Author: summergirl1999

Student Debt: Success or Scam

In American society, having a college degree holds weight. Working towards a college degree shows employers that graduates are motivated to succeed. A college degree can determine many things such as, raises, well-paying careers, and most importantly success. Attending college is highly encouraged by teachers, parents, friends and other mentors that students come across on a daily basis. ‘Successful’ is a word that everyone wants to describe themselves as, and American society says that a college education is one of the steps that can help graduates move in the right direction towards success. Every person is distinct, which means personal and finical issues vary. Depending on the person, college can either be worth the time and money or not. College can benefit or draw back students, depending on the specific student. (Student A and Student C. Every student has the choice to attend college. Getting asked the question “Are you going to college?” can be challenging to face for some students. College is a consequential decision that comes with many components. College can either benefit or draw back graduates, depending on the specific student. (Student A and Student C.) A career and well-paying stable jobs in the student’s field of study is not guaranteed a college degree.

Student A, is an example of the positive benefits from attending college. Student C, is an example of the negative effects that can occur from attending college. College tuition alone is expensive, if the student wants the full ‘college experience’ which requires living on campus the tuition rises in price. Public university tuition is averaged at $25,290, and private university tuition is averaged at $50,900. Student A, went to a prestigious high school and received a great education, which resulted in scholarships. Student A, has a finically stable background and money saved, so the remainder of the tuition is not a struggle. Student C, went to an average public high school and received a decent education which resulted in no scholarships. Student C, does not have a stable finical background and a limited amount of money saved, so the price of tuition is a challenge. Student C, has to take out student loans to pay for their entire college education. Students choose to go to college so they have greater opportunity to pursue their career. Student A, chose the career that they have been fascinated with, they enjoy the career and its salary. Student C, also wants to choose the career that they have been fascinated with, but studying that specific career raises the tuition, so Student C selected another career that they do not enjoy as much but offers a suitable salary. In an article called College Data they did a study on the fluctuation of tuition depending on majors:

Students in the sciences, engineering, computing, premed programs, and the fine arts often pay more. For example, at University of Illinois Urbana-Champaign, students enrolled in the College of Engineering pay up to $5,000 more in tuition than students pursuing other majors.

Depending on the major the student decides to study can determine the price of tuition. Students who choose majors related to the sciences and engineering most often pay more considering the complexity of the degree.

The question “Is college worth it?” is becoming a relevant topic in today’s society. Many people believe that having a college degree is one hundred percent worth everything that is put into it. But many people also believe that the money and time that is put into a college degree is not worth it. There are many factors that go into college itself, and there are many debates on college. Students will make more money and higher salaries from attending college. Students attend college so they can make themselves more marketable to the career field, and to also make a good and stable amount of income. A member from the CBD College community states

Studies have shown that there is an average of $25,000 earnings difference between grads and non-grads… The bottom line is that pursuing a degree increases the ability to find work in the same field, increasing experience and earning potential.

Having a college degree can give a graduate the opportunity to receive higher paying salaries and stable incomes. A college degree can also give a student the potential to receive higher raises. Not every student who receives a degree gets a stable income. Student A attended college, received a degree, and found a career that had a stable salary. Student C attended college, received a degree, and found a job that offered salaries that do not pay enough to pay off student’s expenses. The push to try to make students attend college is leaving many students optioning out the “build your own business” or entrepreneurship idea, which is the idea many of the billionaires in today’s society had. An article from Seed Time, a website that focuses on education states,

25 of the top-paying jobs that don’t require a four-year degree and their average salaries… It is important to note that some of these jobs DO require some kind of a degree, just not a 4-year degree. As many have commented below many of the jobs do require formal training of some kind or even a two-year degree.

Many business companies seek employers that have college degree or training in the specific field.

College graduates can potentially have better employment opportunities. Students go to college so they have a high chance of getting a career in their field of study. Many college graduates (Student A), take-out loans or pay the expensive college tuition because the money they can potentially make from their careers after college is worth it. Pro Con is a website that focuses their attention on students that are indecisive about their college decision. They stated, “In Jan. 2017, the unemployment rate for college graduates aged 25 and over with a bachelor’s degree was 2.5% compared to 3.8% for those with some college or associate’s degrees, 5.3% for high school graduates, and 7.7% for high school dropouts.”

After college, graduates use their degree to get a career in their field of study that they potentially could not get if they did not go to college. Although many people get to use their degree for their benefit by obtaining their “perfect” or/and “dream” career after college (Student A), not all students get to use their degree for their benefit. Even with a college degree, after college not all graduates are able to get a career (Student C.) Many employers compare applicants to find the best fit for the job position. The work place is very competitive, potentially thousands of people can be applying for the same position. Cyrus Williams a counselor and professor at the University Virginia and featured on the news station CNBC to speak about college states,

This is a real issue unique to this generation called ‘a quarter-life crisis, struggling in terms of milestones, getting jobs, parenting, finding jobs, having too many choices, and having debt coming right out of college.

College tuition is very expensive, most college students take out student loans which they are obligated to pay back approximately six months after graduation, so not being able to get a stable, well-paying job after college can lead to major set-backs for college graduates. Graduates who do not get jobs after college are required to pay for necessities such as rent, utilities, and food. Even if graduates are not using their degree they are still obligated to pay back their student loans as soon as six months after graduation.

Student loans are not as bad as they seem. Since college tuition is outrageously expensive, most students do not have the money to pay for it. But there is a solution to that problem, to take out student loans. Students who do not have the money for college, take out loans from banks so they can attend college. Banks loan student’s money in return for the students to pay them bank monthly after the student graduates. An article from Student Loan Hero states “Monthly student loan payment (for borrower aged 20 to 30 years): $351. Median monthly student loan payment (for borrower aged 20 to 30 years): $203.” The goal after college is to acquire a stable career that comes with a stable salary, so the monthly student loans will become manageable for the graduate (Student A). That scenario makes attending college worth it and beneficial. On the other hand (Student C), students take out student loans from a bank for a four-year university. After college, many students cannot find a job in their field of study but they still have to pay for necessities so they are forced to get minimum wage job which pays approximately $7.25. Students attend college so they can get a career where they can earn raises and move up in the company, not a regular job. People have their own personal and finical problems, so without a steady paying career can lead graduates to make certain decisions they potentially would not make if they had stable income.

Taking out student loans are a vast factor of attending college. Students take out student loans if they do not have the money to pay for their entire college education. The process is usually simple, students calculate the full cost of their tuition, students find loaners who lend them the money to attend the college of their choice, in return after the student has graduated they are required to pay back the loans monthly with interest. Interest rates vary by the loaner, undergraduate interest rates vary are estimated at 4.45% and graduate interest rates vary around 6.00%. Students tend to find lenders with the lowest interest rates because interest rates can be a burden. An article from CNBC about millennials facing their lives after college states,

The longer you hold the loan, the more it will cost. Although the five-year plan comes with much higher monthly payments, following the 25-year plan will cost you $17,402 extra in the end. In all cases, the interest on your student loans means you’ll be paying more than what you borrowed to go to school. Even on the shortest payment plan, you’d be forking over $3,704 more than you originally received.

Student A, has scholarships and money saved so they only borrow a small amount of money in loans. Student C is not finically stable, they have to borrow almost their full college tuition in student loans to pay off their education.

Student debt is a huge matter in America, it is one of the top leading and most popular debts that America encounters. An article from Money Watch states, “For the 2013-14 school year, the government sank $126 billion into undergraduate student aid.” Education is important, many students and graduates are finding it challenging to call the college tuition prices reasonable. An article from Student Debt: Lives on Hold is focused on the recent studies of college they state, “Fewer know that growing alongside 42 million indebted students is a formidable private industry that has been enriched by those very loans.” Steele is sarcastically stating the large population of Americans that have student loans. Depending on the university attended and the money granted, the amount of student debt per-person fluctuates. Leaving some graduates in more challenging situations than others. Jackie Krowen is a nurse from Portland, Oregon who encountered a student loan balance of $152,000. “I feel I kind of ruined my life by going to college, a nurse with a student loan balance of $152,000. I can’t plan for an actual future.” Krowen encountered such a massive amount of debt, her student loan debt is causing her to be hesitant about her future.

The enormous amount of student debt is delaying American society, and affecting personal lives. An article from Forbes magazine about student debt affecting today’s society states,

More student loan debt means some kids are starting households later and moving from renting to ownership later than their parents did, which ripples throughout the economy—so when you don’t form a household, you delay when would purchase a car, furniture, appliances and utilities.

Many graduates are postponing or limiting purchases on common expenses and utilities, because they need to save enough to have the monthly payment. Students attend college to struggle less and be finically free. A report from “Life Delayed” by the American Student Assistance, did research and conducted surveys on graduates that encountered student debt. “According to the survey, 62 percent of respondents said their student debt posed a hardship on their personal budget when combined with all other household spending.” Having a college diploma should come with great honor and relief, for all of the hard work and time. College loans were originally put into place so more people would have the opportunity to farther their education. But now low and middle-income students are reconsidering college due to the loans. Along with college, loans were put into place to help students no matter their financial background have the opportunity to attend college.

When college graduates apply for careers, most careers look at what college the graduate attended, college recognition. Student A graduated from Harvard University as a chemistry and physics major. Harvard University is one of the most prestigious colleges in America, and has recognition. Harvard Universities tuition is $63,025. Student C graduated from South Texas College also as a chemistry and physics major. The tuition at South Texas College is $11,892. Although South Texas College has good reviews and is a college it does not have the same recognition as Harvard University. If Student A and Student C both applied for a job for chemistry and physics, Student A would most likely get the job. The Atlantic magazine wrote an article about types of schools and wages. They stated,

The rankings, it turned out, mattered a great deal. The more elite a school, the better its alums’ paychecks. The effect also increased over time. Among students who had graduated high school in 1980, those who had gone on to a top private university eventually made 20 percent more than their counterparts from bottom tier public school. For the class of 1972, the wage boost was just 9 percent.

Graduates that come out of college with a degree are still not guaranteed a job in the field that they studied nor guaranteed a high paying career right away. Although students attend college so they can have a higher chance – or even a chance at all at pursuing a career, the career is not always guaranteed. After college, it is almost essential for graduates that go out in the real world to have a steady career to pay for all of their expenses, beyond what they owe on their student loans. A reading from The Boston Globe gives insight about the education system, “If we tell our young people that more education leads to higher earnings, we are not telling the whole truth. Higher education will increase the chances of a well-paying job, but there is no guarantee.” Loan companies usually give graduates a six-month courtesy period to get themselves organized and ready to pay back their student loans. It is not the universities nor the degrees fault for not being able to seek a job, there are just more college graduates than there are careers. Another quote from The Boston Globe states, “The number of jobs paying what college graduates expect depends on the needs of employers. That number will not increase because there are more graduates.” Loan companies do not have high concern about the personal or financial situations that graduates may be in after they finish college, loan companies main concern is getting their money returned to them. A website titled “Money Crashers” was featured on CNN, Forbes, and the Wall Street Journal. The website gives useful tips and helpful advice for graduates that cannot find a steady career. “Stay positive, reduce your cost of living, move back home, and put yourself on a budget.” One of the main reasons students attend college is for the reassurance that they will be finically stable. Job popularity can have an effect on graduates not being able to find careers. A reading from The Washington Post speaks about many students going to college and earning a degree but cannot find a job. They state, “At a median wage of $83,580 a year, the occupation with the fastest projected job growth, industrial-organizational psychologists, pays well. But, there’s not much demand for this type of psychologist.” Graduates may have degrees in professions that are not so popular anymore which also means less jobs.

Student A went to a prestigious college, got a career in their trained field, paid off their little amount in student debt and just bought a house. Student C went to an average college and could not find a job right after gradation so they had to get a job at a Target so they can pay off their necessities (rent, food, utilities, and personal purchases.)  Six months after Student C graduated college, they needed to start paying off their student loans, which can be a huge inconvenience and challenge because Student C is making an average of $9.33 an hour.

It is hard enough for graduates to deal with the amount of debt they are in themselves, but people have personal problems that can make it more challenging. The Denver Post states,

Millions of college graduates who saw a degree as their ticket to a good-paying career and a secure life are working in jobs that do not require their education or even a high school diploma, sometimes leaving them with small wages to pay thousands in student debt, according to a new study.

For Student A, college was worth it because, they had enough financial stability to choose a prestigious college that cost $63,025. Also, because Student A got a career in their field with a steady salary right after college which helped pay off their student loans. For Student C, college was not worth it because although they have a college degree they could not find a stable job. Since Student C took out student loans they are still obligated to pay back their student loans.

Education is what makes the world go around. It holds so much complexity and value and can structure a person’s life. The choice to attend college is a decision that most students have to face. College Attending college is a choice that is given to everyone. Attending college and having a college degree has its benefits and values. The choice to not go to college also has its benefits and values, it gives a person the opportunity to think outside the box. Both decisions take believing, motivation, and effort. The rise of college tuition and student debt is affecting the personal and finical lives of college graduates and the United States economy. Student debt is impacting many lives of college graduates.

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