For college freshman, this Fall is unique in that our students have enrolled in the wake of the recent recession. They have embarked on an academic journey that for 2/3 of the population will severely challenge their wallets – some to the point where they will be forced to end their trip. Hopefully, they have done their due diligence to arrive at the school that is a right fit for them and maps to their career aspirations for after they graduate. Unfortunately, retention statistics tell us that this isn’t always the case and many students don’t figure that out until it’s too late.
This year it would appear that the problems will only worsen. The Wall Street Journal recently published an article reporting that students are borrowing more than ever before to make college a reality. The article predicts a remodeled future for graduates based on grueling loan repayment periods. Delayed marriages, delayed mortgages, delayed families. It’s been a growing trend over the past few decades, but will become more widespread as our young people continue to accrue large debt at a very young age. Of course, that becomes an issue for the students who actually graduate and can find work to start making payments and eliminate their debt– which now is averaging 10 years for students to complete.
WSJ reports that as “New numbers from the U.S. Education Department show that federal student-loan disbursements — the total amount borrowed by students and received by schools in the 2008-09 academic year — grew about 25% over the previous year, to $75.1 billion.”
According to the article, the continued availability of these funds allows colleges to increase tuition, thinking families are still able to afford to enroll. As a matter of fact, the average student debt burden has almost doubled in only the past dozen years. And as the government trends towards lifting loan ceilings instead of monitoring tuition increases, the problems will persist. Students will continue to question whether or not they made the right decision – after the fact.
In my last blog, I focused on our technology’s ability to help students reconcile career decisions with college choices and, ultimately, debt burdens. We believe, in as early as grade 7, students should be making sensible decisions about their college and career planning. Unfortunately, that is not always the case. As reported in the WSJ,
Some recent graduates say they wish they had known more about the consequences of debt before taking it on. Lillian Russell graduated from law school at the University of Pittsburgh last year with $181,000 in debt from her seven years in school. She has spent much of the past year looking for work. In recent weeks, she found a job clerking at a small law office. While she settles into her job, she has deferred payments on most of her federal loans, though interest continues to accrue.
"I wish I had considered the long-term impacts of what I was getting into," Ms. Russell says. When she entered school, "the idea was I'd take out the loans, get a job, and pay it back," she says. It seemed straightforward. But as the economy has soured, "I feel like it's shifted a lot of my life goals.”
The college and career planning process in fact, is everything but straightforward! At ConnnectEDU, we know this firsthand. That is why we will continue to provide our tools to students with the goal of helping them avoid the mistake that Lillian Russell feels she made after realizing she didn’t have enough information in her decision-making… this is becoming a very expensive mistake!