What I think is absolutely nuts is how easy it is to get these loans.

My nephew, who is not very bright btw, went to the local community college where he lives. Enrolled in some associates degree classes, applied for not just the pell grant but for all the student loans offered too.....3 weeks into the semester he got a check back from the school for $3500+. Of course this money is blown on vacations and frivolous bulls***. He did just well enough in these classes for 2 years to get more loans and now has a debt of $15,000+ and has quit school with no plans of going back or repaying the loans. What's crazier is all his friends are apparently doing or already did the same thing.

I'm assuming this is something that goes on pretty regularly and is a big reason the student loan debt is so out of control. Any moron can get these loans. That boy had ZERO credit and the government was like "oh no problem, let us 'loan' you some spending money".

Now it's going to be forgiven? LMAO. Maybe he is smarter than I gave him credit for?

BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

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I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

Traditional universities are too rich and robbing people. But I agree with others on the community college route being a good option. The first 2 years at State were just about worthless anyway. Yes I had a great experience and not every kid will get that unfortunately but as far as classes go the general stuff is BS and can be done anywhere. Matriculating into your major is where it starts to really matter.

What kills me is a lot of these kids grow up with no work ethic. They just want to be handed all this stuff and now they don't want to pay the big loan they took. And some of these kids went for a completely worthless major that they now can't apply in life. There are so many degrees in college you can get that aren't worth the paper they're printed on.

Well, not for a vacation home. This is for an actual home to live in daily. Point taken though.

I know everyone is not in my situation. I know I am blessed that I can afford the payments. There are people out there, colleagues and friends, that are not so lucky. Would I stimulate the economy if I had loans forgiven? Yes, that was my point with that post.

Would it benefit many others much less fortunate than me? Yes. This is the real reason that I am okay with it. Sure, I benefit too, which does make me biased, but there are people out there who really need this. If I was excluded in any student loan forgiveness plan, because of my salary, I still would likely support it (dependent on the details). The highest income participants of the student loan program have likely already left the loan pool by paying off their loans OR refinanced via private loans for a lower rate which federal forgiveness would not touch.

I think an interesting facet of this is the argument stimulus check vs. student loan forgiveness. Studies show that 30% of stimulus checks went for debt payments, so they did not have as large of an impact on the economy as had originally hoped. I think SLF helps economically much more so than the payments. Also, the federal loan program is actually costing the government money. They are losing money already on the program.

BP - They may push to forgive credit card debt, but I do not believe this would pass for the reasoning that student loans were taken out to better one's self and to increase earning potential which benefits the economy in the long run. Credit card debt statistically comes from luxury items purchases. I do, however, wholeheartedly agree with you questioning rising tuition prices. This really needs to be addressed for long term benefit.

BP Cox said:

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I'm sure it's already started on some levels but it's only a matter of time before they start pushing for credit card debt forgiveness as well.

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Yeah...i've been careful not to build up any of that either

PA if you are so well off you should join and pay for a membership on this site rather than free loading. You know, "stimulate the economy" like you said. Practice what you preach. Some of us aren't as blessed as you and we still manage to pony up and help out the team. Glad you have done so well for yourself and don't mind letting us know. It's $9.99 a month. Surely a man of your stature can afford it right?

Also for any parents out there I'd encourage you to do a couple of things. If you want money to have around to assist your kid for college...

1. Get a financial advisor and try to start a 529 plan. NC used to suck so I use a different plan... maybe NC is better now I don't know. But I have a 529.

2. Maybe you can't afford to put much in it... but hey anything is better than nothing. The money in the account can grow tax free as well and if you withdraw for education you pay no gains tax. Encourage extended family if they can to contribute some for bday or Christmas. Again even if you come from modest background... people are getting their kids $300 PS5 or Nintendo Switch. Maybe instead get them an $80 toy and throw $200 towards the 529.

3. My 529 plans are through Virginia and I honestly can't remember the growth but I believe it's been average around 6% the last few years. I need to review a statement... getting lazy I guess.

You can start a 529 for a child as soon as they're born. Unless the democrats change it the tax cuts act of 2017 also extended it for use in primary school if you go private.

ncsualum05 said:

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Also for any parents out there I'd encourage you to do a couple of things. If you want money to have around to assist your kid for college...

1. Get a financial advisor and try to start a 529 plan. NC used to suck so I use a different plan... maybe NC is better now I don't know. But I have a 529.

2. Maybe you can't afford to put much in it... but hey anything is better than nothing. The money in the account can grow tax free as well and if you withdraw for education you pay no gains tax. Encourage extended family if they can to contribute some for bday or Christmas. Again even if you come from modest background... people are getting their kids $300 PS5 or Nintendo Switch. Maybe instead get them an $80 toy and throw $200 towards the 529.

3. My 529 plans are through Virginia and I honestly can't remember the growth but I believe it's been average around 6% the last few years. I need to review a statement... getting lazy I guess.

You can start a 529 for a child as soon as they're born. Unless the democrats change it the tax cuts act of 2017 also extended it for use in primary school if you go private.

---

My little girl was born last July

• I have already set up a 529 account for her. Put 2500 in it to get her started and then will put 500 in per year. My parents also put money in yearly for her (they do that for all of their grandchildren)
• I set up a savings account in her name and contribute 50.00 per month. It may not seem like a lot but that's 600 per year. If you take 600 per year and multiply it by18 years that's 9000 dollars not including interest. She will be her little bit to help her get started in life,
• I have a little piggy bank in her room that I put 1 dollar per week in. Doesn't seem like a lot but it its 52 dollars a year. I figure that she'll be 3-4 years old by the time she really understands money which means that she'll have 150-200 bucks in her piggy bank. I'll use that bit to help her understand the value of money. That's what we'll use when she wants something like a candy bar or something along those lines. Its not the money itself that's important, but it will hopefully help her value what she has and help her understand how to budget and knows what she has and doesn't have.

That is AWESOME. I have done similar things for my 5 and 2 year old, though when meeting with my Financial Adviser it's still alarming to see how much they're estimating you would need to pay for it.

The thing I try to remember is that many millions of kids don't grow up in a household like this and still want the opportunity to go to a 4 year university to better themselves. Maybe they're misguided, but if they don't have someone setting up 529s and supporting them as they grow up, they probably also might not have the guidance to say "don't take on that debt because you'll be paying it back for the rest of your life."

That's why I don't have a problem with forgiving a small portion of student debt that's held by the Federal Government. As mentioned, they've had a part in this as well.

cowboypack02 said:

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ncsualum05 said:

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Also for any parents out there I'd encourage you to do a couple of things. If you want money to have around to assist your kid for college...

1. Get a financial advisor and try to start a 529 plan. NC used to suck so I use a different plan... maybe NC is better now I don't know. But I have a 529.

2. Maybe you can't afford to put much in it... but hey anything is better than nothing. The money in the account can grow tax free as well and if you withdraw for education you pay no gains tax. Encourage extended family if they can to contribute some for bday or Christmas. Again even if you come from modest background... people are getting their kids $300 PS5 or Nintendo Switch. Maybe instead get them an $80 toy and throw $200 towards the 529.

3. My 529 plans are through Virginia and I honestly can't remember the growth but I believe it's been average around 6% the last few years. I need to review a statement... getting lazy I guess.

You can start a 529 for a child as soon as they're born. Unless the democrats change it the tax cuts act of 2017 also extended it for use in primary school if you go private.

---

My little girl was born last July

• I have already set up a 529 account for her. Put 2500 in it to get her started and then will put 500 in per year. My parents also put money in yearly for her (they do that for all of their grandchildren)
• I set up a savings account in her name and contribute 50.00 per month. It may not seem like a lot but that's 600 per year. If you take 600 per year and multiply it by18 years that's 9000 dollars not including interest. She will be her little bit to help her get started in life,
• I have a little piggy bank in her room that I put 1 dollar per week in. Doesn't seem like a lot but it its 52 dollars a year. I figure that she'll be 3-4 years old by the time she really understands money which means that she'll have 150-200 bucks in her piggy bank. I'll use that bit to help her understand the value of money. That's what we'll use when she wants something like a candy bar or something along those lines. Its not the money itself that's important, but it will hopefully help her value what she has and help her understand how to budget and knows what she has and doesn't have.

---

My man cowboy knows what's up. We're very fortunate to be able to put a decent amount of money towards these things. But it doesn't matter if you can put in a little versus a lot... every little bit helps. Personal responsibility and savings. People shouldn't be relying on gov't to bail them out of debt just like they shouldn't rely on gov't to take over health insurance or to cover their retirement. You have to take matters into your own hands.

BBW12OG said:

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PA if you are so well off you should join and pay for a membership on this site rather than free loading. You know, "stimulate the economy" like you said. Practice what you preach. Some of us aren't as blessed as you and we still manage to pony up and help out the team. Glad you have done so well for yourself and don't mind letting us know. It's $9.99 a month. Surely a man of your stature can afford it right?

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Wow, man, not sure what I did to you?

If you wanted to know, right now, I am cutting all extraneous costs in order to try to pay off my student loans more quickly. I enjoyed the inside information of IPS and think that James & Co. do a great job, but decided that it was not really that important in my life in the grand scheme of things. I was not sharing that information to put anyone down or say I am better than anyone else. Just saying that I am biased towards student loan forgiveness, because I have them, but even if it did not benefit me, I would still support it (again, depending on the details in the bill).

I enjoy the discussion on the water cooler when it is civil enough, so I still post. This thread had great substance and discussion even coming from people who do not agree with me, until your post.

ncsualum05 said:

---

Also for any parents out there I'd encourage you to do a couple of things. If you want money to have around to assist your kid for college...

1. Get a financial advisor and try to start a 529 plan. NC used to suck so I use a different plan... maybe NC is better now I don't know. But I have a 529.

2. Maybe you can't afford to put much in it... but hey anything is better than nothing. The money in the account can grow tax free as well and if you withdraw for education you pay no gains tax. Encourage extended family if they can to contribute some for bday or Christmas. Again even if you come from modest background... people are getting their kids $300 PS5 or Nintendo Switch. Maybe instead get them an $80 toy and throw $200 towards the 529.

3. My 529 plans are through Virginia and I honestly can't remember the growth but I believe it's been average around 6% the last few years. I need to review a statement... getting lazy I guess.

You can start a 529 for a child as soon as they're born. Unless the democrats change it the tax cuts act of 2017 also extended it for use in primary school if you go private.

---

Very solid advice, my man. Just started that for our newborn!

PackPA2015 said:

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BBW12OG said:

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PA if you are so well off you should join and pay for a membership on this site rather than free loading. You know, "stimulate the economy" like you said. Practice what you preach. Some of us aren't as blessed as you and we still manage to pony up and help out the team. Glad you have done so well for yourself and don't mind letting us know. It's $9.99 a month. Surely a man of your stature can afford it right?

---

Wow, man, not sure what I did to you?

If you wanted to know, right now, I am cutting all extraneous costs in order to try to pay off my student loans more quickly. I enjoyed the inside information of IPS and think that James & Co. do a great job, but decided that it was not really that important in my life in the grand scheme of things. I was not sharing that information to put anyone down or say I am better than anyone else. Just saying that I am biased towards student loan forgiveness, because I have them, but even if it did not benefit me, I would still support it (again, depending on the details in the bill).

I enjoy the discussion on the water cooler when it is civil enough, so I still post. This thread had great substance and discussion even coming from people who do not agree with me, until your post.

---

Ignore it man. Appreciate your posts.

I think some folks here aren't familiar with how much academic advisors in high school "sell" student loans, FAFSA, etc. This isn't just a website you visit one day. There are people you trust in high school that are actively pushing it.

Hell I was a junior in high school back in 2010 and we had a "college readiness" week. Each day, making sure a bunch of rural kids were signed up for something no one in the county knew jack **** about (most of the families did not attend college).

I obviously regret my ignorance now, but at the time I went home and told my parents..."hey guys I need this in order to attend college"....something they'd never done.

I was very fortunate to have my way paid through college. But when my wife and I got married she had racked up some debt from undergrad and law school. She had a lot of help too so it wasn't a full loan... just part of her tuition. So I know what it's like to be newly married and have to deal with student loan debt. I took some of my old savings to pay off her loan as quickly as possible. That's the only debt I've ever had that I didn't let it ride, and of course I believe one of her bills was 6% interest and the other was like 9%. This was back around 2008, 09, 10.

Right now my family is holding more debt than ever thought possible. I come from a conservative background and my parents actually believe in not having any debt at all. But I don't live that way, hell most can't live that way. When you can borrow money for next to nothing there's no point in paying big huge sums of money that you would have to dig into savings for or can't afford. I have 2 homes that are at 3% interest. I'll never hold onto them through the entire life of loan. I bought a golf cart and put it on almost 100% loan and it has 0% interest... that's right I'm borrowing money for free. The only other debt I don't like besides student loans is the wife's credit card... but she's a sugar momma so it is what it is.

The world we live in is nuts so you play the cards available.

I worked full time my entire time in college. I paid my first couple of years of school and living expenses. My dad actually paid my first semester when I first got out of high school. I didn't complete the semester. I was in a bad place at that time as I got in a bad car wreck not long before school started, and one of my passengers was badly injured. Used the rest of that semester to get my head somewhat screwed back on, and started back part time the next year and a half. Resumed full time after that. I waited tables, bartended, and did a ton of side gigs for customers (detailed and delivered cars for a wholesaler, relocated filing systems for hospitals and medical offices, painted houses, etc. I wish I still had the hustle). My dad picked up my tuition thereafter. He would have paid before but I felt I needed to earn my way back after wasting his money that first semester. I always had to pay my living expenses, and quite frankly that was more than tuition and books back then.

With all that said college costs a lot more now than it did back then. I do agree we need to find some way of bringing college costs back to the realm of reason.

I don't agree with forgiving the loans though. In all aspects of life we're considered old enough to pay the consequences of lifetime decisions at that age. Cost/benefit is something people should be able to properly evaluate by college age. Today, if I was intending to go to college I would definitely have to reevaluate how I was going to pay for it because I would definitely have more skin in the game.

packgrad said:

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I worked full time my entire time in college. I paid my first couple of years of school and living expenses. My dad actually paid my first semester when I first got out of high school. I didn't complete the semester. I was in a bad place at that time as I got in a bad car wreck not long before school started, and one of my passengers was badly injured. Used the rest of that semester to get my head somewhat screwed back on, and started back part time the next year and a half. Resumed full time after that. I waited tables, bartended, and did a ton of side gigs for customers (detailed and delivered cars for a wholesaler, relocated filing systems for hospitals and medical offices, painted houses, etc. I wish I still had the hustle). My dad picked up my tuition thereafter. He would have paid before but I felt I needed to earn my way back after wasting his money that first semester. I always had to pay my living expenses, and quite frankly that was more than tuition and books back then.

With all that said college costs a lot more now than it did back then. I do agree we need to find some way of bringing college costs back to the realm of reason.

I don't agree with forgiving the loans though. In all aspects of life we're considered old enough to pay the consequences of lifetime decisions at that age. Cost/benefit is something people should be able to properly evaluate by college age. Today, if I was intending to go to college I would definitely have to reevaluate how I was going to pay for it because I would definitely have more skin in the game.

---

I agree wholeheartedly that this is the main cause of the student loan effect. Any thoughts from you or anyone else on how to combat that?

This article (Lowering College Costs) discusses the theory that a few others have proposed about taking the federal government out of student loans. It is interesting. I just do not think this would effectively fight tuition rises. It seems colleges increase spending exponentially every year regardless of need. Are we too far gone at this point to truly fix it? Can we incentivize schools to lower costs? Do we need to scrutinize colleges spending more closely?

I agree with whomever said high schoolers are not taught financial literacy or "healthy" loan habits when applying for schools. It is pushed as pay for it if you can and borrow for it if you cannot.

Beats me. I tend to think we could eliminate a lot of liberal arts majors, or incorporate them into the curriculums where theoretically it's more in line with a post graduate productive field of study. I know that's subjective, and not at all realistic especially in today's climate.

I definitely think it's a black hole though and have no idea of a realistic solution.

Count me in the boat of someone who still has student loans but doesn't think they should be forgiven. Every decision has pros and cons and you should have to live with those decisions, not have someone snap their finger and make the negative go away.

Now with that said, the cost of college is out of control and needs to change.

I love my 529 right now. i feel like my kid's going to school for free lol. And really simple to use.

metcalfmafia said:

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PackPA2015 said:

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BBW12OG said:

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PA if you are so well off you should join and pay for a membership on this site rather than free loading. You know, "stimulate the economy" like you said. Practice what you preach. Some of us aren't as blessed as you and we still manage to pony up and help out the team. Glad you have done so well for yourself and don't mind letting us know. It's $9.99 a month. Surely a man of your stature can afford it right?

---

Wow, man, not sure what I did to you?

If you wanted to know, right now, I am cutting all extraneous costs in order to try to pay off my student loans more quickly. I enjoyed the inside information of IPS and think that James & Co. do a great job, but decided that it was not really that important in my life in the grand scheme of things. I was not sharing that information to put anyone down or say I am better than anyone else. Just saying that I am biased towards student loan forgiveness, because I have them, but even if it did not benefit me, I would still support it (again, depending on the details in the bill).

I enjoy the discussion on the water cooler when it is civil enough, so I still post. This thread had great substance and discussion even coming from people who do not agree with me, until your post.

---

Ignore it man. Appreciate your posts.

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Yup

PackPA2015 said:

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packgrad said:

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I worked full time my entire time in college. I paid my first couple of years of school and living expenses. My dad actually paid my first semester when I first got out of high school. I didn't complete the semester. I was in a bad place at that time as I got in a bad car wreck not long before school started, and one of my passengers was badly injured. Used the rest of that semester to get my head somewhat screwed back on, and started back part time the next year and a half. Resumed full time after that. I waited tables, bartended, and did a ton of side gigs for customers (detailed and delivered cars for a wholesaler, relocated filing systems for hospitals and medical offices, painted houses, etc. I wish I still had the hustle). My dad picked up my tuition thereafter. He would have paid before but I felt I needed to earn my way back after wasting his money that first semester. I always had to pay my living expenses, and quite frankly that was more than tuition and books back then.

With all that said college costs a lot more now than it did back then. I do agree we need to find some way of bringing college costs back to the realm of reason.

I don't agree with forgiving the loans though. In all aspects of life we're considered old enough to pay the consequences of lifetime decisions at that age. Cost/benefit is something people should be able to properly evaluate by college age. Today, if I was intending to go to college I would definitely have to reevaluate how I was going to pay for it because I would definitely have more skin in the game.

---

I agree wholeheartedly that this is the main cause of the student loan effect. Any thoughts from you or anyone else on how to combat that?

This article (Lowering College Costs) discusses the theory that a few others have proposed about taking the federal government out of student loans. It is interesting. I just do not think this would effectively fight tuition rises. It seems colleges increase spending exponentially every year regardless of need. Are we too far gone at this point to truly fix it? Can we incentivize schools to lower costs? Do we need to scrutinize colleges spending more closely?

I agree with whomever said high schoolers are not taught financial literacy or "healthy" loan habits when applying for schools. It is pushed as pay for it if you can and borrow for it if you cannot.

---

I think kids get wrapped up in a terrible cycle where these loans are pushed on them from the onset while they are still kids in high school, then you have teachers in the same schools pushing people to absolutely have to go to college out of the gate.

Once the kid sits down to get a loan its easy money because whoever is loaning the money knows that its going to be backed up by the federal government, so all of your normal qualifications to get a loan are gone.

The schools charge whatever they want to because the system has been built to convince kids that they absolutely have to go to college and that the loans are guaranteed so they don't lose on anything if a kid ends up defaulting on their loan.

How do we solve for this? I think the first step is to get any sort of government out of loaning money. Second is to teach kids that there are several other options outside of borrowing tons of money that you will have to pay back (don't forget that its almost impossible to discharge this loan in bankruptcy like other loans). From here I think that basic economic principals come into effect. When schools start to lose money due to low enrollments then they will be forced to re-evaluate both the service that they are providing and what they are charging for it.


I think that people forget that there are other options out there. My wife is a nurse. We did her entire two year program with books for right at 6000 dollars. From there she graduates and already has a job lined up making 50K a year. She went for her BSN and the hospital covered almost all of it so that was no cash out of our pocket. You could get the same thing if you decided to go to ECU, but it would cost you 29,496.06 before taxes (i looked it up). Your going to get the same job making the same thing, but one of these only cost 24K more than the other.....but tons of folks go the ECU route. People don't take the Community College option nearly as much as they take the ECU option, That doesn't make sense to me.

cowboypack02 said:

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PackPA2015 said:

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cowboypack02 said:

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bsorry11 said:

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People talk about the loans because it's the shiny object, but you can't fix that problem without addressing the fact that government intervention in the student debt business has caused education prices to explode. Schools know that they can charge whatever and with six clicks of a mouse that student can pay the bill.

Problem is more magnified on the graduate level where there are less restrictions on amounts loaned so schools are then able to inflate cost more and then engage in funky-accounting to put off more cost to grad students.

Any bill that forgives debt without addressing the government's role in inflating costs is dangerous because the next generation of students will face the same thing.

Additionally, keep in mind that these loans bear interest. Not sure what interest rate the government "borrows" money, but treasury bonds are at record low rates and the current applicable federal rate for debt is 1.45%. So the government, by charging 6%-7% is, theoretically, using these loans as a profit-center to fund other programs. There has been some controversy over the years about whether student loan interest is funding programs or debt relief....but the fact is that the government is making a profit on interest payments.

I'm sympathetic to borrowers because they were caught in this accounting game with the government and there isn't much that they can do about it.

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I'm not. There were other ways to solve this problem and 99% of people decided not to take another route

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I do not believe that statistic of 99% to be true. What other routes are there other than just not going to school for that specific purpose and working a trade job? Honestly, most healthcare providers worked their tails off before, during, and after school to try to limit their loan burden, but they still have them. For most medical and PA/NP schools, you had to work for patient hours anyways. These professional schools are not affordable even when working multiple jobs for multiple years.

Furthermore, 20% of student loans are held by individuals with a professional or doctorate degree. Another 36% have at least a Masters degree. If loans were not available (and school tuition remains the same or continues to elevate), we will not have many people going into these areas, such as doctors, PAs/NPs, college professors, researchers, etc. We really need these people especially in the more rural areas of the country.

Student Loans by Demographic

Here's another good resource in a question and answer format:
Who owes debt and who would benefit from forgiveness

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I don't know if the 99% number is factually correct. I should of elaborated on that more. Sorry about that.

There are companies that will pay for a college degree if you work there

There are also other routes that you can take to greatly lower the cost of your degree like going to a community college for the first few years to cut your cost from a 4 year university.

Some state governments will pay for college if you agree to work in a more rural setting. It can be done.

I did it...

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Agree that those are ways to lower the cost of education, but those aren't options available for nearly everyone and in every field. Certainly not 99% or even a plurality of students. Keep in mind that we're spoiled in NC with an outstanding and accessible community college system for residents. That's not the case everywhere.

But it still doesn't address the point I made at the outset: the cost of college is inflated because the Federal government has distorted that market by loaning whatever sum the colleges request. So in the examples you gave, that higher cost is being passed to the company or for the two years that someone goes after community college. Someone is still paying it.

Get Federal government out of the lending business for these colleges and let actual market demand dictate costs for these programs.

bsorry11 said:

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cowboypack02 said:

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PackPA2015 said:

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cowboypack02 said:

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bsorry11 said:

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People talk about the loans because it's the shiny object, but you can't fix that problem without addressing the fact that government intervention in the student debt business has caused education prices to explode. Schools know that they can charge whatever and with six clicks of a mouse that student can pay the bill.

Problem is more magnified on the graduate level where there are less restrictions on amounts loaned so schools are then able to inflate cost more and then engage in funky-accounting to put off more cost to grad students.

Any bill that forgives debt without addressing the government's role in inflating costs is dangerous because the next generation of students will face the same thing.

Additionally, keep in mind that these loans bear interest. Not sure what interest rate the government "borrows" money, but treasury bonds are at record low rates and the current applicable federal rate for debt is 1.45%. So the government, by charging 6%-7% is, theoretically, using these loans as a profit-center to fund other programs. There has been some controversy over the years about whether student loan interest is funding programs or debt relief....but the fact is that the government is making a profit on interest payments.

I'm sympathetic to borrowers because they were caught in this accounting game with the government and there isn't much that they can do about it.

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I'm not. There were other ways to solve this problem and 99% of people decided not to take another route

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I do not believe that statistic of 99% to be true. What other routes are there other than just not going to school for that specific purpose and working a trade job? Honestly, most healthcare providers worked their tails off before, during, and after school to try to limit their loan burden, but they still have them. For most medical and PA/NP schools, you had to work for patient hours anyways. These professional schools are not affordable even when working multiple jobs for multiple years.

Furthermore, 20% of student loans are held by individuals with a professional or doctorate degree. Another 36% have at least a Masters degree. If loans were not available (and school tuition remains the same or continues to elevate), we will not have many people going into these areas, such as doctors, PAs/NPs, college professors, researchers, etc. We really need these people especially in the more rural areas of the country.

Student Loans by Demographic

Here's another good resource in a question and answer format:
Who owes debt and who would benefit from forgiveness

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I don't know if the 99% number is factually correct. I should of elaborated on that more. Sorry about that.

There are companies that will pay for a college degree if you work there

There are also other routes that you can take to greatly lower the cost of your degree like going to a community college for the first few years to cut your cost from a 4 year university.

Some state governments will pay for college if you agree to work in a more rural setting. It can be done.

I did it...

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Agree that those are ways to lower the cost of education, but those aren't options available for nearly everyone and in every field. Certainly not 99% or even a plurality of students. Keep in mind that we're spoiled in NC with an outstanding and accessible community college system for residents. That's not the case everywhere.

But it still doesn't address the point I made at the outset: the cost of college is inflated because the Federal government has distorted that market by loaning whatever sum the colleges request. So in the examples you gave, that higher cost is being passed to the company or for the two years that someone goes after community college. Someone is still paying it.

Get Federal government out of the lending business for these colleges and let actual market demand dictate costs for these programs.

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Cowboy just agreed with you in his post above. I'm just not sure that those things equal each other. I admit I am no economist, but I just don't think just taking federal government out of loans forces universities to lower costs. I could be dead wrong on that thought though.

I feel like this would hurt lower income students or students with poor credit backgrounds go to school.

PackPA2015 said:

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packgrad said:

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I worked full time my entire time in college. I paid my first couple of years of school and living expenses. My dad actually paid my first semester when I first got out of high school. I didn't complete the semester. I was in a bad place at that time as I got in a bad car wreck not long before school started, and one of my passengers was badly injured. Used the rest of that semester to get my head somewhat screwed back on, and started back part time the next year and a half. Resumed full time after that. I waited tables, bartended, and did a ton of side gigs for customers (detailed and delivered cars for a wholesaler, relocated filing systems for hospitals and medical offices, painted houses, etc. I wish I still had the hustle). My dad picked up my tuition thereafter. He would have paid before but I felt I needed to earn my way back after wasting his money that first semester. I always had to pay my living expenses, and quite frankly that was more than tuition and books back then.

With all that said college costs a lot more now than it did back then. I do agree we need to find some way of bringing college costs back to the realm of reason.

I don't agree with forgiving the loans though. In all aspects of life we're considered old enough to pay the consequences of lifetime decisions at that age. Cost/benefit is something people should be able to properly evaluate by college age. Today, if I was intending to go to college I would definitely have to reevaluate how I was going to pay for it because I would definitely have more skin in the game.

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I agree wholeheartedly that this is the main cause of the student loan effect. Any thoughts from you or anyone else on how to combat that?

This article (Lowering College Costs) discusses the theory that a few others have proposed about taking the federal government out of student loans. It is interesting. I just do not think this would effectively fight tuition rises. It seems colleges increase spending exponentially every year regardless of need. Are we too far gone at this point to truly fix it? Can we incentivize schools to lower costs? Do we need to scrutinize colleges spending more closely?

I agree with whomever said high schoolers are not taught financial literacy or "healthy" loan habits when applying for schools. It is pushed as pay for it if you can and borrow for it if you cannot.

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I'd take it a step further and say the college costs / student loans have created a vicious circle (whether by design or not, probably up to the eye of beholder).

But IF loans were not so easy to get, demand would drop and colleges would have to cut cost at some point.
But colleges are doing bang up business -- at least if you drive by any campus, cranes and construction activity are everywhere. Campuses are being fitted with high-class living accomodations with tons of amenities to "recruit" versus the small over-heated dorm rooms we used to live in. Which costs more, gets passed on to the students, who then turn to the low-cost $$ from the government. Which then gives out more than it should, or could possibly recover from many students.

statefan91 said:

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BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

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I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

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I think one of the greatest disservices we did in this country is the "force kids to go to 4-year colleges" rather than offer better vocational education. Many kids are not really candidates for 4-year colleges, but get steered there by advisors, counselors, parents, etc that think that is what is necessary to succeed.
Meanwhile, there are many great paying opportunities in trade jobs, which can often also lead to small business ownership -- and many of which are in recession-proof businesses: always going to be a need for electricians, plumbers, auto mechanics, etc. But lord, is it hard to find one now!

But we have a whole ton of "social sciences" and "communications" graduates out there with huge debt that are working at restaurants right now....(but they sure did love going to those football games)

Packchem91 said:

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statefan91 said:

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BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

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I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

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I think one of the greatest disservices we did in this country is the "force kids to go to 4-year colleges" rather than offer better vocational education. Many kids are not really candidates for 4-year colleges, but get steered there by advisors, counselors, parents, etc that think that is what is necessary to succeed.
Meanwhile, there are many great paying opportunities in trade jobs, which can often also lead to small business ownership -- and many of which are in recession-proof businesses: always going to be a need for electricians, plumbers, auto mechanics, etc. But lord, is it hard to find one now!

But we have a whole ton of "social sciences" and "communications" graduates out there with huge debt that are working at restaurants right now....(but they sure did love going to those football games)

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I can attest as a general contractor. It is hard to find good labor. And it used to abound in my area. Not anymore. We sponsor a local construction academy at our community college and it was starting to help before COVID. Of course it's probably dead now.

HVAC, plumbing, electrical once experienced can make big money or like you said start their own business. Even general trades can make money... need a carpenter? Hell good luck not many of them either. Mason? Yeah... they're wanting $6-8/ block now to lay. 10 years ago it was $2.50/ block.

statefan91 said:

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BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

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I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

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LOL as someone that loves to talk and write, I loved the "I assume no one is still reading, but..."

I completely agree with all this.

Improve the quality of community colleges (many like Wake Tech, Durham Tech, and others are already top-notch). Market them hard. Do what's necessary to maintain their affordability. If they're high-quality schools and become more popular, the stigma surrounding them will be reduced.

Also, they can be a means to an end; many schools like State have great 2+2 feeder programs from community colleges that allow you to significantly reduce your total spend on university but emerge with a 4-year degree and get to experience 4-year college.

Too many people get 4-year degrees when they'd be better off learning a trade. Even if they end up doing something else it gives them a great fallback. You can be go into management training at Enterprise or start in pharma sales just as easy after learning a health sciences degree from Wake Tech as you can with a history degree from State.

PackPA2015 said:

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Well, not for a vacation home. This is for an actual home to live in daily. Point taken though.

I know everyone is not in my situation. I know I am blessed that I can afford the payments. There are people out there, colleagues and friends, that are not so lucky. Would I stimulate the economy if I had loans forgiven? Yes, that was my point with that post.

Would it benefit many others much less fortunate than me? Yes. This is the real reason that I am okay with it. Sure, I benefit too, which does make me biased, but there are people out there who really need this. If I was excluded in any student loan forgiveness plan, because of my salary, I still would likely support it (dependent on the details). The highest income participants of the student loan program have likely already left the loan pool by paying off their loans OR refinanced via private loans for a lower rate which federal forgiveness would not touch.

I think an interesting facet of this is the argument stimulus check vs. student loan forgiveness. Studies show that 30% of stimulus checks went for debt payments, so they did not have as large of an impact on the economy as had originally hoped. I think SLF helps economically much more so than the payments. Also, the federal loan program is actually costing the government money. They are losing money already on the program.

BP - They may push to forgive credit card debt, but I do not believe this would pass for the reasoning that student loans were taken out to better one's self and to increase earning potential which benefits the economy in the long run. Credit card debt statistically comes from luxury items purchases. I do, however, wholeheartedly agree with you questioning rising tuition prices. This really needs to be addressed for long term benefit.

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You are right that 30% of stimulus went to debt payments which is bad, as even the most ardent supporters of deficit spending consider it to have a significantly lower multiplier effect from standard consumer spending. But that means student loan forgiveness is even worse because it's 100% loan repayment.

And again, it's also highly regressive with more debt being held by high income graduates than average Joes or the poor. If we are concerned about the less fortunate here, student loan forgiveness is no where close to the most effective means to reach them

Packchem91 said:

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statefan91 said:

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BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

---

I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

---

I think one of the greatest disservices we did in this country is the "force kids to go to 4-year colleges" rather than offer better vocational education. Many kids are not really candidates for 4-year colleges, but get steered there by advisors, counselors, parents, etc that think that is what is necessary to succeed.
Meanwhile, there are many great paying opportunities in trade jobs, which can often also lead to small business ownership -- and many of which are in recession-proof businesses: always going to be a need for electricians, plumbers, auto mechanics, etc. But lord, is it hard to find one now!

But we have a whole ton of "social sciences" and "communications" graduates out there with huge debt that are working at restaurants right now....(but they sure did love going to those football games)

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I have a friend with a econ degree from UNC who is now an electrician after going back to Durham Tech. He makes a lot more now (to be fair, he graduated near the very bottom of his class).

I really don't have a problem heavily subsidizing CC if it's kept low cost, with focus on trades and associates that will be accepted into 2+2 programs at bigger universities.

Couple that with getting rid of student backed loans and we should see some type of market equilibrium return. Right now there is zero incentive to stop tuition increases. If you look at the costs of college over time, the increase tracks with administrator and facility costs, not professors or other more meaningful metrics.

A lot of people like to point out other countries that have free college. But if you look at those you see two major trends. First, less people overall go to college, and those who do are less likely to be from lower income backgrounds compared to the US. Less spots mean more stringent admission criteria and the middle class and wealthy get a higher proportion of total spots. Second, many really good universities look like lower level places in the US. Dorms without air conditioning, bare bones classrooms, etc. They keep costs low by focusing on essentials and not all of the frills of American campus life

I would like to see programs that are government subsidized that do not yield positive returns eliminated. If you want to earn a degree in women's studies then by all means do it and pay for it yourself. You want to major in Sanskrit...congrats. Foot the bill yourself.

Too many people are "life long learners" that do nothing but take up space, government checks and contribute nothing to society.

On the flip side if you choose to take advantage of government paid tuition and you enter the working field and contribute then you should in turn get a portion forgiven or not have pay it back. Like a work study.

I think the Teaching Fellows in NC used to do something similar. If they could do the same with electricians, plumbers, etc.... that would be great.

You get a "free" education or partially free if you agree to work for X for Y amount of years. Or if you decide to leave after Y years X is owed for every year that you didn't fulfill your initial agreement.

Has to be a better way than just giving away "free" stuff. This is the quandary that the left is facing and it the fruit of their own makings. Good luck backing out of it.

IseWolf22 said:

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Packchem91 said:

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statefan91 said:

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BP Cox said:

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It used to be that if you couldn't afford going to a four year university you went to community college first to save up and transfer after a few years. Or some would even just work to save up without going to CC.

There had been a renaissance of sorts with people getting their associates in a trade and eventually going into business for themselves.

I hate the idea of someone not having the resources to get themselves through college, but I also do not believe it is fair for some folks to do whatever it takes to get through college and pay their loans off while some could just have the ledger wiped clean.

The one question that continues to go unanswered is why does a four year tuition cost as much as they do these days? Is it all necessary?

---

I think this is a really good post. Community College should be built up and encouraged, absolutely. North Carolina has very good CC's, I drive past CPCC and the campuses they have look almost like 4 year college campuses.

I think the most important issue with 4 year colleges is cost. Cost has gone up significantly and there doesn't seem to be any sign of those costs slowing down. Minimum wage has obviously not gone up by much and hasn't kept up with inflation. So the ability of people to work jobs throughout 4 year college to offset a large portion of their debt isn't viable.

So then you say for someone that can't afford it to go to Community College. That's fine and I fully support that, but you also have to consider that all degrees are not the same. Your average hiring manager will likely be biased against someone with a CC degree vs. a degree from State or App or something. So getting that first job and experience may be easier for someone that took on that debt and went to a 4 year school vs. someone that went to CC. People obviously change jobs much more today than in the past, but getting a good job out of school can set you down a path and the advantages compound. I know because I was lucky enough to do that vs. some of my peers.

I assume no one is still reading, but you can't look at education and debt people choose to take on in a vacuum. If you expect people to have upward mobility from what they're born into, you are going to see people taking on debt as an investment in themselves to try to move up. I would guess that the majority of those you're worried about with 100k for their Art History degree are the exception and not the rule, whereas the people with 75k debt for their Business Degree making 35k out of school are just trying to pay their bills and be a productive member of society.

---

I think one of the greatest disservices we did in this country is the "force kids to go to 4-year colleges" rather than offer better vocational education. Many kids are not really candidates for 4-year colleges, but get steered there by advisors, counselors, parents, etc that think that is what is necessary to succeed.
Meanwhile, there are many great paying opportunities in trade jobs, which can often also lead to small business ownership -- and many of which are in recession-proof businesses: always going to be a need for electricians, plumbers, auto mechanics, etc. But lord, is it hard to find one now!

But we have a whole ton of "social sciences" and "communications" graduates out there with huge debt that are working at restaurants right now....(but they sure did love going to those football games)

---

I have a friend with a econ degree from UNC who is now an electrician after going back to Durham Tech. He makes a lot more now (to be fair, he graduated near the very bottom of his class).

I really don't have a problem heavily subsidizing CC if it's kept low cost, with focus on trades and associates that will be accepted into 2+2 programs at bigger universities.

Couple that with getting rid of student backed loans and we should see some type of market equilibrium return. Right now there is zero incentive to stop tuition increases. If you look at the costs of college over time, the increase tracks with administrator and facility costs, not professors or other more meaningful metrics.

A lot of people like to point out other countries that have free college. But if you look at those you see two major trends. First, less people overall go to college, and those who do are less likely to be from lower income backgrounds compared to the US. Less spots mean more stringent admission criteria and the middle class and wealthy get a higher proportion of total spots. Second, many really good universities look like lower level places in the US. Dorms without air conditioning, bare bones classrooms, etc. They keep costs low by focusing on essentials and not all of the frills of American campus life

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100% agree with your comments. Lots of plush buildings going up everywhere you look at campuses. The "arms" race we speak of in college sports is really seen campus wide, not just for athletics.

That's what I was saying in my earlier post. Even if the forgiveness was given to those who's income was less than a certain amount and excluded me, I would still support a proposal for some type of forgiveness. I know how limiting student loans can be. You could write a bill that would benefit those who are more likely to default on their loans and benefit those in the lower income arenas.

packgrad said:

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I don't say this to be a dick, but saying "if you didn't have to pay the loans you took out when you were 22 years old, you could buy a vacation home to help stimulate the economy" is not going to win over many people for why student debt should be forgiven.

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Those loans for medical school also help him make a lot more money over the span of his lifetime than the normal college graduate... that was a specific choice that he / she made... plus, I just got finished paying off my daughter's loans... took eight (8) years, but guess what? I paid off every damn penny!

What do you all think about just continuing the 0% interest rate on federal loans for another extended period of time instead of forgiving x amount of loan dollars?

Seems like this would be more easily agreed upon by both sides of the aisle and would still benefit a lot of people.