Student Loan Debt Discussion

I just read this article and found it kind of interesting:

http://money.cnn.com/2012/05/31/news/economy/fed-student-loans/index.htm?hpt=hp_t2

Anyone else out there (like myself) owe huge student loan debt? Although I am working and paying it down, and it's just part of my monthly bills... Had I known that 12 years from college that my wife and I would owe more on student loans than on our mortgage, I probably wouldn't have gone to college. Should I have known not to sign loan papers when I was 17? Eh, maybe? But, at that time I thought college was the ticket to a good lifestyle. Que sera. Either way, here I am!

I wouldn't want to be graduating college any time soon, though, in this economy and at the college tuition rates that are out there now!

So, I pay my loans, put some money into PM, hedges against other possibilities, etc. But, I think that the student loan debt "crisis" is going to make a dent in our economy. As one domino falls, yadda yadda yadda...

I think that our workforce should be shifting back to making *things*, not just educating people for positions that aren't needed.

Discuss

1) Not everyone can handle college, not everyone is made equal, no that does not mean lower the standards

2) A country in general does not need everyone to go to college; we need our mechanics, electricians, welders, truck drivers, ect.

3) Many times, you can make more money without a college degree
Welder income > Sociology degree income

4) If you must go to college, take all of the basic at the cheapest accredited school you can find. Pick a major that has actual job opportunities. Work or do internships every summer. Finish at a cheaper, in state school. No one cares where you graduated from 5 years down the road.

It seems that the US pushes that "everyone should go to college" --- out of high school, it's the *thing* that you do, naturally.

It's funny that you mentioned welding. I really enjoy making things. I have too many hobbies, and I build stuff for those hobbies. After college I took two years of welding (paid for up front) at a local community college via night programs.

I love welding, I love building things, carpentry, plumbing... I used to work with my father, who was a builder with my grandfather. I love that work. But, now, I could never afford to step back and get into any of those fields. Most do pay well, but only once you have a few years in.

I am swept up in the spin cycle of debt:income, sort of.

I have saved a ton of money on home repairs and upgrades, though. A ton. I have my father and all of the tools that I need to do the job right.

ADK

ADK,
When I finished school in '79, you could get a four year degree for around 7,500 bucks. If you just wanted to do a two year thing, you could go to community college for around a grand a year. At that time, University of Cincinnati cost between 1,500 and 2,000 a year.

I think the privatization of colleges and allowing them to become profit centers instead of education centers has brought our "education system" to its knees. Until you remove the profit and greed from the equation, it will never be the same, nor will it hold any real value.

Student debt loans aggregate out to about $1 trillion. So, yes, that is a lot, but is not REALLY BIG vs. our other debts.

Still, as you guys remarked above, another domino... Any of which could be the one that brings things crashing down.

DoChenRollingBearing said:

Student debt loans aggregate out to about $1 trillion. So, yes, that is a lot, but is not REALLY BIG vs. our other debts.

Still, as you guys remarked above, another domino... Any of which could be the one that brings things crashing down.

Click to expand...

True. As a country we have some much bigger debts. The student loan debts are second only to mortgage debts, as far as personal debts go.

I smell a similar crisis coming similar to the mortgage crisis on the basis that, all in all, student loan debts have a higher chance of being bad debts. (Just my opinion, I have no good facts to reference there, but it makes sense) Where's the equity backing them in today's market? I pay them because of my sense of responsibility and the threat of losing what I have built equity in... (family, house, etc.) I'll win, it will just take a while. Although, a lot of kiddos right out of college have a no-loss-to-them scenario, unless their parent's co-signed. Even then, it puts a lot of people in a bad pinch.

I have one set of student loans that has been sold four times since I graduated. I get the sense that they are another playing card in the deck of big banks.

I'll wait and see

Well todays graduates are starting into their adulthood with the mortgage, only without even owning a house. Is it toxic to economy? Hmm, let's think. How many of them will be able to secure the jobs that will allow them to service BOTH student debt, AND a mortgage, slightly further down the road?

I think it is quite obvious, not mamy of them, actually, I believe many wouldn't even be able to repay their student loans alone, why with the pay rates for the freshman?? I am in IT, which is quite well positioned, but for the inexperienced folks, I consider their rates a disgrace, really.

But not too worry, it is all backed by US taxpayer. Screw him!

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Heh, us boomers got it all for free (-:
And we could choose any career we fancied ....
The UK state education system seemed to work back in the 60's.

Some of us even got jobs and did a 'sandwich' course, thus getting sponsored to go to college. It was a much more intense course though, with little time for traditional uni pursuits.

I do seriously question how we can all make stuff and export our way out of the hole weve collectively dug.

This can only work for a few as long as the many can find a way to pay.
Even amazing new ideas, materials and products need a steady supply of customers.
The whole world economic system is broken and a new model is urgently needed.

This question makes me look like an A-hole, but let me first announce that I don't intend it to be that way. I mean it as a serious question because I guess I just don't get it. Why should we sypathize with holders of debt from student loans as opposed to those with debt from mortgages or farms? I agree that the system is flawed and the schools got greedy.. Frankly, it's almost the academic version of the housing market pre-08. But at the end of the day we don't have to go into debt for school, do we?

As far as going back to making "things", I suppose there is a need for both management and men who actually know what they are doing. I don't think a degree makes a smart guy, it's just that sometimes smart guys go and get degrees. Othertimes, the smart guys just become regular joes that can rebuild an engine.

I hear you. I remember my first job out of school. Had basically nothing in my bank acct after paying the security deposit on my first apt and buying some suits. So when i started to get paychecks for the first time in my life i started to have some extra. The first thing i did was pay off all my student loans. I have friends that still have student loan debt. I was always a saver but this world rewards people who overconsume and spend. When i bought my first car I paid cash. I never wanted to feel the weight of someones debt on my back.

college teaches you how to be a keynes-ian

rblong2us said:

I do seriously question how we can all make stuff and export our way out of the hole weve collectively dug.

This can only work for a few as long as the many can find a way to pay.
Even amazing new ideas, materials and products need a steady supply of customers.
The whole world economic system is broken and a new model is urgently needed.

Click to expand...

...I hear you, my man! All these guys keep repeating "exports, exports, exports" - but somehow, they don't ask the obvious question- how the whole world can be "export positive", so there would be no negative trade balances, and thus hopelessly bankrupt nations? That is algebraic impossibility.

What kind of a blind idiot would believe in that, honestly - well unless his goal is to enslave people/countries financially?

How it is, that an economic model, that is NOT sustainable, if there was only one country (= no exports/imports), gets extrapolated to the whole planet (=no export/imports, on the planetary scale, last time I checked), and its suddenly deemed valid?


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I made more working in a warehouse, while going to college, than I make now with my college degree.

I think the scariest thing about student debt isn't the size - it's the fact that it is held by students and not people who have had time and experience to build up some cynicism, critical thinking and escape the pattern of copying peers. Young people can be very independent and outspoken but they are almost equally afraid of falling behind others. They also lack a healthy fear of debt because they haven't yet had to repay anything painful.

Being inexperienced, and being allowed to collect so much debt as a 'normal expectation' stymies their ability to start a productive life. It's the ultimate form of parasitism really.

It's a bit different for mortgage holders in a number of ways - they are generally older/wiser to start with (at least, they have fewer excuses here!), there are some ways to dodge/escape it (renting, selling or repossession, or starting out small & cheap) and while it has a bearing on comfort and ego, it doesn't scale proportionally to future earnings expectations. i.e. spending more on a house should not increase your future earnings (having said that - this was one of wakeup calls in the recent property market! It's not clear yet how such a wakeup will occur for students - it probably has to be forced on them).

Students have this incentive to relate MONEY BORROWED with MONEY EARNED IN FUTURE which appears to them like a doubling-down no-brainer. It becomes a nasty anchor AND they still need to deal with the mortgage issue before very long.


(this was longer, but mostly opinion and OT so I trimmed it!)

Boo Hoo story:
http://news.yahoo.com/student-loan-slavery-paying-more-loans-month-193700432.html

Let me summarize:
Person takes out huge student loans to get a useless degree and now works at a job that doesn't require said degree. Now she cries about the "slavery" of having to pay back this debt.

How long before a bleeding heart politician furthers their career by making you bail out these poor people?

As soon as the government got in to the business of backing all student loans, the banks let go of all inhibition and gave money to anyone with a fucking heartbeat. Now, who could have seen that one coming?

Student loans are why it costs so much to go to college. way too much artificial demand

DSAbug said:

Student loans are why it costs so much to go to college. way too much artificial demand

Click to expand...

fixed the unemployemt numbers a bit though and cheaper than most of the money theyve thrown at 'creating employment'

Plus they get it all back .........

Colleges have become Country Clubs for the younger set these days. Somewhere along the line they went from providing marketable market skills to social sets for so many of the former little soccer angels that need 'maturing" so they say.
I rent places to students and every once in a while I run across some pretty intelligent kids whose main goal is to get that STEM degree and make some money...compare that to the social justice majors loaded with debt whining how tough life has been on them.
Scheech!

The problem with not paying for anything is that a society loses quality because values are no longer based on merit. Once it turns into who you know and protected classes it is game over.