The American dream for many is to drive a nice car, own a nice home and have a great job. Unfortunately that dream is dead for many under 40. Young people are leaving college with student loan burdens that would choke a horse – $1.4 TRILLION and counting; surpassing credit cards to become the largest source of personal debt outside mortgages. Interest rates for financing a home are increasing, plus loan terms are more restrictive than in the past. According to an article in the New York Times the ability for those in their 20s and 30s to buy a home is dramatically reduced due to the burden of paying their student loans.
Many Parents Cannot Pay for Children’s College
Parents face their own financial burdens and cannot help pay for all or part of their children’s student loans. Leaving their children with few options: don’t go to college, but work at a minimum wage job for the rest of their lives; work part-time while going to school (which can double the time to complete school) or borrow loans to finance school.
Are Costs for Higher Education Going Up Just to Colleges Can Make More Money?
The cost of higher education has erupted in the last few years. The more financial funding that is made available the more the cost of education rises. Which leads me to wonder about the greed of our higher education systems. Are they in the business to educate our children or make money?
Article from Crain’s Cleveland Business July 25, 2019
Among borrowers who started making payments, as many as 59% might be making no payment at any given time, the institute said in a report released Wednesday, July 24, in Washington, D.C. The payment status changes reflect income swings, and show families are less consistent paying student loans than those for cars and homes.
Student loans double in 10 years
Student-loan balances outstanding have more than doubled in the past decade to about $1.5 trillion held by almost a fifth of the population, Federal Reserve Bank of New York data show. The new study of those obligations is based on checking-account customer data from more than 4 million families who paid student loans between 2012 and 2018, according to the institute, part of JPMorgan Chase & Co.