Last year, just 66 percent of high school graduates in America continued on to college. That’s around 20 million students, a 5 million increase since fall 2000. It is almost unanimously agreed on that a college education is the most crucial factor in play to achieve financial success post graduation in comparison to those who do not get a degree in higher education. This in turn makes it easier for us to convince ourselves that taking out student loans to pay for this education is the right move, an investment in our futures and one that will be easy to pay back once we have graduated and gone on to get our dream jobs. For young college grads today, the unemployment rate is 7.2 percent. Between 2004 and 2014, there was a 92 percent increase in the number of student loan borrowers. So you see what is going on here? We have more borrowers, but less jobs. With the average student graduating with over $30,000 in student loan debt, how do we pay it back??? Here are 5 shocking facts about student loans today.
1. Today It Is 1000% More Expensive to Go to College in the United States than It Was Just 30 Years Ago
One thousand percent! You want to live the American Dream? You have to go to college. It’s the only way to get a good job. We hear it every day and borrowing money for college is the norm these days. Many people have been told not to worry about how much it costs because there are plenty of loans available. Especially if you choose to go with a private lender, there is a good probability they will lend you as much money as you think you need. So we borrow and we borrow and we think we will pay it back later. We are now facing a 1.3 trillion dollar national student loan debt problem where over 7 million Americans are in default, meaning they have not made any student loan payments in over 9 months. The dream jobs we were promised turned out to be far and few and the money we borrowed to go to college no longer promises a successful future.
2. Seven Million Have Defaulted
7 million Americans who have not made student loan payments in the last 9 months and are now in default. What exactly does that mean? If you default on your student loans, you will trash your credit. You will not be able to take out future student loans, car loans, buy a house, or potentially get a job as nearly 60 percent of employers run credit checks on applicants before hiring. Your lenders will also make a lot more money as they can add up to 25 percent in penalties onto your principle balance, so don’t look to them for a way out of this situation.
3. Average Student Debt is Increasing While Wages are Decreasing
Since 1999, student debt has increased more than 500 percent. Worse than that is the average salary for an entry level grad has decreased by 10 percent since 2000. Which leaves little hope for on-time student loan repayments. This has led to an increase in defaulted student loans and has caused a huge shift in our society as Millennials delay marriage, buying houses, starting families.
4. 65% of Graduates are Moving Back Home Right Away
Some college graduates are happy to be back at home because it gives them an opportunity to save money. But for the majority of them, a difficult job market, high rent, gas and food costs and a mountain of student loan debt gives them no option but to lean back on mom and dad. These are the young adults who have to bounce around from job to job while their college degree gathers dust. A lack of job opportunities and a crushing amount of student loan debt is not where most of us saw ourselves post graduation.
5. Only 15% of Borrowers Eligible for Student Loan Forgiveness Were Enrolled in Government-Sponsored Plans
There are over 33 million borrowers who are currently eligible for enrollment in these programs that can lead to forgiveness. The U.S Department of Education has only notified 3.5 million of these borrowers about their eligibility. The Federal government will make a projected profit of $127 billion off student loans in the next 10 years. Private lenders are budgeted to make a pretty penny as well so it makes sense that so many Americans are not being notified about these programs.
At Student Debt USA we strive to spread the awareness of these student loan forgiveness programs. Call us today to see if you qualify.