This is the time of year when hundreds of thousands of eager young Americans are looking forward to their first year in college. The last thing most of them are usually thinking about is how they are going to pay off all of the student loans that they are signing up for. But they should think about it. After all, do you buy a house or a car without first considering how you are going to pay for it?
But somehow it has become "politically incorrect" to suggest to college students that they should consider how in the world they plan to pay for the education they are about to receive.
Most young college students assume that they will just run out and get a great job once they graduate and that paying off these loans will be no problem.
But for millions of young Americans, that has turned out to be a very faulty assumption. In fact, in the current economy millions of recent college graduates are unemployed and "good" jobs are few and very far in between.
And it gets really hard to pay off tens of thousands in student loan debt without a good job.
The New York Times recently profiled Cortney Munna - a recent college graduate who has not been able to get that "good job" and who now finds herself in student loan hell. She told the New York Times that she would gladly give back her education to get out of all this debt....
"I don’t want to spend the rest of my life slaving away to pay for an education I got for four years and would happily give back."
The truth is that is exactly where hundreds of thousands of young Americans find themselves.
So if you are getting ready to take out huge student loans, you might want to think twice before signing the dotted line.
So just how bad is it out there?
Well, with tuition at some universities now running more than $30,000 a year (before you even add fees and expenses), students are racking up debt at an alarming rate.
The Project on Student Debt estimates that 206,000 students graduated from college with more than $40,000 in student loan debt during 2008. Using 2008 dollars, that represents a ninefold increase over the number of students graduating with that amount of debt in 1996.
So the truth is that we have a real student loan debt crisis on our hands.
Young people are getting into massive amounts of debt and they are not getting good jobs that allow them to be able to service all of this debt.
And bankruptcy is not an option for these young people either.
The Truth About Student Loan Debt
But somehow it has become "politically incorrect" to suggest to college students that they should consider how in the world they plan to pay for the education they are about to receive.
Most young college students assume that they will just run out and get a great job once they graduate and that paying off these loans will be no problem.
But for millions of young Americans, that has turned out to be a very faulty assumption. In fact, in the current economy millions of recent college graduates are unemployed and "good" jobs are few and very far in between.
And it gets really hard to pay off tens of thousands in student loan debt without a good job.
The New York Times recently profiled Cortney Munna - a recent college graduate who has not been able to get that "good job" and who now finds herself in student loan hell. She told the New York Times that she would gladly give back her education to get out of all this debt....
"I don’t want to spend the rest of my life slaving away to pay for an education I got for four years and would happily give back."
The truth is that is exactly where hundreds of thousands of young Americans find themselves.
So if you are getting ready to take out huge student loans, you might want to think twice before signing the dotted line.
So just how bad is it out there?
Well, with tuition at some universities now running more than $30,000 a year (before you even add fees and expenses), students are racking up debt at an alarming rate.
The Project on Student Debt estimates that 206,000 students graduated from college with more than $40,000 in student loan debt during 2008. Using 2008 dollars, that represents a ninefold increase over the number of students graduating with that amount of debt in 1996.
So the truth is that we have a real student loan debt crisis on our hands.
Young people are getting into massive amounts of debt and they are not getting good jobs that allow them to be able to service all of this debt.
And bankruptcy is not an option for these young people either.
In fact, federal bankruptcy law makes it nearly impossible to discharge student loan debts.
So once you are in student loan hell you are basically stuck there for the rest of your life.
So, young person, think really, really hard before you sign that dotted line.
Because once you take that student loan, it is going to follow you for the rest of your life.