The Aging Student Debtors of America

This is not the first time I have heard about the student loan debt crisis. But hearing about these numbers was still startling. There are over a trillion dollars in outstanding student loans.Can you imagine how much money we could save if we were able to return half of our national debt back to the people that created it? We would have over $500 billion left over. That’s enough to pay off 100% of all student loans currently in place.

What do you think? Does this sound like something that should be addressed? Or is the government out of control? Is this a problem that only affects us in the U.S.? Let me know what your thoughts are down below.

The Aging Student Debtors of America

This video shows how student debt has become a burden and an obstacle to financial stability for millions of Americans. By analyzing data on student loan borrowers who have filed for bankruptcy since 2009, we were able to show just how crippling their debt really is. Most student loan borrowers cannot afford medical emergencies, unexpected car repairs, home repairs, or even necessities like groceries.When student loans go unpaid for a long period of time, they often lead to garnished wages and tax liens, both of which make finding employment difficult and can force people into further debt. Our findings explain the deep-rooted causes of the problem and highlight some of its many side effects.

A study published in the Journal of Consumer Research finds that college graduates who have taken on student debt may be less likely to buy homes than their peers without loans.

Preamble-Jai Wolf via

Licensed under Creative Commons: Attribution 3.0.

The Aging Student Debtors of America

A study published in the Journal of Consumer Research finds that college graduates who have taken on student debt may be less likely to buy homes than their peers without loans.

Another study by the Federal Reserve Bank of New York found that student loan borrowers were nearly three times more likely to default on their mortgage payments compared with homeowners with no student debt.

According to a survey conducted by the Center for American Progress, 40 percent of student debt holders are either behind on their house payments or already delinquent—up from 29 percent in 2010.

The average monthly repayment on a federal student loan program was $837 in 2012.

The Pew Charitable Trust’s research suggests that about 2 million people are currently underwater on their mortgages due to student loan debt.

Student loan borrowers are still struggling even after having paid off their loans. In fact, the share of student loan borrowers who say they’re financially insecure is roughly the same as what it was in 2007, according to data from the Federal Reserve Bank of St. Louis.

A recent report by the National Bureau of Economic Research estimates that the government spends around $70 billion annually repaying the debts of U.S. citizens who took out student loans between 2008 and 2011.

After graduating from college, students who borrowed money need to start making payments immediately. If you don’t make any kind of payment for six months, then you’ll lose the right to pay back the money yourself.

Student lenders often require that borrowers take out two types of loans at once: private and federally backed ones. Private loans are generally cheaper since they aren’t guaranteed by the U.S. government, but they carry higher interest rates because they don’t qualify for favorable financial aid programs.

Students often get into trouble paying back their student loans if they move away from home or if they switch jobs that don’t earn enough to cover their living expenses.

When people file for bankruptcy, their student debt is considered an asset, meaning it is deducted from their total assets before calculating how much they should repay their creditors. However, there are certain exceptions, including medical bills and student loans.

Many people think that student loans are automatically discharged when you enter into public service, such as teaching or nursing. But not everyone is eligible. Instead, you can only discharge them if you prove that you’ve lost income or cannot find work in a particular field.

Student loan forgiveness is becoming increasingly popular among young Americans. In 2006, only 6,000 people received full relief. That number had grown to over 100,000 by 2016.

Around 1 in 5 current students taking out loans says they would choose to take out private rather than federal loans if they could do so again.

The Aging Student Debtors of America

The student debt crisis is just beginning

According to the Government Accountability Office (GAO), in 2012, the total outstanding federal student loan debt stood at $937 billion.This is roughly 40% higher than what was reported a decade ago.And college costs continue to rise faster than inflation. According to College Board data, the average annual cost of tuition and fees has risen nearly 20% since 2010.Meanwhile, wages have remained stagnant over the same period.

Higher education remains out of reach.

It’s no secret that the financial burden of financing a college education has become increasingly burdensome for many Americans. According to the Federal Reserve Bank of New York, the median debt load for those who graduated from college in 2014 exceeded $35,000. The number of borrowers taking out loans to finance their education has risen steadily over the past several years—a trend that’s expected to continue.

Young adults feel the pain.

According to the Pew Research Center, 41% of millennials aged 18 to 34 have less than $500 in savings.If they get sick or lose their job, these young adults may struggle to cover medical bills and pay rent. As a result, some simply give up on school altogether. However, others take on massive amounts of debt in the hopes of acquiring skills that will help them land high-paying jobs after graduation.

Millennials’ outlook on retirement is bleak.

About half of millennials (ages 22 to 35) don’t even believe that traditional pensions will exist 10 years from now. A recent study conducted by Boston College shows that the majority of younger workers view workplace defined benefit plans as being unsustainable.

Millions of students still owe money on their loans.

Even though student loan interest rates were cut in July, millions of borrowers remain stuck paying above-market interest rates. The average interest rate on subsidized Stafford loans more than doubled between 2011 and 2015, rising from 4.66 percent to 9.21 percent.

Borrowers aren’t always aware of repayment options.

Millions of people who took out federally-backed loans are unaware of their options for repaying their debts. Many do not know how much time they have remaining before they end up defaulting on their payments, nor do they realize that additional financial aid could mean fewer dollars owed upon graduation.

Default rates are rising.

Since 2008, the nation’s student loan default rate has grown dramatically — from 1.06 percent to 6.32 percent as of September 2016. Experts say the rising numbers are due to a combination of factors, including increased household income among borrowers and reduced access to credit.

The Aging Student Debtors of America

Student debt has become a major problem in America today. Many students have taken out loans just to get an education, and they often end up being stuck paying them back over their lifetime without any real increase in income. In this video, I take a look at what causes student loans to go bad and how you can avoid spending your entire adult life paying off debts.

I’ve been writing about student loan debt since 2013, and even then it was really starting to gain some traction. At the time, we were looking at nearly $17,000 in default judgments alone. Since then, I’ve been tracking the data and here’s what I’ve observed.

In 2014, defaults increased dramatically. Almost 10,000 people were not able to pay back their student loans, and many ended up getting sued by the government. Then, in 2015, I noticed a huge drop in defaults, showing us that student loan companies had learned valuable lessons from these early mistakes. I discovered that the debt collection industry is riddled with predatory practices for profit.

But after watching the subprime mortgage crisis unfold again, the student loan companies realized they could make an extra buck by selling my personal information to debt collectors. So I started receiving calls asking me if I was still making payments on my loans or if I had stopped. And I didn’t stop.

The student loan racket isn’t fixing the problems of higher education, no matter how much political pressure they face from the industry. Colleges and universities aren’t doing enough to give students better value for their money. As long as colleges continue to raise tuition prices, expect student loan debt levels to rise.

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