Student Debt Continues Haunting Millions of People
Graduating from college doesn’t guarantee financial stability anymore. You can be a straight-A student and take the best internships available, but with the current economic situation the first job you land may not be enough to cover living expenses and student loans.
Student loan debt skyrocketed in the last decade, reaching $1 trillion. Loan companies have tricked us into thinking that student loans can be easily paid off, but this is not the reality millions of recent grads are facing. It’s just simple math; recent grads can’t pay off their loans when their salary barely allows them to cover living expenses.
Student loans haunt people for decades, some individuals even die without paying off their loans. Also, an increasing number of people have their loans charged off as a result of not being able to pay them. This can lead to negative information on people’s credit reports.
The Equifax’s latest National Consumer Credit Trends Report shows that charged-off balances and the bulk of student loan write-offs for the first two months of the year reached $3 billion, an increase of 36 percent from last year. The report also showed that outstanding balances on student loans increased more than 14 percent this year, from $746.3 to $852.7 billion.
If you are a parent or a student, make sure you weigh different options before getting a student loan. Here are a few things to consider:
Community college: One option that decreases education costs is attending a community college for two years, and later transferring those credits to a university. When students live at home while attending college, they can cut tuition, rent, food, and transportation costs. Also, some community colleges offer two-year programs designed for adults that cost much less than a four-year degree at a university.
Look for scholarships: Before obtaining a loan, students should apply for every scholarship available to them. First, it’s important to make a list of scholarships that support certain careers. For example, engineering students should target companies that support technology. Then, students should make a second list of the rest of the institutions that offer standard scholarships and apply for all the scholarships from both lists.
College is not for everybody: Even though society tells us that college is a requirement to succeed, this is not always true. Not everyone needs to go to college to build a successful career. There are technical schools that provide special training for mechanics, machinists, medical therapists, etc. There are hundreds of occupations that offer competitive salaries and career advancement opportunities.