If you're a recent graduate, or have children who are currently enrolled, then you probably know all too well that college is growing more expensive every year. To pay for the cost of higher education, many students take out loans. These students do so with the expectation that a degree will enable them to make more money, which will allow them to pay the cost of their student loans. However, a college education does not guarantee that an individual will be able to obtain high paying employment. Nor does a college education guarantee that the individual will be able to obtain employment in the field studied in college. In the current job market, many new graduates are finding the pickings to be much slimmer than they expected. Depending on the college or university, a new graduate could leave school with a huge amount of debt. According to the U.S. Department of Education, the national average cost for a college education at a public 4 year university is $6,397 annually. Numerous public universities charge over $12,000 annually, and private universities may cost up to several times the annual amount of a public university. Some experts are worried about a student loan bubble that could threaten economic prosperity in the same way that the housing bubble did. With the total amount of unpaid student loans in the United States approaching $1 trillion, many are looking for ways to deflate the problem before it gets even more out of hand. The student loan debt crisis is so large that even Congress is getting involved. Just this month, the Senate Judiciary Subcommittee on Administrative Oversight and the Courts held a hearing to discuss legislation proposed by Illinois Senator Richard Durbin, who is the lead sponsor of the Fairness for Struggling Students Act of 2011 to see if some types of student loans should be allowed to be discharged in bankruptcy. The bottom line is that, presently, student loans must be paid back in full even if you file bankruptcy, unless you can show undue hardship circumstances. This is a very difficult burden to meet. The best advice for those who want to go to college is to borrow only what you truly need, and nothing more. Perhaps choosing a college based on cost is just as important as curriculum and campus life.
The Student Loan Bubble
