"Graduating seniors who just finished their degrees on average carry debts of $19,000 or more. On the other hand, medical graduate students carry debts in the range $19,000 - $105,000 (Source: Department of Education). Tuition fees have risen 32% at 4 year private colleges whilst they have risen by 41% at public universities and colleges. Average accomodation and board and room fees at private colleges cost $29000 at private colleges while costing $12000 at public institutions." read full article here http://www.moneysavingfreetips.com/student-loan-debts.html
Well, if that is the cost of admission to society's upper echelons, isn't it worth it? In any case, the statistics are misleading - there is very little "Average" debt for graduate students. Either your folks paid for all of it or they didn't. So, your 'average' debt is either $0 or $200,000 for grad school. Who I feel sorry for are the poor schlumps who choose their career choices poorly, and end up with major school debt and no real prospects of paying it off. $80,000 in college debt when you are an english major almost certainly ensures you will be a slave to debt for the rest of your life. OTOH, while you can't get rid of student loan debt through bankruptcy, at least they can't lobotomize you & take back your knowledge.... use it wisely...
I agree with you. Unless someone else is paying for your college/university education, I think it is extremely important to view it as in investment, one that you are making for the purpose of being able to increase your earning potential in later years. It just happens that I was actually very much interested in business (particularly finance), but I do feel bad for art majors with $30-$50K+ in student loan debt... As for myself, I basically have worked my butt off during university, so I have kept my debts quite minimal. I would say that I will be paying them off rapidly, but interest on government student loans is tax deductible up here in Canada, so they are my lowest priority. Still have a couple of semesters to go, but things are looking good.
As a 24 year old, I can see how many of my friends struggle to have a balanced budget. Not because they dont get paid enough, but rather they are big spenders. I do believe if they get organized they will pay eventually their debts and start worrying about building equity. I payed my college with hundred of sleepless nights in high school and college to have a full- scholarship. Still, I did accumulate some stupid credit card debt of in my four years, which I paid off two months ago. I could do it, I have seen others do it. I believe our whole generation will do it,. A frugal style of life at our age is not what we expected, but it's the only way to make it through. lol my first post yay!!!
I agree that lifestyle has a great deal to do with this. More specifically, one can either live within your means and focus on paying down debts, or one can decide "hey, I'm done university, time to live life!!" If one does the former, things should work out pretty well; the latter choice generally leads to getting yourself into large amounts of debt. For example, I'm going to be moving soon, and one thing I will need is a new TV. I could either buy a nice little 27" tube TV to last me a few years (until HDTV takes over) for about $300, or I could walk into Best Buy and pick up a $6000 plasma TV on credit. Many people in our society would likely go for the second choice.
Nice comment. This type of mentality will assure that the education level of USA will rival those of third world nations.
Now, in fairness, while I commend the writer on their ability to defer gratification, you need to think about this - Option #1 - purchase a $300 27" regular TV, use it for 3 years, and throw it away. Then, when you have "made it" , buy a $1000 HDTV flatscreen. Option #2 - purchase a $600 HDTV LCD 27" TV, use it for 6-9 years, and then purchase the $1000 upgrade TV. Finance the $300 extra on a credit card at 15% interest for a year for $45 in interest. Total cost $645. I would argue that option #2 is actually more cost effective, even thought the initial outlay is slightly more expensive. However, at the end of 3 years you have spent $1300 with option #1 and $645 with option #2. Since you are starting out, option #2 actually makes more sense. Of course, you need to be disciplined in your purchases and make good decisions. I remember when my sister bought a $300 Coach purse while in college. While I wondered what she was thinking, she tried to justify it to me as an"investment." I laughed to myself and thought about how anyone could consider a consumer good consumable as an "investment." Particularly one that is likely to be stylish, and require replacement in 2-3 years. By the way, she leads a high-consumption lifestyle and I don't let her advise me on my portfolio.