Student loans turn into crushing burden for unwary borrowers

Natalie Hickey left her small hometown in Ohio six years ago and aimed her beat-up Dodge Intrepid for the West Coast. Four years later, she realized a long-held dream and graduated with a bachelor’s degree in photography from Brooks Institute in Santa Barbara.

She also picked up $140,000 in student debt, some of it at interest rates as high as 18%. Her monthly payments are roughly $1,700, more than her rent and car payment combined.

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Posted in * Culture-Watch, * Economics, Politics, Economy, Education, Young Adults

6 comments on “Student loans turn into crushing burden for unwary borrowers

  1. Jeffersonian says:

    One hundred forty grand…for a [i]photography[/i] degree??? I’m speechless.

  2. KevinBabb says:

    I agree. These students need the guidance of some adults to give them a reality check. As someone who has recruited for a law firm, I have interviewed recent law graduates who have combined graduate/undergraduate student loans of over $100,000. Now, if you are going to be in the top 3-5% of law graduates who make over $100,000 on graduate, that probably isn’t a problem, esp. if you are a single 25 year old without any obligations to any other people. But for the bulk of graduates, that debt load is disproportionate to the average starting salary. Similarly, it is one thing to have $75,000 in college debts if you are graduating as a chemical engineering major making about that much as a starting salary. But if you are planning on going in the workplace with a bachelor’s degree in liberal arts or humanities, that debt load will dominate your life and oppress your existence for the foreseeable future.

    A commendible attribute of teenagers is that they see an endless horizon of limitless possibilities before them. In his wisdom, God has given teenagers parents and grandparents to temper that unbridled optimism with some dose of reality. I woud hope that these ancestors would give the young people in their family the benefit of their wisdom.

    The long term solution is going to be a revolution in higher education. I suspect that by the time my (hypothetical) grandchildren are entering college in 35-40 years, most people will not have the residential college experience of four years up in the tower that most of us on this board had. In the meantime, parents and students need to hold colleges and universities accountable for the inexorable rise in college tuitions (a recent study group composed of college bursars and other officials revealed that even these “insiders” could not explain the rise in college costs), and dis-entangle in their minds the concepts of college costs and college quality.

  3. Jeffersonian says:

    At my alma mater, a full-tuition undergraduate degree with room, board and books will run you somewhere between $200-$240,000. Outside a few narrow fields of study like pre-med (which is excellent there), I just don’t see it paying off for almost anyone at that price. There just aren’t that many jobs a BS/BA can get that justify the cost of that level of education when one can get a comparable degree from a state-run school for a fraction of the price.

    As a colleague once quipped, you’d do better to buy your kid a Domino’s franchise with the money.

  4. drjoan says:

    There is this feeling that EVERYONE has to have a college degree. As a retired college teacher I can say this is balderdash. Many of the students in our program (nursing) had degrees from community colleges AND 4-year programs that got them nothing; they felt the need to get a specialized (nursing) degree to earn money. Moreover, by the time they came to our program, they had ruined their opportunities to get another student loan (there are regulations regarding how many semesters/terms a student can be funded with a loan.)
    We need to reevaluate our philosophy about “higher education” and the need for advanced degrees. My husband has a bachelor’s degree and has been a successful businessman for over 40 years; he never felt the need for that MBA that peers kept pushing him to pursue! (I also think he is smart enough so that he might not have even needed the BA!!)

  5. Jeremy Bonner says:

    At the oh-so-generous institution where I worked as adjunct faculty this past semester, I was paid $2,250 a course (it would have been less without a terminal degree). This works out at no more than $15 an hour. The university in question charges its students around $19,000 per year. It also relies on large numbers of adjuncts teaching at three-quarter time (so they don’t trip the requirement for benefits). All of which begs the question: Where is the money going if not to pay those who actually teach? I’m sure we all have our own ideas on that.

    [url=http://catholicandreformed.blogspot.com]Catholic and Reformed[/url]

  6. CandB says:

    As a former adjunct professor, I can add that this is a racket. It’s a business. The schools are making money on both the tuition and the financing, and they are knowingly misleading students to incur unrealistic debt. I have known foreign students, mostly from India, unable to get student loans, who are willing to live modestly and work their way through. When did we get brainwashed into living our lives based on debt?! The H&G;TV show, What Is My House Worth is a good example. It asks the question: Can I get a home equity loan to tackle the next project to up my value? It’s a reacket.