pay the minimum payment amount...
Those lenders are blood-sucking criminals, and they belong in prison!
A single mother on welfare, I borrowed $3000 from the govt. in 1990. I now owe them $12,000.
I live in the netherlands so interest on student loans makes no sense to me, but then cost of education in murica makes even less sense, and what you actually get for that price even less than that. I literally do not understand why people are swimming TO murica instead of from it.
President Barack Obama tried to abolish the interest due on student loans.
The source of this money is the US-f*****g-Treasury! The loan the money to private financial institutions at less than 3% interest (0.5% lately) who add lots of service fees and guarantee these people, the future of their country, are indentured servants for ever. Education should be an investment in a country's future, not a get rich quick scheme for its most avaricious.
Yes, student loan interest is compounded. Many people choose to make minimal payments rather than pay down the loan. Plus, many student loans have high interest rates, such as 8%. And student loans cannot be discharged through bankruptcy. Almost everything else can be discharged through bankruptcy, but not student loan debt. Two of my adult children have had more debt in student loans than my husband and I ever owed on a mortgage. I consider the current student loan issue a problem of the same type of what were known as "company stores" found in company towns back early in the 20th century where the employees had to buy their food and goods from the company store on credit without the ability to ever pay their bill down due to poor wages, working conditions, and no benefits. Our public and private finance leaders are mortaging our country's future on the backs of our workforce rather than helping them become independent wealth producers.
I went to college in the 1970-80's. Debt was very hard to get whether student loans, mortgages, credit cards, etc. Very difficult. As a result, the economy, including tuition, respected that limitation. University's tuition had to remain affordable to recruit students. Lo and behold, easy debt and easy credit allowed universities to spend, spend, spend on administration, fancy student apartments (rather than those old dorms), etc. Students' expectations for the good life while at college also increased. Nearly all universities and colleges have renovated their old-style dorms to nice apartments that house fewer students. It is possible to get a good education affordably as a few contributors have noted. If many more students and their parents chose affordable schooling, universities would either have to conform or go out of business.
If I were the government leaders all rolled into one, I'd make the interest on student loans = prime rate plus .5 % (perhaps retroactive for half the loan or something negotiable). Someday this house of cards of mountainous debts with usury rates will come crashing down. Perhaps the pandemic will hasten that day.
I have two associates degrees and am three credits away from my bachelors. I took all my gen ed classes at a community college which saves a c**p ton of money, applied for literally HUNDREDS of scholarships, didn't choose the most expensive school out there, and budgeted in between semesters. I lived at home, bought my books used... but most importantly I READ THE PAPERWORK - the loan paperwork clearly outlines interest and payments, and if you cannot afford it then you JUST DON'T SIGN. Get creative, don't major in b******t (I'm looking at you - yeah, you... the bonehead who chose to go to a $30k a year school to major in liberal arts or gender studies) It is possible to graduate with little to no debt if you are smart about it. I am happy to say that I will have ZERO debt when I am finished this semester.
I met a dentist here in Canada that was trained in the U.S. He had over $400k in outstanding student loans and planned to live with his parents for a few years so he could afford to pay them off. He had his own practice and couldn't afford to live like a normal working person becuase of his loan debt.
I live in the Czech Republic (Middle Europe). Can someone explain the student loan system to me? How Is that possible, that those people pay their loans and after 10-15 years still owe more that they've got 🤔 There aren't any contracts, fixed interests or something? My husband and I borowed recently a lot of money to buy a garden. We do know, how much we have to return, how expensive the loan is (4% p.a.) and when every single Penny is paid back.
I was lucky enough to earn a full ride to the school of my choice and I only had to pay living expenses. Luckily, I was able to work on campus and had a couple of side hustles to pay to live on campus (back then that was cheaper than living off campus and the nuns would let you do laundry at their place). I know a lot of people aren't and it is sad. Very very sad.
In Norway education is basically free, even law and medical school. We only take loans to pay normal life expenses, like food and rent. When you're done you pay $150 each month for about twenty years, and you're done with the loan. Also, if you get injured or chronically ill and are unable to work anymore, your debt is deleted. This is run by our government.
The public education is terrible in America. That's Problem One. A large chunk of college is to teach students what they should have learned in high school at the latest. At graduation of high school, a person has no more useful skills for the job market than a person who dropped out, other than a diploma which is worth less than the paper its written on, except to remove artificial barriers.
Why aren’t people borrowing from their local money shark? seems much more prudent than this.
I just don't get this American debt dream 🤷🏻♀️ In my country, healthcare is free. One can have major surgery or give birth to 10 children, all for free. Education is also free and these crazy interests are not allowed by law. For example, student loan interest in my country is 5% in YEAR, thats it.
I experienced the same issues with student loans owing over 100k & working for the public/county. My loans are on hold due to Covid-19 & l am I hoping for relief real soon.
I dont get it. I am from germany. I had students loa n for a private university as well. It was more abour a credit of 8k. Hat to pay back about 12k in 4years. These four years with just a small sallary were tough, but managable. Since than I have nothing to pay back and can live my life. Why are there those unfair conditions in the US with student loans. Everybody loses if you cant pay the back...
I paid off my $32k student loans. Took about a decade. I refinanced and consolidated shortly after graduation. I started pre-veterinarian but switched to nursing after doing the math on what I would owe. I started working after my bachelor's rather than rolling debt into a master's degree. A lot of these posts are from people with 6+ years of education and accumulation of debt. Did those folks not take a math class?
Not a college but went to cosmetology school. Had two loans I signed for and had to pay back on 6 months after getting my state boards passed (97%!). Was paying and paying and paying when I realized the school forged my name and took two additional loan out (one of each) and pocketed that money. So I had to pay double on two loans. $26kX2. Took me 15 years but did it. Found out when I thought I had them paid off but got a collections letter for the doubles. I even showed payments but school had closed and no records. Made no sense but I owed it. Get your own loans for things at rates you can deal with. I've learned that.
The problem here is the stupidity of the students. Not all jobs that can pay well require graduate degrees, and the students should know to leave degrees that have little value in the marketplace to the ones privileged enough to not worry about wasting their time and money. Your gender studies degree will get you nowhere except being in dept and a burden to the economy.
Exactly. Stop complaining about the loans you signed to get your doctorate in gender studies.
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Anyone that thinks our politicians are going to do anything about this are deluded. Banks own them, and the banks only care about making their money. If, by any slim chance our politicians decide to do something, it will be minor and only benefit a small portion of student borrowers. There will be so many requirements and qualifiers that only a small fraction of student borrowers will be helped. Just like everything else our politicians do; they do the least amount that will get people off their backs and get them re-elected.
The sad thing is many of us spent so much money on a degree and then can’t find a job with the degree. All the offices or companies you want to work at want you to basically be an expert to get an entry level job.
The choice of major has a lot to do with it. There have always been useless degrees but they've become the majority now. Study something practical and you'll get a job.
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Ok, you american boys and girls, listen up! Apply for universities in Canada, UK, Australia or literally any other country in the world. Education might be lower quality, but at least free'sh of debt AND you get to travel! Punish business with your wallets
America doesn't want things to change… correction… PRIVILEDGED american and REDNECKS american doesn't want things to change. we saw it these day with 'Murican who beat BLM people on the street and doesn't want to wear mask. this country couldn't be any low in the shithole
I come from a long proud line of rednecks, and we a definitely not the problem. The main problem is the proportion of truly 'average' people who have been brainwashed into thinking that rich people's problems are their problems too, and they need to vote to support what rich people want, rather than for representatives who support programs which will actually do good in the world.
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Stop crying it's you who signed the loan.You knew what the loan Intailed. If you didn't your own dumb fault for not reading your plan. So sick of people crying ITS YOUR OWN FAULT.
Socialism! At least in the capitalist Nordic welfare system, market rates are good enough! (BTW, is the EURIBOR still negative?)
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Between health insurance and student loan payments, how do American afford to live? Socialism isn't a scary as you think it is.
Socialism will scare away investors. For the USA, this is terrifying.
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America was somewhere I dreamed of and always wanted to go to when i was younger. Now, it seems that nothing is fair in America. Rights, healthcare, school, the people. My younger conceptions of America are ruined by what i have seen since the last 5 years. There isn't much in America that sounds fair anymore. (sorry for listening to my sad speech)
It was the same for me but I was lucky enough to go about 20 years ago, long before the troubles now. I wonder now though, whether the place I dreamt of and saw (probably through rose-tinted glasses) ever existed in the first place. Sure, Trump wasn't there but the racism and the hate, the inequality and the huge divide between the rich and poor, they were always there.
Load More Replies... I was upset my daughter chose not to go to college, and then I hear about these horror stories. She cleans houses and businesses, 30-40 hours a week, makes as much as most BAs. In the eighties you could literally work your way through most colleges, waiting tables, few if any loans, and come out the other side owing very little or nothing, and get a job that actually paid. I wait tables (pre-Covid) and make as much or more than many with a BA. That added education used to be worth it, now it's just a scam
As much as the student loan system is screwed up, there has to be an examination of how much Colleges and universities charge for tuition. You have to look across the years and see how much they have raised the cost to go to college and how that out paced inflation.
The increased costs of 'administration' at most universities and colleges is absurd. You get NOTHING for all the admin people hired. But it does increase the cost of higher education. Plus look at all the endowments that many universities have - sometimes billions of dollars. What is that being used for. I do feel sorry for these individuals, but their solution (free education) just makes the problem work. People have to start NOT buying into the myth that high education is the solution to a good life.
Load More Replies... I saved money, went to a very low cost, low prestige university, worked two jobs, then went to a different low cost, low prestige university working up to three jobs. Never borrowed anything to do it. Please don't borrow to go to school. I know it gets normalized, seems like that's what everyone does, but it can be done without loans.
Maybe in HS math class you should have paid attention to what's called "Compound Interest", it would have saved you a lot of money.
You don't need to learn about compound interest to see that it's not the problem here. The problem is the structure of the loan. If you think that compound interest is the problem you've completely misunderstood the root of the problem.
Load More Replies... We get what we deserve. When I see someone proudly displaying their flag on their vehicle...I think to myself, "Do you have any idea how much better this country would be if we were like other countries?" Free education, free health care. with higher taxes. More maternity leave, more days off...Yet you have these folks that have never left the country, much less their home state, who think Murica' is the greatest country on earth.
Americans don't go anywhere (factually, vast majority of Americans travel for business only). They are as deluded as Russians and North Koreans as nothing beats the USA, right? Arrogance of Americans is founded in a lack of knowledge of another way. More food is better right? Bigger cars is better right? All work and no play is better right?
Load More Replies... Education is a skill which helps you understand how stuff around you works and why. If you don't understand why you have to pay what you signed up to pay, then your education is evidently worthless.
$300,000 in loans for medical school. I have been a doctor for 10 years. I pay $3-4K a month, and have worked two jobs 6 out of those 10 years to make extra loan payments. Current balance: $265,000. Just because my paycheck starts out big, don’t assume it makes me rich at the end of the day. Between student loans and taxes, over 60% of my income goes straight back to the government.
As someone on disability, when I can work, my income gets clawed back 50% after I make $200. I’m told it puts me ahead, but I’m in a worse spot now than ever.
Load More Replies... People should never have encouraged so many to go to a university right out of high school. A lot of people with student loans aren't even using their degrees, or never even graduated. Community college is a valid option for a ton of people. Who cares if it's "looked down on" by your classmates or their parents? YOU'RE the one who has to pay back the loans, not them. Ridiculous that 18 year olds are expected to know what they want to do for the rest of their lives.
I agree with you completely. I am glad that I have a 4-year degree, but my job really only requires a 2-year CC or technical school degree. It's interesting how many of my peers studied programs which left them with little in the way of employable skills.
Load More Replies... I graduated prior to Obama and got all of my student loans at 2%. In 2010 Obama eliminated the Federal Guaranteed Loan Program and rates skyrocketed. So glad I graduated before Obama's change.
Thinking about it, I think he did this on purpose to make rates so high Dems could influence the vote by offering to pay off student loans. IF this is true that would be truly evil.
Load More Replies... In most countries in Europe, if not all, education is cheap. Not for free, to avoid abuse (you could study until you are 60), but basically the government invests in your education, as a better job will bring in more taxes. What you can study is determined by your IQ, not by your wallet!
I don't see how any tuition would be a measure against abuse. I paid 10€/year. The student discounts in the lunch cafeterias alone pays that back in a week. If you don't graduate in ~6 years, the uni kicks you out. Also, salaries jump significantly for graduates, so "abusing" the system would be a net loss for you. Also the government paid student "welfare" is limited to ~5 years, so after that you must work to earn a living.
Load More Replies... After 2 years of college in the late 80s, I realized I was going to have to take out loans in order to finish. Many of my friends who had graduated were really struggling with their loan payments, and I didn't want that for myself. I ended up finding a job where I could apprentice myself to learn to do audio work for the film industry, and I've made a decent living from that for almost 30 years. Of course, if you have dreams of a specific career that requires a degree, loans may be your only option. But if you just want to make a decent living, there are skilled trades where you can make good money, and the training is much cheaper than a university degree. (I have a relative who quit her job as a teacher to go beauty school, and she makes much better money as a hair stylist.) The education industry likes to scare people into thinking they'll be poor for the rest of their lives if they don't get an expensive university degree, but it's not always true.
Look one, two decades ahead - people aren't studying anything because they expect higher wages, higher standard of living, but only those do who are totally committed, and basically want to make a difference and see the required education for that purpose won't be in reach without. This, I expect to result in a decline of the number of academically educated people in one, two decades ... a decline of overall education ... a decline of people available you might need in order to even survive, like MDs and the like ... this system is as f****d up as it gets, and even beyond!
The cost of higher education in the US is criminal. Tuition is also going up a lot in Spain (where I live), but I think it's still generally manageable. I must be extremely lucky, since what I studied was actually one of the cheaper programs: I went to uni from 2002 - 2006 and finished with a degree in translation and a postgrad in legal translation. My mother and I paid between €1,000 and €600 PER YEAR, depending on how many classes I was taking, so we didn't have to get any loans. The university also allowed students to pay in two installments and it was interest-free. My postgraduate degree cost €1,200. A few years later, I studied a master's and got a scholarship, so I only paid around €900 for it (out of pocket, again). Just this month, I completed my second master's degree and paid €3,000 for it in three installments, interest-free. The university itself is the one who offers these payment plans. This is what higher education should be, not the barbaric sums paid in America. :-(
The professors need good wine to write angry tweets at Trump.
Load More Replies... I'm not familiar with this but it looks like you could get a better deal from your local Mob loan shark.
Secretary of Eduation Betsy DeVos realizes several billion annually in profit from her investments in student loan companies. The biggest sign that Student Loans are a SCAM is that they can't be discharged through bankruptcy. Why is it so important to politicians to hamstring people for life? Oh, because they have investments.
Just remember how socialist programs like single payer healthcare and free college is bad. They just don't complete the sentence. It should read "Socialist programs like single payer healthcare and free college are bad for banks, for-profit healthcare providers, and investors." Now lets go privatize the post office
I am an artist and at 16 was selling my paintings in galleries and hated school "learning", so I dropped out. But due to my mental health issues, my mother insisted I take enough college classes to keep my parents insurance. So with her "guidance", I took out 3 $5000 dollar loans and did 2 years of college. I never graduated. I ended up having a mental health crisis at the age of 18 and spent a year in a hospital. I became a tattoo artist and have been tattooing for over 20 years now. My credit is in shambles because I could not afford the 450$ monthly payments from my student loans. I could only afford 150$ a month. To this day, I owe them over 50,000$ for 15,000$ I borrowed at 16 for an education I didn't want just to keep my insurance so I could get mental health care. Thank you, America. It's been swell.
I didn't have to pay a lot the first year of college... UNTIL FAFSA DID A CHECK ON ME. Now we didn't get in trouble because we genuinely thought we were honest 100% on the FAFSA paperwork (for non-American Pandas, it's essentially asking the government for support with tuition). However, turns out that it is important that we rent the top floor of our house. It is three small rooms. Three small rooms mean nothing to the government. Rent = You have half the value of your house in investments. This essentially means I have $180,000 dollars in investments for renting out a small bedroom, kitchen, and bathroom. I lost all my funding for the remaining three years. Tuition costs $20,000 a year, We get a profit of $600 a year from rent. But no, we're rich because we have 180k in investments, we can afford college.
The problem is not with the amounts of the loans, the problem lies either in how they are set up or in how the applicant decides how to pay it back. If the interest charged every month is $1000 and your payment is for $900, you will be in a situation where you owe more and more. Most people with student loans are choosing super low payments that do not cover the amount of interest every month and by law some of each payment must be applied to the principal. You cannot just sit and complain and demand that the government wipes out student loans, what would happen in the situations where the person paid it off? Revise the loans so that there is a minimum payment that covers ALL of the interest each month as well as some principal and you will no longer have a situation where you owe more than the original amount owed after X number of years.
Very little information on the type of degree received - a few law schools degrees. People have been sold a lie that college/university is a must. As Mike Rowe has shown there is lots of good jobs that require hard work, but no advanced degrees. Any degree that ends in Studies (native studies, women studies, gender studies, media, film, environmental etc. etc) are con jobs. There are too many lawyers so you end up working for pennies and long hours. I feel sorry for these individuals, but make better choices.
Did you take any math classes since middle school? Learned anything about Compounding interest? Or only how you have been "wronged by the system"? Nobody forced you to go to college, kid. 2 year vocational school with most states lottery-funded (= stupid tax on another subset of people who can't do math, to fund other people hopefully going to college to learn math) makes this within reach of many of those willing To live at home, commute, bring their lunch and Work part time during School. By your own account is was "dumb" to borrow that much money. I agree. Why should you being dumb make the rest of us feel like We're supposed to pay for it?
Cuz "socialism" and "the rich are evil". Actually this is just and excuse to get money without having to work for it.
Load More Replies... Must be above market rate interest to accumulate like that. Since free market rates are ~0.3 % presently in the US (that's 500$ yearly on a 200k loan...). You really should try free-market capitalism in the US. It works.
Load More Replies... If you don’t get a degree in Barista then you will make enough to pay off your debts. You will have to live like you are poor (newsflash, you are if you owe a ton of money in student loans) and may need a second job but it isn’t that difficult. I did it so I know what I am talking about. You say education should be free? Nothing is free. Your “free” education or interest free loan would be paid for using someone elses tax dollars. You expect me to fund your college with my tax dollars so you can get a high paying job? Predatory lending? I work in finance so I’m not buying it. There are consumer protection laws that require lenders to disclose the terms of loans six ways from Sunday. If you are smart enough to attend college, then you understand the loan terms. Stop about your student loan debt and pay it off. Google “how to pay off student loans”. There are tons of resources available to help you. It won’t be easy but it can be done and it beats crying about it.
can somebody please explain how even when people pay off their debt they still have to pay even more? i'm incredibly confused as to why this is because it makes no sense and they're literally just taking money from you and saying you owe them. how is that even allowed/fair? it's completely and utterly ridiculous!
This was in the late 90's and early 2000's, but a few years after college I was able to defer the payments on my $23k school loan. Within that time I bought a modest house. I let two years go by and found the value had increased on the house so I refinanced to pay off my school loan and wrapped it into my low interest rate mortgage. It bumped my mortgage payments up by about $350, but it's a whole lot less than the loan payments would have been, and I've already paid off my loan via my mortgage within about 7 years. Also to keep costs down I went to community college in my state/county for my first two years - also getting my academic classes out of the way, then I transferred to a university to finish my last two years while focusing on my major. It's often not worth it to spend so much on a big wig expensive school either. Check out what Malcolm Gladwell said about his college choice to stay in the community system and how it turned out for the better.
That compound interest is a killer.... never pay the minimum payment amount...
Those lenders are blood-sucking criminals, and they belong in prison!
A single mother on welfare, I borrowed $3000 from the govt. in 1990. I now owe them $12,000.
I live in the netherlands so interest on student loans makes no sense to me, but then cost of education in murica makes even less sense, and what you actually get for that price even less than that. I literally do not understand why people are swimming TO murica instead of from it.
President Barack Obama tried to abolish the interest due on student loans.
The source of this money is the US-f*****g-Treasury! The loan the money to private financial institutions at less than 3% interest (0.5% lately) who add lots of service fees and guarantee these people, the future of their country, are indentured servants for ever. Education should be an investment in a country's future, not a get rich quick scheme for its most avaricious.
Yes, student loan interest is compounded. Many people choose to make minimal payments rather than pay down the loan. Plus, many student loans have high interest rates, such as 8%. And student loans cannot be discharged through bankruptcy. Almost everything else can be discharged through bankruptcy, but not student loan debt. Two of my adult children have had more debt in student loans than my husband and I ever owed on a mortgage. I consider the current student loan issue a problem of the same type of what were known as "company stores" found in company towns back early in the 20th century where the employees had to buy their food and goods from the company store on credit without the ability to ever pay their bill down due to poor wages, working conditions, and no benefits. Our public and private finance leaders are mortaging our country's future on the backs of our workforce rather than helping them become independent wealth producers.
I went to college in the 1970-80's. Debt was very hard to get whether student loans, mortgages, credit cards, etc. Very difficult. As a result, the economy, including tuition, respected that limitation. University's tuition had to remain affordable to recruit students. Lo and behold, easy debt and easy credit allowed universities to spend, spend, spend on administration, fancy student apartments (rather than those old dorms), etc. Students' expectations for the good life while at college also increased. Nearly all universities and colleges have renovated their old-style dorms to nice apartments that house fewer students. It is possible to get a good education affordably as a few contributors have noted. If many more students and their parents chose affordable schooling, universities would either have to conform or go out of business.
If I were the government leaders all rolled into one, I'd make the interest on student loans = prime rate plus .5 % (perhaps retroactive for half the loan or something negotiable). Someday this house of cards of mountainous debts with usury rates will come crashing down. Perhaps the pandemic will hasten that day.
I have two associates degrees and am three credits away from my bachelors. I took all my gen ed classes at a community college which saves a c**p ton of money, applied for literally HUNDREDS of scholarships, didn't choose the most expensive school out there, and budgeted in between semesters. I lived at home, bought my books used... but most importantly I READ THE PAPERWORK - the loan paperwork clearly outlines interest and payments, and if you cannot afford it then you JUST DON'T SIGN. Get creative, don't major in b******t (I'm looking at you - yeah, you... the bonehead who chose to go to a $30k a year school to major in liberal arts or gender studies) It is possible to graduate with little to no debt if you are smart about it. I am happy to say that I will have ZERO debt when I am finished this semester.
I met a dentist here in Canada that was trained in the U.S. He had over $400k in outstanding student loans and planned to live with his parents for a few years so he could afford to pay them off. He had his own practice and couldn't afford to live like a normal working person becuase of his loan debt.
I live in the Czech Republic (Middle Europe). Can someone explain the student loan system to me? How Is that possible, that those people pay their loans and after 10-15 years still owe more that they've got 🤔 There aren't any contracts, fixed interests or something? My husband and I borowed recently a lot of money to buy a garden. We do know, how much we have to return, how expensive the loan is (4% p.a.) and when every single Penny is paid back.
I was lucky enough to earn a full ride to the school of my choice and I only had to pay living expenses. Luckily, I was able to work on campus and had a couple of side hustles to pay to live on campus (back then that was cheaper than living off campus and the nuns would let you do laundry at their place). I know a lot of people aren't and it is sad. Very very sad.
In Norway education is basically free, even law and medical school. We only take loans to pay normal life expenses, like food and rent. When you're done you pay $150 each month for about twenty years, and you're done with the loan. Also, if you get injured or chronically ill and are unable to work anymore, your debt is deleted. This is run by our government.
The public education is terrible in America. That's Problem One. A large chunk of college is to teach students what they should have learned in high school at the latest. At graduation of high school, a person has no more useful skills for the job market than a person who dropped out, other than a diploma which is worth less than the paper its written on, except to remove artificial barriers.
Why aren’t people borrowing from their local money shark? seems much more prudent than this.
I just don't get this American debt dream 🤷🏻♀️ In my country, healthcare is free. One can have major surgery or give birth to 10 children, all for free. Education is also free and these crazy interests are not allowed by law. For example, student loan interest in my country is 5% in YEAR, thats it.
I experienced the same issues with student loans owing over 100k & working for the public/county. My loans are on hold due to Covid-19 & l am I hoping for relief real soon.
I dont get it. I am from germany. I had students loa n for a private university as well. It was more abour a credit of 8k. Hat to pay back about 12k in 4years. These four years with just a small sallary were tough, but managable. Since than I have nothing to pay back and can live my life. Why are there those unfair conditions in the US with student loans. Everybody loses if you cant pay the back...
I paid off my $32k student loans. Took about a decade. I refinanced and consolidated shortly after graduation. I started pre-veterinarian but switched to nursing after doing the math on what I would owe. I started working after my bachelor's rather than rolling debt into a master's degree. A lot of these posts are from people with 6+ years of education and accumulation of debt. Did those folks not take a math class?
Not a college but went to cosmetology school. Had two loans I signed for and had to pay back on 6 months after getting my state boards passed (97%!). Was paying and paying and paying when I realized the school forged my name and took two additional loan out (one of each) and pocketed that money. So I had to pay double on two loans. $26kX2. Took me 15 years but did it. Found out when I thought I had them paid off but got a collections letter for the doubles. I even showed payments but school had closed and no records. Made no sense but I owed it. Get your own loans for things at rates you can deal with. I've learned that.
The problem here is the stupidity of the students. Not all jobs that can pay well require graduate degrees, and the students should know to leave degrees that have little value in the marketplace to the ones privileged enough to not worry about wasting their time and money. Your gender studies degree will get you nowhere except being in dept and a burden to the economy.
Exactly. Stop complaining about the loans you signed to get your doctorate in gender studies.
Load More Replies... Anyone that thinks our politicians are going to do anything about this are deluded. Banks own them, and the banks only care about making their money. If, by any slim chance our politicians decide to do something, it will be minor and only benefit a small portion of student borrowers. There will be so many requirements and qualifiers that only a small fraction of student borrowers will be helped. Just like everything else our politicians do; they do the least amount that will get people off their backs and get them re-elected.
The sad thing is many of us spent so much money on a degree and then can’t find a job with the degree. All the offices or companies you want to work at want you to basically be an expert to get an entry level job.
The choice of major has a lot to do with it. There have always been useless degrees but they've become the majority now. Study something practical and you'll get a job.
Load More Replies... Ok, you american boys and girls, listen up! Apply for universities in Canada, UK, Australia or literally any other country in the world. Education might be lower quality, but at least free'sh of debt AND you get to travel! Punish business with your wallets
America doesn't want things to change… correction… PRIVILEDGED american and REDNECKS american doesn't want things to change. we saw it these day with 'Murican who beat BLM people on the street and doesn't want to wear mask. this country couldn't be any low in the shithole
I come from a long proud line of rednecks, and we a definitely not the problem. The main problem is the proportion of truly 'average' people who have been brainwashed into thinking that rich people's problems are their problems too, and they need to vote to support what rich people want, rather than for representatives who support programs which will actually do good in the world.
Load More Replies... Stop crying it's you who signed the loan.You knew what the loan Intailed. If you didn't your own dumb fault for not reading your plan. So sick of people crying ITS YOUR OWN FAULT.
Socialism! At least in the capitalist Nordic welfare system, market rates are good enough! (BTW, is the EURIBOR still negative?)
Load More Replies... Between health insurance and student loan payments, how do American afford to live? Socialism isn't a scary as you think it is.
Socialism will scare away investors. For the USA, this is terrifying.
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