Every year, about 20 million American students go to college, paying thousands of dollars a year for a degree one step above a high school diploma, according to the National Center for Education Statistics. Yet these students face an obstacle that prevails over homework and remains past graduation: student loans.
Student debt from higher education is an institutional problem in the country. Students are stuck in the expectation to attend college, even if this means emptying their wallets and breaking the piggy bank.
However, this widely felt pain does not only burn pockets, it is starting to affect the professional future of students.
In the New York Times article, “The Ripple Effects of Rising Student Debt,” Phyllis Korkki argues that student debt has a direct negative correlation to start-up businesses and home ownership. Korkki explains that students are less likely to start a company if they are drowning in debt. A student is not going to fight for money to fund a business when he or she first needs the cash to pay back their alma mater.
Even further, college graduates are less likely to buy homes, Korkki said, if they are affected by school debts. These young adults do not need double the bills, which means they are less likely to purchase a home. Once cause and effect comes into play, the decrease in house purchases hurts the real estate market, which did not fare well during the country’s recession.
In 2012, the Federal Reserve Bank of New York conducted a study on student loans. The study found that pending loans added up to $870 billion. This was compared to credit card and auto loans, which make up a smaller portion of outstanding costs (credit card loans totaled $693 billion while auto loans totaled $730 billion).
For some, this economic strain adds up to the hundreds of thousands. The National Center for Education Studies found that in the 2011-2012 school year, the average price for tuition, room and board for private schools was $33,047 per year, which pulls a portion of students into over $130,000 of debt after graduation.
For Northeastern students, this number is a different story. Each year, the tuition for the university increases. For the 2013-2014 school year, Northeastern tuition cost $20,390 per term. For the upcoming 2014-2015 academic year, tuition will cost $21,267 per term, according to the Northeastern financial services website.
This means more money and, invariably, more debt. This does not include study abroad or summer sessions, two commonplace aspects of attending Northeastern and other universities. On top of that, many Huskies are paying for 5 or 6-year undergraduate programs.
As of now, graduation is a happy day followed by a life of making payments. Now is the time to change this, before Northeastern students receive another email regarding increases in tuition.
Photo courtesy 401kcalculator.org, Creative Commons.
