Cartoon by Clint FultnerAccording to The College Board, in each year between 2000 and 2007 an estimated 60 percent of bachelor’s degree recipients took out student loans. In 2007-08, lenders provided a staggering $17 billion in private loans, up 592 percent from just a decade earlier.
On the surface, these numbers seem entirely plausible due to the soaring cost of higher education. However, we can’t help but wonder if this number is inflated by students who take out loans unnecessarily, simply because they are available.
In addition, it seems scores of students who get a loan for school know little or nothing about what is expected of them in return.
Therein lies the problem. In our poll this week, more than half of the students who had loans did not know the rules by which they were expected to abide. Since the average debt per borrower is $22,700, according to The College Board, this is a serious problem.
The problem is compounded by the fact that Sallie Mae reports 84 percent of college students owned a credit card in 2008, up from 76 percent in 2004. Among those, the average balance grew to a record-high $3,173.
It seems clear that today’s college students have no fear of debt. Annette Morgan, financial aid officer, said this needs to change.
“Students need to consider the ‘big picture,’ and that KC may not be the end of the line,” she said. “If they plan to transfer to a four-year university, they can expect their expenses in tuition, fees, books, transportation and housing to at least double. Students need to be aware of the enormity of loan debt that could accrue by graduation, and how expensive their bachelor’s degree may really become.”
It may be encouraging that Pew Research Center says a record-number of students are enrolling in college, but that also means record numbers are plunging into crippling debt.
If students must accept loans to get through school, so be it. However, we believe each student should take careful consideration before agreeing to accept money that will have to be repaid later. It could end up turning your college education into a curse instead of a blessing.