The Akron Beacon Journal front page story Sunday was titled More and More, Students Having Trouble Paying Back Their College Loans.
A few quick takeaways-
- Borrowing over $100,000 to get psychology degrees did not create sufficient ROI to cover $900/month loans payment for one student, whose work using her degrees is paying near minimum wage;
- Nationwide, 14.7 percent of borrowers defaulted on their federal student loans in their first three years of repayment;
- Nationwide, students at for-profit colleges have the most trouble repaying their loans, with almost 22 percent not making payments for at least 270 days in the last three-year snapshot;
- According to a new study by the University of Kansas, adults with student debt tend to show lower college graduation rates, delays in marriage and buying cars and homes, and lower net worth than those without debt.
- According to a spokesperson from the Institute of Student Access and Success: “The loan is supposed to enable them to get an education to get a job and pay back the loan, when you see high default rates, you know something in that string of logic has broken down.”
Critical thinking is recognizing and challenging assumptions.
The assumption is that having a college degree, any college degree, will guarantee the graduate a well paying job able to pay off the student loan indebtedness.
For almost 15 percent of borrowers nationwide, this is NOT the case.
We strongly recommend college education if your plan assures that you will earn a sufficient return on your college investment to allow you to repay the cost of college.
In the current economy, frankly, that is often NOT the case.
We urge you to look at college affordability and loan repayment terms up front- and make a decision- do you want to start your life in significant debt?
There is an alternative.
- While many college graduates are unable to find work that pays enough to allow them to pay back their student loans, getting a job in precision machining will enable you to earn while you learn, and avoid the huge student loan debt trap.
- Many employers will provide tuition assistance.
- The outlook for employment in our industry has remained above 90% (Very Positive) all year. CEOs I speak with are always looking to find talented people.
Many of our industry’s top process engineers, managers, buyers and quality control personnel started in operations and built their education as they built their career.
So you now have a choice- borrow loads of money today and hope that you can pay it back tomorrow. Or earn while you learn and build a career as you build an educational pathway to success without huge loans.
We’re really a fan of education of all kinds. We’re just not a fan of big debt.