<p>"Horror stories about student loan debt have dominated the headlines in recent years. Many feature consumers with hefty loan tabs of more than $100,000, however, those experiences aren’t necessarily representative of the student loan landscape as a whole. But, just because you’re not bleeding to death, doesn’t mean you’re not bleeding. And just because most borrowers have $10,000 or less in debt doesn’t mean they aren’t hurting." ...</p>
<p>I know a young woman who has been out of college for about 4 years. Her loans have grown to about 50k. I am guessing that she was given addl loans after her parents failed to qualify for Plus.</p>
<p>she has never made a payment, and from her attitude, doesnt expect to anytime soon. Her degree is in child development, but works retail for lowish pay.</p>
<p>she showed me the paperwork that she had recently received with some choices as to how to restructure the payments based on her income. She insists that the lowered payments are still way too high. In truth, the payments could be 50 a month and she would say that she cant pay.</p>
<p>she was a full Pell student, and she said that she resents that this loan money wasnt a grant. maybe that is why she isnt paying? I wonder if others feel this way?</p>
<p>Yes, I know a number of such former students. It kills me when I hear them talking about this in the rare times that they do. Yes, $50 a month could be paying the interest and some on those loan, maybe they can even deduct the interest.</p>
<p>$50K is not an unusual figure given that the Direct Loans have an unsubsidized part that starts accumulating interest the instant it is disbursed. So you borrow $27K and you have that $2K unsub you borrowed freshman year starting to accrue interest over all of that time in school, grace period and with they young woman Mom2college kids refers to, 4 years. Yes,With interest rates at close to 5% and even higher in earlier years, you can see how that can grow to $50K even without anything other than the standard Direct Loans.</p>
<p>Throw in those additional direct loans which are all unsubsidized and some Perkins loans, and it can add up quickly. It’s $27K of entitlement plus up to $18K more if parents are denied for PLU which is almost $50K in face amount already. THrow in maximum Perkins which I don’t remember in amounts, but say $5500 in Perkins per year and you have another $22K bringing the total to about $75K easily upon graduation with the unsub parts of the Direct Loans accruing interest all of that time. </p>
<p>What 's crazy is that a lot of these kids eat out all of the time, smoke, drink, spend a lot of money on those thing when they could be paying down these loans, albeit slowly. Some of them flat out don’t want to do it. Sadly, I confess my son would probably be the same way from what I am observing about how he treats a lot of his bills. Thankfully he has no loans. So I’m not being sanctimonious about this. It’s really a very bad thing. The only reason some of my graduates are not in this predicament is because they have parents who paid for their education. In this ugly subject, I’m not sure it was such a great thing, because the attitude is what appalls me, and they have it as well as their deadbeat peers. And, yes, I am aware that not all, not most grads are that way. I am expressing my concern of the sector that are, and that there are more of them than I would have guessed. I am ashamed that my kid has that attitude, quite frankly. </p>
<p>I am likely in the minority, but I don’t think that it’s necessarily a bad thing for a student to take on some debt for their education. They shouldn’t take on more than is reasonable, considering likely earnings from the degree they’re gaining, but I think it’s a positive for a young adult to bear at least some of the financial responsibility for their education. They might do that through earning scholarships, through working while they’re in school, or through taking out loans and paying them in a timely manner following their graduation. </p>
<p>The average debt of a student graduating from my school is about $20K. The average starting salary is $74,000. Is that too much debt?</p>
<p>Most people in these fora think the Direct Loan max is a good number, though some look at first year’s salary as an alternative target.</p>
<p>Most seem to agree that taking on NO more than maximum Perkins loan amounts of under $30k for a college degree to get a degree in a field with significantly higher starting salaries is OK. </p>
<p>I am unaware of Us where the average starting salary is $74+K. What U is that, please? </p>
<p>Many of the ‘tech’ schools average starting salaries of $70+ - Cal Tech, MIT, GA Tech. - for the engineering majors. If you look at just petroleum or chemical, it may be even higher.</p>
<p>@Millancad, you might find the New York Times’ take on the Brookings study interesting. The reporter (David Leonardt) thinks the bigger issue is students who leave with modest debt and no degree, not folks who borrow large amounts and graduate:</p>
<p>
</p>
<p>Assuming some debt, he argues, is still a perfectly reasonable alternative for funding some of life’s necessities:</p>
<p>
</p>
<p><a href=“http://nyti.ms/1llHga8”>The New York Times - Breaking News, US News, World News and Videos;
<p>
</p>
<p>Concur 100%.<br>
But the issue is that someone’s necessities are another person’s extravagances; there are those that truly believe that attending NYU at full price – and loans – is a necessity over attending, say their instate public at a fraction of the cost. (And the federal loan program encourages such thinking.)</p>
<p>^I agree. Instead of expanding the federal loan program, they should subsidize state universities to make it affordable to almost everyone. It may also depolarize our society by making expensive colleges less popular.</p>
<p>^^Yup. And if I were the Sec of Educ, I’d be pushing to fully fund all community college courses that were transferable to 4-year Unis. Essentially, a ‘judo’ would be tuition-free for those that desire to transfer. (OTOH, I’d eliminate all federal loan support of private colleges!)</p>
<p>Make sure to read the follow-up to the original NYT column. Much skepticism surrounding the Brookings findings.</p>
<p>
</p>
<p>Probably Michigan Engineering is around that, but not the whole University of Michigan. </p>
<p>Community college is cheap enough already that people aren’t getting into major debt problem from it. </p>
<p>
</p>
<p>Think about it (critically): if two years are (near) free, then the total debt incurred over four years has to be whole lot less, right? (At least less than attending a four-year for four years.)</p>
<p>
</p>
<p>Yes… But I don’t see where you’re going with this. </p>
<p>Go ahead with a line of questions and assume I’m answering the reasonable answer. I don’t want to go though 5 posts of answering yes/no questions. </p>
<p>
</p>
<p>Link?</p>
<p><a href=“Q. and A. About Student Debt - The New York Times”>Q. and A. About Student Debt - The New York Times;
<p>Many thanks @Youdon’tsay!</p>
<p>And here’s the permalink in for future reference: <a href=“Q. and A. About Student Debt - The New York Times”>The New York Times - Breaking News, US News, World News and Videos;
<p>""“I’d be pushing to fully fund all community college courses that were transferable to 4-year Unis. “””</p>
<p>I agree…and then let juniors and seniors borrow 15k for each at a much lower rate…all subsidized.</p>
<p>
</p>
<p>MIT. The most recent report that I could find from MIT itself reported $73,567 in 2012-13. More than half of the school is in tech majors, and less than 3% of students major in the humanities, arts, or social sciences.</p>