While a college degree is well worth the money, student loans can give anyone the blues. According to the Consumer Financial Protection Bureau, student loan debt is more than $1.3 trillion and continues to rise. For many younger Americans, it has become the largest household debt.The Department of Education offers forgiveness programs to help borrowers with student loan debt. These programs include the Public Service Loan Forgiveness program and the Teacher Loan Forgiveness program. Both programs are designed to alleviate the student loan burden. [Read more…]
College can be expensive! But there are still ways to help with the cost of college without getting into debt. Here are five ways to pay for college. [Read more…]
Yes, graduating from college is great but student loans sometimes can be a headache! However for many grads, this is becoming a common story. Approximately 70% of 4 year college graduates are leaving not only with a college degree but student loan payments.
According to the Consumer Financial Protection Bureau (CFPB), student loan debt has risen to more than $1.2 trillion dollars, a more than 20% increase from the year 2011. Furthermore, student loan debt is rising at an alarming rate, only second to household mortgages.
Although the burden of student loan debt can be a bit overwhelming, there may be some relief in sight. The Department of Education offers the Public Service Loan Forgiveness (PSLF) program to individuals who qualify. The PSLF program allows for student loan forgiveness for borrowers who work in the area of public service full time. If you are having making payments, also consider exploring payment options.
Here are some helpful tips to determine if it would work for you: [Read more…]
Student loans for the last few years have exponentially grown to more than $1 trillion dollars according to the Consumer Financial Protection Bureau. Coupled with the rising costs of college, which has risen on average of 1.6 percent over inflation according to the College Board, student loan debts are becoming way too common.
More than 60% of students are graduating with an average student loan burden of close to $30,000 according to the American Student Association.
While President Obama’s student loan relief plan expects to help more than 5 million struggling Americans with their student loan debt, the question remains – is it enough?
The Pay as You Earn Program
The executive order signed by President Obama expands the current program – Pay as You Earn. This program allows students to cap current student loan payments to 10% of their income and provides forgiveness after 20 years. However, only certain loans qualify and borrowers must show a partial financial hardship.
Currently, the program excludes borrowers who have taken out loans prior to October 2007. The President’s executive order would extend the program and allow those who have taken loans prior to this date to qualify.
In addition, the executive order aims to work with student loan providers to help borrowers remain out of default. Keep in mind, the executive order does not go into effect until December 2015.
College grads need jobs
While the student loan relief plan is a step in the right direction, there are many other issues that still need to be addressed. One of the key issues is college students are finding it difficult to find employment. According to a survey conducted by Accenture, only 46% of the 2012-2013 graduates were able to gain full time employment upon graduation. The 46% represents a significant decline from the 68% of the 2011-2012 able to obtain full time employment.
Accordingly, many college graduates are forced to forego the work place and pursue advanced college degrees in lieu of employment. One such example is Ellissia Hill, a graduate student at Old Dominion University in Norfolk, VA. “I made the decision to get my masters degree the summer before my senior year. My advisor informed me that obtaining my advanced degree would increase my chances of gainful employment,” Hill says.
So, while Obama’s plan with help some individuals, there is still much more work to be done.
Kemberley Washington is a professor at Dillard University and certified public accountant. Follow her on Twitter @kemwashcpa.
When I graduated from college, I didn’t realize the many financial challenges that waited for me outside of college. From choosing the best mortgage, purchasing a new car, investing in real estate and I don’t believe anything could have prepared me financially for Hurricane Katrina!
But ready or not, it was now time. I was now responsible for making financial moves, right or wrong, it was time. And I am not alone.
Each and everyday many of our loved ones are graduating from college armed with a college degree in hand, but not prepared to tackle the financial decisions that life throws at them.
Time for a change
Understanding the mistakes that many college graduates are making on their financial journey, I am so pleased this semester to teach my first personal finance course at Dillard University!
I have developed the course to help students understand their credit reports, create short and long term financial goals, manage their student loans and debt, track their expenses, create a saving and investing plan and so much more!
More colleges to offer personal finance courses
With the rise in student loan debt and the higher unemployment rate for recent college graduates, Dillard University doesn’t stand alone. More and more colleges are adding personal financial courses to their college curriculum. A recent article finds that college students are considering personal finance courses a must have. In addition, colleges such as Cornell University, Texas Tech University, University of Georgia, and Ohio State, just to name a few, have personal financial planning programs available to their students, The number of colleges continues to grow daily.
It is my hope that when my students walk across the stage with a degree, they also walk across with the knowledge necessary to tackle the financial decisions that awaits outside of the “Dillard’s Oaks.” While one course is not the end all, it is definitely a starting point.
Tell me your thoughts! Are you interested in taking a #kemcents personal finance course? Drop me a line at firstname.lastname@example.org or Tweet me!
Remember: your choice, your future!
Kemberley Washington, CPA is a professor at Dillard University and writes a finance blog at Kemberley.com. She is the author of The Ten Commandments to a Financial Healing. Follow her on @kemwashcpa or hashtag #kemcents.