Roll of the Dice of Higher Education
Ok, now that the arduous task of finishing that four year degree has become a reality and while walking across the stage to receive your degree, your family is smiling and taking pictures of your proud triumph, but then your smile turns to stress and anxiety when you’re handed a bill of $40,000 along with your degree. This is the scenario many students face after graduating from college/university. Even though this may not happen exactly like this, the student debt is certainly real though. Many students are faced with little choice, other than to finance your future and go further into debt to strive for greater. The average student loan debt was more than $27,000 in 2012 which has more than doubled since 2007. In this time defaults on loans has also doubled over this same time frame (Ross, 2013). Illustrations like this happen more often than not and have to end eventually. The government has the ability to put a cap on the high cost of education, but since higher education is big businesses that will more than likely never happen. Student should not have to mortgage their impending future to have a better future. This has become a harsh reality, in 2011 the student loan debt has surpassed the consumer debt and had reached $ 1 trillion threshold a year. Student loans are the most lucrative sectors of the financial industry (Ross, 2013). Nevertheless more people have enrolled into college/university to achieve their higher education, due to the poor economy. Despite the soaring enrollment rates, the completion rates have still remained stagnant (Smith, 2014). Now many people may say big deal, I am not attending school or even considering going back to school so this does not affect me. This is probably the philosophy of most, but one thing you have to remember is that the middle class drives the economy, so if they are burden down with student loan debt the economy will suffer, because the spending will eventually stop or come to a crawl. The burden of student loan debt has a greater toll on the economy than one might think. This form of debt, hit the economy harder than the housing crisis did. Because of the debt student take on it can delay the purchases of a new home or car due to the repayment of their student loan. Home ownership is 36% less among student currently repaying student loans, which also hurts the economy. Some say increasing your debt is a bad idea, but some analyst say that is a good idea, because it shows that the economy is growing and more people are spending money, which in turn will boost the economy. Unfortunately this does not apply to student loan debt; student loan delinquency rate is higher than credit cards, mortgages, and auto loans (Touryalai, 2014). The main cause of this problem is mainly due to the soaring cost of higher education in the United States. Another problem is the 25 year low on the participation of help from state and local government (Smith, 2014). The levels of help from these governments have dropped to 10 % or less for many of the higher education intuitions. The majority of the student loan debt is racked up on the middle class and magnified among the low income families. Out of all the racialized groups African Americans graduated with the highest average debt. This is partially credited to some Deep South schools not participating in the federal loan programs so the consumer take on the full burden of debt.
While help from state and local government has dropped off, the rising cost of education has continued to rise. Nevertheless more people have enrolled into college/university to achieve their higher education, due to the poor economy.
Despite the soaring enrollment rates, the completion rates have still remained stagnant (Smith, 2014). 54 percent of students who graduated with a bachelor degree from private/for Profit University,