Scholars suffer with student loan debt
Student debt is higher than credit card debt, and many scholars are struggling to stay afloat.
June 14, 2013
Scholars suffer with student loan debtArticle provided by Thinking Outside The Box, Inc.
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Many educated students are now questioning whether they should have gone to college. In fact, a study suggests that one out of three millennials wish they had joined the work force in lieu of pursing higher-level education. Students are having trouble securing employment in this poor economy, making it difficult for scholars to pay off hefty school debt. The study, which was released by Wells Fargo, examined 1,414 millennials between the ages of 22 and 32.
Statistics show that student debt has reached the $100 billion level, according to Forbes.com. Credit card debt is now less than the amount of debt from student loans. Furthermore, the New York Federal Reserve Reports that number of those who are at least 90 days late on student loans has increased from 8.5 percent in 2011 to 11.7 percent in 2013.
Unfortunately, the numbers suggest that college is not always worth the cost. The degrees no longer guarantee job security. Moreover, this can have an effect on the economy as a whole. This is because former students are waiting longer before buying a home or vehicle. Without financial means, they feel limited in their ability to perform these economic rites of passage.
In addition to a poor economy, some scholars struggle with budgeting. Many have little education on how to manage finances. For example, the first financial decision many students make are with college loans, and this can be difficult to handle. For this reason, the Wells Fargo survey reveals that 79 percent of surveyed millennials believe that personal finance should be taught to high schoolers. Students can benefit from learning about investing, saving for retirement and how loans work.
Moreover, the debt is so bad that some are unable to qualify for a loan. Debt has an impact on a consumer's debt-income ratio, and many loan decisions are based on this factor. Therefore, it is not surprising that 54 percent of respondents from the Wells survey note that educational debt is their biggest concern.
The good news is that there are options. While it is difficult to specifically pursue student debt relief under most bankruptcy plans, many debt-reducing strategies can help. Moreover, Chapter 7 does address other unsecured debts, which can make student debt less burdensome. If you are unsure about your options, it may help to speak to a qualified bankruptcy attorney. A lawyer can assist you with your financial burdens, preparing you for a better future.