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More Student Loan Debt Than Credit Card Debt

Americans now owe more for their student loans than their credit card debt. It is starting to cost more to go to college, but credit card balances are being paid off. Some analysts say less consumer protection for student loans than other types of borrowing is a reason for the trend. It isn’t really worth getting student loans anymore with college costs being so high. Meanwhile, research shows that many of the top growing job fields don’t require a bachelor’s degree.

Students get more loans with college costs increasing

The 2010 Federal Reserve figures show that $ 826.5 billion in revolving credit is had by Americans right now. Americans have $ 829,785 billion in student loans as outlined by a Wall Street Journal article showing a report from FinAid.org. Mark Kantrowitz, publisher of FinAid.org and FastWeb.com, told the Journal that he estimates $ 300 billion in federal student loan debt has been incurred in just the last four years. Parents are just borrowing because college costs more but unemployment has gone up.

Student loans don’t have consumer protection

Student loan debt could be more dangerous than credit card debt. Student loans nevertheless stay with a person, even through a bankruptcy. Missing payments with student loan repayment can mean some terrible penalties. Credit cards have consumer protection that comes with then such as truth in lending, usury laws, fair debt collection and statutes of limitations, but student loans don’t have any of that protection, reports Student Loan Justice. The group calls student loan lending “an inherently predatory lending system that succeeds when the students fail.”

College costs drain family finances

Student loan debt is rising along with college costs. Bank Investment Consultant reports that average total college costs for 2009-2010 were $ 35,636 at private universities and $ 15,213 for in-state students at state colleges. These costs are increasing by about 5 percent a year. Many top institutions have announced that total charges will top $ 50,000 within the current academic year. Paying for school is difficult enough for families before having to pay with income and savings for schooling.

Bachelor’s degrees worth dying

Getting a degree is worthless with the student loans that have to be taken out to get it right now. The New York Times reports that no more than half of students who began a four-year bachelor’s degree program within the fall of 2006 will get that degree after paying tuition for six years. The Bureau of Labor Statistics reports that within the next ten years, seven of the thirty jobs expected to grow the fasted require a bachelor degree. Among the top 10 growing job categories, two require college degrees. Richard K. Vedder, founder of the Center for College Affordability and Productivity, told the Times that 15 percent of mail carriers have bachelor’s degrees, according to a 1999 federal study. He explained:

“Some of them could have bought a house for what they spent on their education.”

More on this topic

Wall Street Journal

blogs.wsj.com/economics/2010/08/09/student-loan-debt-surpasses-credit-cards/

Bank Investment Consultant

bankinvestmentconsultant.com/bic_issues/2010_8/college-cost-gone-wild-2668047-1.html?zkPrintable=1 and amp;nopagination=1

New York Times

nytimes.com/2010/05/16/weekinreview/16steinberg.html

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