Student (College) Loans

[jshots]

3 hours ago, boogielicious said:

Research how the GI Bill after WWII contributed to this. It lowered tuition for a significant number of years. When that dried up, costs then outpaced inflation.

I have a BS and MS in Chemical Engineering. My MS was paid for by my company otherwise I would not have done it. 

My son started college in business but did not like it and dropped after a year and a half. He’s doing well now and debt free. We didn’t like the choice at the time, but now we’re proud of his making a decision early. He still has an account to use if he decides to do continuing education.

I did a similar thing to your son, the mental strife it caused after a lifetime of "GO TO COLLEGE" cost my mental health a lot at the time.
 

There is just no way it continues to work as is, either colleges implode as people start going elsewhere for education, or it becomes completely government provided.

Edited August 31, 2022 by jshots

[StuM]

22 minutes ago, jshots said:

There is just no way it continues to work as is, either colleges implode as people start going elsewhere for education, or it becomes completely government provided.

Gov't provided may be the answer, similar to how our property taxes support K-12.  My concern is that typically the Gov't is not good at controlling costs and also as a taxpayer I would not want to pay a lot for a degree with low income potential.  Thus paying same cost per credit hour for an Engineering degree for example and a Art major does not make sense. I am not meaning to pick on Art majors, just that field tends to have lower earnings potential than an Engineering degree.  Attached is a list of some "low paying degrees".  This is a couple years old so I suspect the incomes have gone up a bit but it makes the point.

I understand the value of literature & art just have a hard time using my tax dollars for anything other than a degree in a field that has income to justify the cost.

20 Lowest Paying College Degrees | Should You Avoid These Careers?

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Starting and median salaries for the 10 lowest paying college majors and lowest paying college degrees. Find out which college degrees pay the least.

There is also some concern that the current Debt Forgiveness plan may actually increase tuition down the road due to changes in IDR thus costing more tax payer dollars.  See story below.

 

There's a giant loophole in Biden’s student-debt relief that could make college even more expensive. Here's how it works

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Changes to the federal student loan income-drive repayment (IDR) system could incentivize universities to charge more, critics of Biden's student loan forgiveness plan say.

Unfortunately this is complicated issue with no easy solution.

[Elmer]

On 8/30/2022 at 1:22 PM, StuM said:

My suggestion to limit amount of loans based on the earning potential of a degree may force lowering some costs.  If a student can only get $20,000 in loans the schools will not be able to charge $100,000 unless the student can come up with the difference.

I agree that not all need to attend college.  My next door neighbor's son was not good in school but after H.S. got an apprenticeship and now he is a CNC Machine Operator earning good money.  Apprenticeships and Skilled Trades should be given as much consideration as college in deciding a person's future.

A single semester of college can cost $20,000 per semester. If the student needs to cover housing and meals, they may need to take out a personal loan. Alot of these loans have elevated interest rate.
My neighbor's kid went to medical school and got their doctorate. In the 15 years since graduating they have paid off $120,000 on their $120,000+ loan and still owe $120,000.
It is the interest rate that is burying them.

On 8/30/2022 at 1:54 PM, StuM said:

All valid points.  I did say that my Utopia and Reality are not always in the same universe but still want to see something other than taxpayer bailouts.

Taxpayers have bailed out the auto industry , airline, banks,  etc....., and I don't recall that any of these industries drastically changed. The bail out was during tough economic times to keep the business afloat, employees working and lessen the economic impact. 
What is wrong with providing the same support to those who are in debt and are part of the workforce.
The amount of money not going to pay loans will likely go back into the economic and hopefully provide a boost.
I do not see why we punish people who chose to educate themselves, but because of their economic status had to take out what ever loan they could get. And because of this they spend a lifetime paying off the interest that is incurred!

[iacas]

12 minutes ago, Elmer said:

I do not see why we punish people who chose to educate themselves, but because of their economic status had to take out what ever loan they could get. And because of this they spend a lifetime paying off the interest that is incurred!

Wait, who is punishing them, exactly? They're making a choice.

If you can't afford something, don't buy it.

This isn't the same thing as a bail-out.

Again, I'd be for college or tuition/housing reform. I'm not really for "here's $20k because you agreed to these loans."

[jmanbooyaa]

32 minutes ago, iacas said:

Wait, who is punishing them, exactly? They're making a choice.

If you can't afford something, don't buy it.

This isn't the same thing as a bail-out.

Again, I'd be for college or tuition/housing reform. I'm not really for "here's $20k because you agreed to these loans."

Yes! I cannot accept the answer well I didn’t know what I was doing. 

[Elmer]

47 minutes ago, iacas said:

Wait, who is punishing them, exactly? They're making a choice.

If you can't afford something, don't buy it.

This isn't the same thing as a bail-out.

Again, I'd be for college or tuition/housing reform. I'm not really for "here's $20k because you agreed to these loans."

"If you can't afford something, don't buy it." is the philosophy behind credit cards?? with that thought process people would buy alot less. I am all for sound fiscal practices, however that is not what is going on with college loans. 
Most of those who took out college loans are lower to middle class individuals who would not been able to afford it anyway. Some are the ripe old age of 18, some do not have family or support systems.
People love to preach the ideal of "work your way up from the bottom" or "pull yourself up from your bootstraps".
However when someone from middle to lower economic means has to resort to predatory loans to get a degree (to be a teacher or Doctor) they end up paying more in interest than the loan itself. And that is plain wrong. We are allowing those from middle to lower economic means to be taken advantage, all because they believe that a good education will lead to a better earnings and life.
I am all for the reform you speak of, but that does not help those who are in need at this moment. Those who are paying a fortune back in interest, so they can dedicate their lives to working in a public hospital or a public school to help others. They are drowning in debt that they will never get out of.  
But there is no issue with tax breaks for higher earners (probably those who still believe in the myth of trickle down economics) .

Meanwhile the guy down the street who owns the local golf course had no issue taking a PPP loan and having it forgiven.  He didn't have to tap into his savings to keep what he could not afford!

I am not for handing out $20K checks to every philosophy major, however I am for a well trained work force and would be willing to forgive those middle to lower economic class who are looking to better themselves. Even more so if it benefits the public!

 

Edited September 2, 2022 by Elmer

[jmanbooyaa]

Why not go to community college first 2 years, same education you will get in that 2 years as other colleges. After that make an informed decision 

[saevel25]

IDK, when the jobs that offer the best upward mobility are those that require bachelor degrees, what is a person to do? Right now, it's just accept $100K+ in loans. Basically, they are paying a small house mortgage payment for 15+ years and hoping they can get into a job situation that allows them to pay that off. 

For me, this loan forgiveness stuff will help people momentarily. In the end, all public schools just need to be made cheaper. There needs to be more public schools, they all need to be priced controlled such that those on the lower end of financial spectrum is able to attend. In the end, education is important to everyone. We want as many people as possible educated. 

Maybe off topic, I question if there are any decent jobs out there for graduating students. Even if we lower prices for public schooling, and have more public schooling, what are the odds you actually use that specific degree in your lifetime? 

Maybe the entire way we look at education needs to be changed first. 

[jmanbooyaa]

Define decent jobs? A degree does not and should not guarantee anything. You start at a company entry level and you learn and move up. College will never adequately train someone for how the work force works. You need to start somewhere. 

[Jeremie Boop]

12 minutes ago, saevel25 said:

IDK, when the jobs that offer the best upward mobility are those that require bachelor degrees, what is a person to do? Right now, it's just accept $100K+ in loans. Basically, they are paying a small house mortgage payment for 15+ years and hoping they can get into a job situation that allows them to pay that off. 

For me, this loan forgiveness stuff will help people momentarily. In the end, all public schools just need to be made cheaper. There needs to be more public schools, they all need to be priced controlled such that those on the lower end of financial spectrum is able to attend. In the end, education is important to everyone. We want as many people as possible educated. 

Maybe off topic, I question if there are any decent jobs out there for graduating students. Even if we lower prices for public schooling, and have more public schooling, what are the odds you actually use that specific degree in your lifetime? 

Maybe the entire way we look at education needs to be changed first. 

Depends on the industry. Right now, I'm looking at jobs for Systems and/or Network administration and they are actually making allowances for years of experience in leu of a bachelor degree. Also, they tend to lean heavier on wanting certifications for various industry standard software/hardware over a degree. Again, that definitely depends on the industry you are in whether a degree is more important qualification.

[iacas]

16 minutes ago, Elmer said:

"If you can't afford something, don't buy it." is the philosophy behind credit cards?? with that thought process people would buy alot less.

So next we should bail out those who are in credit card debt? (I know you're not saying that, but… to what you are saying: so what?)

If you can't afford a college education and the loans currently required for many to do it, do something different. Go to a different school. Don't go to college. Work for a few years and then go to college. Whatever.

16 minutes ago, Elmer said:

Most of those who took out college loans are lower to middle class individuals who would not been able to afford it anyway.

Who says they're entitled to go to college on my dime. I'm fine with paying for K-12 education via taxes. This? Nah. This is a choice.

16 minutes ago, Elmer said:

However when someone from middle to lower economic means has to resort to predatory loans

You're just gonna throw the word "predatory" in there? Student loan interest rates aren't typically terribly high:

Student loan interest rates in September 2022 | Bankrate

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Students can choose either federal or private student loans to help pay for school. Bankrate can help you find the best student loan to fit your needs.

16 minutes ago, Elmer said:

I am all for the reform you speak of, but that does not help those who are in need at this moment.

But "those who are in need at this moment" is such a small slice… what about the people in need three years ago, or ten, or three years in the future, or ten?

16 minutes ago, Elmer said:

Meanwhile the guy down the street who owns the local golf course had no issue taking a PPP loan and having it forgiven.

It was a payroll loan. He didn't just keep the money. It went to everyone else who would have been out of work due to something they couldn't control and over which they had no choice at all.

Not the same thing at all, man.

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High school seniors have a lot of choices.

• Go to a community college.
• Enter the work force.
• Join the military.
• Apply for scholarships. Tons of scholarships go unclaimed every year.
• Live at home and go to a local college.
• Take out loans. Shop around for a good one.
• Etc.

[saevel25]

3 minutes ago, iacas said:

Who says they're entitled to go to college on my dime. I'm fine with paying for K-12 education via taxes. This? Nah. This is a choice.

I could see certain degrees getting some more benefit from tax breaks or reduction in tuition with capped pricing. Like, if we have a big shortage of doctors. I would be willing to say, yes use my tax money for that. Or, if we had a shortage of teachers for K-12. Critical services make sense to me. 

Political science degrees, nope, no way you need to use my tax money for that. 

 

[Jeremie Boop]

10 minutes ago, iacas said:

 

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High school seniors have a lot of choices.

• Go to a community college.
• Enter the work force.
• Join the military.
• Apply for scholarships. Tons of scholarships go unclaimed every year.
• Live at home and go to a local college.
• Take out loans. Shop around for a good one.
• Etc.

Something I wish more people would push is getting into a trade. They pay you to learn the trade and tradeskill workers tend to be some of the highest earning people out there.

[iacas]

11 minutes ago, Jeremie Boop said:

Something I wish more people would push is getting into a trade. They pay you to learn the trade and tradeskill workers tend to be some of the highest earning people out there.

Ask @ChetlovesMer how much a welder can earn.

[Darkfrog]

2 minutes ago, Jeremie Boop said:

Something I wish more people would push is getting into a trade. They pay you to learn the trade and tradeskill workers tend to be some of the highest earning people out there.

Getting into a trade is a great alternative to college for those who can't attend for whatever reason, but many trades take a serious physical toll on the body. I have friends and family who weren't interested in college, and went into various trades (carpentry, electrician, mason), and some of them have absolutely destroyed their bodies. My cousin in his late 30s has debilitating chronic pain, and still has to work 5-6 days a week for the next 20+ years before retirement.

Conversely, a friend of mine leveraged his trade skills into a big company's facility/maintenance program manager and he has a nice desk job now making excellent money.

[saevel25]

In the end, you have HS students, who are 17-18 years old who really need to understand finances, loans, expectations. I feel that high schools and parents have failed a lot of young adults in this regard. 

All that information should play a part into picking a degree. They should understand, taking some random degree because it sounds interesting means they really need to be diligent in finding a niche for them to use that degree to make a living. 

Maybe I was just lucky to have a dad who was an accountant by trade. I had to start balancing a budget with a savings account when I was like 13 years old. 

To me, the primary thing told to kids are... "GO TO COLLEGE!!! NO MATTER WHAT!!"

[ChetlovesMer]

13 minutes ago, iacas said:

Ask @ChetlovesMer how much a welder can earn.

Right now, there's a huge demand for welders. 

You can expect to start around $60K. But an experienced welder with proper certs can earn $200K per year. 

[Elmer]

54 minutes ago, iacas said:

 

It was a payroll loan. He didn't just keep the money. It went to everyone else who would have been out of work due to something they couldn't control and over which they had no choice at all.

 

That is literally what unemployment insurance is for.