There are hundreds of arguments in favor of continuing your education after high school. Employers prefer college grads. Technical jobs require specific technical knowledge. More education promises a more fulfilling career, a career that blends personal growth with income growth.
There are, unfortunately, thousands of reasons to think twice about continuing your education — about 29,000 reasons. According to CNN, 40 million Americans owe an average of $29,000 on student loans. Even if careers and salaries are not progressing, the problem of student loan debt is: Compared with the current numbers, CNN says, an average of $23,000 each was owed by 29 million borrowers in 2008.
That works out to a 28 percent increase in borrowers and a 21 percent increase in average debt over a six- or seven-year period. It also works out to Americans owing a total of $1.2 trillion. Almost one-fifth of that — $230 billion — is owed by for-profit college students.
The for-profit college industry is in crisis, and the students are feeling the pinch. Corinthian Colleges Inc., ITT Educational Services Inc. and Illinois-based Education Management Corp. are a few high-profile examples. These colleges, according to allegations made by regulators and students, deceived their students about the value of their education, about their prospects for employment after spending thousands of dollars on tuition.
A growing number of students, in fact, are demanding that the federal government forgive their loans. If the government can prove its own case, the students will not have to ask: Their loans will go away. But, if not, the students are left to their own devices. They must prove their cases themselves.
We’ll explain more in our next post.
Source: Bloomberg.com, “Taxpayers Could Lose Billions If Students Walk Away From Loans,” John Lauerman, July 22, 2015