Part 1: People are stupid:
Student Loans Weighing Down a Generation With Heavy Debt - NYTimes.com
The article starts with a story that completely fails to move me about an eighteen year-old convinced by faculty and admissions staff members at Ohio Northern University to pursue her dream rather than obsess on the sticker price. She works two jobs (earning $225 a week combined--equal to her student loan payment), is moving back in with her parents, and owes $120,000, with a $900 monthly payment. Her father is a paramedic and her mother is a preschool teacher. She has four sisters [who will probably be attending community college]. Her parents got loans to help and they took out a life insurance policy on her (but some lenders forgive loans upon death).
They say she is in the top 3% of students with debts.
So, there are doctors that owe less?
“Roughly 11 percent of college students now attend for-profit colleges, and they receive about a quarter of federal student loans and grants.”
“Students at for-profit colleges are twice as likely as other students to default on their student loans. Moreover, among students seeking a bachelor’s degree, only 22 percent succeed within six years, compared with 65 percent at nonprofit private schools and 55 percent at public institutions.”
“Nationally, state and local spending per college student, adjusted for inflation, reached a 25-year low this year, [...] while, the cost of tuition and fees has continued to increase faster than the rate of inflation, faster even than medical spending.”
“[M]ost college students in the United States manage to eventually pay back their student loans.”
Student loan debt exceeds credit card debt.
Christina Hagan is a 23 year-old Ohio lawmaker earning $60,000, but owes $65,000 in student loans. When she graduates, she will wait tables to help make her $1,000 monthly student loan payment.
“In the late 1970s, higher education in Ohio accounted for 17 percent of the state’s expenditures. Now it is 11 percent. By contrast, prisons were 4 percent of the state’s budget in the late 1970s; now they account for 8 percent.“
How do they account for prisoners pursuing degrees?
In 2011 the Obama administration required colleges and universities to post calculators on their Web sites that explain the net price after grants and loans, but critics say they can be confusing, misleading or hard to find.
The article ended with the story of a forty-four year-old that dropped out after one semester at the community college. She decided to attend nursing school at a for-profit school which advertised no wait list. It will cost three times as much, but she will worry about it later.
There are six more articles. This one was six pages. I will summarize the rest after I study some more for the GRE. Have a great day!
