Borrowing for College Impacting Students Futures

As a result of the increasing debt levels, college students are having to delay many life events.
The level of borrowing grew dramatically last year. The U.S. Education Department reports that student-loan disbursements—the amount borrowed by students and received by schools in the most recent school year jumped by about 25%.
These higher borrowing levels are likely due to the poor economic climate combined with the increasing costs of college. Estimates vary, however approximately two-thirds of students borrow to cover the costs of college. This percentage is significants higher than it was ten years ago. New grads are often cash strapped due to high student loan repayment requirements. As a result, they often have to delay personal milestones such as buying a house, starting a family, etc. This trend is likely to get worse for current college students.

Given the high costs of college and the common need to borrow, it is critically important for parents to make sure their student is using their student loans only for true educational costs. Unfortunately, too many students use loan proceeds to pay for lifestyle related costs and non-essentials.

We will be adding some posts with tips for lowering college costs and reducing student loan levels.

One thought on “Borrowing for College Impacting Students Futures

  1. I graduated from UCLA in 2007 and am extremely fortunate to be debt-free right now. I have friends who owe over $100,000 in Student Loans, and others in Law Schools who will come out owing over $250,000 from Undergrad and Grad School. I had a friend break down to me last week that she felt like she was a slave, chained to this insurmountable debt that was preventing her from making any free choices in life.

    The best way to avoid the 21st century form of indentured servitude is to get accepted to a top public school like UCLA, Cal, of UCSD if you’re a CA resident and get your degree for 1/3rd the price of a private college.

    UCLA received over 57,000 applications this year though, for 4,000 Freshman spots…

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