Alarming Student Loan Statistics: How NOT to be a Part of it
Most millennials have a hard time staying on top of their finances. One of the reasons for this is because they have become burdened with student loans. This prevents them from seizing investment opportunities, which they would only do so until after they have cleared out their debts.After doing some research, Assisting America recommends you consider the following statistics:
In order to prevent yourself from incurring student loans:Consider going to a slightly less prestigious, but budget-friendly school. Look into schools that provide merit aid. Merit aid scholarships are not solely based on GPAs, leadership skills and community involvement are also taken into consideration.
- According to the Consumer Financial Protection Bureau, the total amount of student loans has reached the $1 trillion mark.
This amount can be staggering if you are just starting out, so the rule of thumb here is to not borrow more than what your expected starting salary is. You should be able to judge the amount of college debt you will be able to manage by looking into possible jobs that match your college degree and their respective income.
- According to 1,006 schools that submitted financial data to a U.S. News survey, the average undergraduate student borrowed $27,183 in 2012. Note that:
Having another year of tuition and living expenses to pay, andEntering the workforce late in the game.You can prevent this from happening by:Making sure that you are taking a degree in the industry you want to get into.
Not allowing peer pressure or parental pressure to be a factor in choosing a degree. A sudden decision to change courses will only make your stay in school longer, and will therefore result to a need in more loans.
Consulting often with your academic adviser and career counselor to make sure you are heading in the right direction when it comes to your chosen academic and career paths.
- According to an annual U.S. News survey, only 41% of college students graduate in four years. Not graduating on time would mean two things:
A loan default occurs when you don’t make a loan payment for nine consecutive months.
This will severely impact your credit score, and make it harder to get approved for a loan or a credit card.
Also, your unpaid student loans can be deducted from your tax refund, so there really is no escaping it.
- According to the Department of Education, the default rates continue to rise for federal student loans. Note that:
Choosing the fastest debt repayment scheme.
Once you have cleared off your student loans, you may now start saving up for your retirement.Paying off student loans can be intimidating, considering the amount you have to pay. But by creating a strategic plan and carefully mapping out your college years, you can prevent yourself from being burdened with student loans.
- According to the FRBNY Consumer Credit Panel, borrowers over the age of 60 have a student loan debt amounting to $43 billion. This can be prevented by:
Tags: Student loan, student loan default
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