The Real Cost of Student Loan Debt

Family Finances, Living & Spending, Planning & Saving
on July 25, 2013

Go to college, they said. You’ll get a job, they promised. The loan repayment will be worth it once you’re employed. This list of promises continues for students who are deciding whether or not they should go to college. For some people, they still believe that college is the only opportunity available to the younger generation, if they plan on finding employment. However, with rising student loan rates, a decreasing work market, and other unstable economic issues, is college still the best route to go? This content will take a look at the real cost or college and hopefully help you decide if it’s worth it or not.

Older generations think it’s easy to find a job once you have a college degree. Many of these baby boomers were part of the first generational wave of people to go to college, and were greeted with plenty of job opportunities after they graduated. However, things have changed. Not only are these baby boomers still working, but there are also more people with college degrees, which makes it harder to find employment to begin with. Furthermore, with the instability of the economy since the housing bubble collapse in 2008, companies and business are still not hiring like they once were. This means much more competition, with fewer openings to potentially fill.

Another point to consider with baby boomers is the fact that many of them had children from the 1980’s to 1990’s. This wave of births can be seen in college admissions, as colleges are becoming packed and filled to capacity, while also raising higher standards for acceptance. Furthermore, with this increase in attendance, universities can also increase their tuition prices. In turn, this makes the typical college experience much more expensive than it was for previous generations.

This increase in tuition would be fine, if there were opportunities for graduates to find jobs. But the fact of the matter is there aren’t, and many graduates finish college and have a huge student loan they need to pay back. With no job opportunities, that loan continues to accumulate interest and becomes even more of a burden for the student. For those who want to begin saving money for their future, this is impossible with no income and continually rising debts.

The reality is, getting a degree does not have the same weight as it did just a decade or so ago. What was once a commodity is now typically considered an ineffective tool to measure someone’s value. Too often it seems as if people get a job based off of whom they know or who their family members are.

The alternative to going to college is getting into a career right out of high school; ideally a vocational trade that you can gain experience while others are spending time at university. People that make this choice are not only saving money by not racking up student loans, but they are also making money right away once they start in their desired career path. Although the jobs can often times be demanding physical labor type careers, some see the experience and immediate money to be a better option over going to college and hoping to find a job after you graduate.

However, what many people fail to factor in with going to college is the overall experience you have, which can be beneficial to a person’s growth as an individual. When going to college, it isn’t just about going to class, taking tests and saving money by eating Ramen every day. It’s about meeting likeminded people and learning how to work well with them. It’s about meeting future leaders of tomorrow and learning how they work. And it’s about having an experience that people who opt for vocational work will never get to know. Students who attend college are likely to be successful, not because of the paper they earned, but because of the lessons they learned. While its not a necessity as it was in recent decades, college is still a viable opportunity for some. Just as long as they prepare for the student loans that will be waiting for them at the end.

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