Student loans have become a necessary evil in today's society. On one hand, we're told that finding a job in the current economy is difficult for everyone, on the other, going to college increases one's opportunity for both employment and salaries. However, because of the rising cost of higher education, the only way many students (myself included) are able to afford attending college, even state schools like SU, involves taking out a student loan or two.
The good news is Uncle Sam is more than happy to lend his nieces and nephews the money they need to continue their education; the bad news is, despite what parents, teachers, and guidance councilors tell you in high school, the chances of being able to pay back Uncle Sam (with interest) aren't great.
According to this article from The Pelican Post and The Economist, "college tuition has risen twice the rate of inflation and four times the rate of wage growth." In the United States, student loans increased 30% between 2004 and 2005. This alone would not be so frightening if 45% of college grads only earn less than $15,000 a year despite owing, on average, $20,000 in loans. If these statistics are giving you the chills, here are the percentages from The Pelican Post of students who are forced to default on their loans:
- 25% of all government loans default
- 30% of community college loans default
- 40% of two year college loans default
- 43% of loans from for-profit [private] schools default
So, what are we to do, Gulls? A high school diploma does not open many doors and has become the minimum requirement to pursue most respectable careers; however, even graduating from college does not assure many students to actually make money. Instead, it becomes a contract in which students agree to become indentured servants to the government. We are paying for the hope that we can realize the American Dream, pay off our loans with our amazing new jobs, and have plenty of extra left over cash to start a family and buy a house in the suburbs.
The government readily lends money to students to invest in their education; recognizing more funds are available, schools begin to raise tuition. They know that if they raise their cost by, for example, $200 per student for a semester, students can easily continue attending the school...they just need to take out a bigger loan. However, when tuition rises at a rate faster than inflation, paying back these loans in any sort of timely manner becomes virtually impossible. But, don't worry...the school already received their money, and the government knows you'll be good for it...eventually. In the meantime, don't mind the interest; you'll have plenty of time to worry about that later while you're holding your cardboard sign outside of Walmart.