It’s one of the key facets of the American Dream: if you want to have a great house, beautiful spouse, and that head-turning Mercedes, then you need to get a good education. For many, an education does just that, as it provides them with the training they need to get into the field they are passionate about, to pursue the career that helps them achieve this “ideal” reality.
However, there seems to be a much darker side to post-secondary education that is strengthening its grip on the necks of well-intentioned Americans. This dark side is student debt. According to the Federal Reserve, student loan debt is now nearly $1.2 trillion in the United States alone.(1) A 2012 study revealed that the average cost to attend an American post-secondary institution [tuition, room and board] ranges from approximately $14,300 to $37,800 per year.(2)
With the cost of education so high, it’s no wonder that so many Americans find themselves swimming in student debt well beyond the years of their education.
Forever A Burden
The particularly troubling part is that unlike other forms of debt, student loans are not dischargeable in bankruptcy, meaning they have the potential to forever tarnish credit reports and bury the hopes of students carrying them. (1) As we all know, a poor credit score has a strong rippling effect on insurance rates, the ability to rent/ get a mortgage, the ability to get a job, personal relationships, and much more.
According to the Federal Reserve the median balanced owed is $14,000, however approximately 14% of borrowers owe greater than $50,000.(1) With this debt impacting the student’s ability to get a job, many wonder what solution is even available to help combat this staggering issue.
One potential option is refinancing, which can substantially lower interest rates but requires the applicant to have a steady income and high credit score – making it not much of solution for the majority of students. This cycle should make student debt’s recent rise to the top of debt delinquency rates come as no surprise to anyone.
In an attempt to shed some humor on this serious issue weighing on so many Americans, the popular comedy website CollegeHumor released a funny video back in 2012 equivocating student debt to an STD, check it out:
The Debt Collective & The Corinthian 15
In an attempt to stand-up to student debt, 15 individuals announced a debt strike against Corinthian Colleges for the amounts they owe to the for-profit schooling giant. Corinthian Colleges – which encompass Everest Institute, Wyotech, and Heald College – fell under scrutiny and lost access to federal funds in 2014 for deceptive marketing and inaccurate graduation rates. The funding loss forced Corinthian to sell or close all of its schools, something that has left many of its students in an awful situation. (3)
Fifteen of its students – known as the Corinthian 15 – are refusing to pay back their owed debt and have sought the help of The Debt Collective, an offshoot group of the very popular Occupy Wall Street Movement. The Debt Collective have been quite successful thus far in combatting student debt, and look to add the issue being faced by the Corinthian 15 to their list of successes.
Movements such as The Debt Collective, in my opinion, are certainly worth familiarizing yourself with whether or not you find yourself buried in student debt. All of these movements are a living example of the power in numbers, something we can all utilize in bringing about needed change in so many sectors of the world.
What are your thoughts on the state of student debt? Do you think it’s a sign of how backwards certain things in our world are? Or do you merely see it as a byproduct of some poor educational decisions? Let us know via the comment section below.