It would be so nice if the DoE actually looked into why Universities are growing tuition costs at 50% per year and giving their leadership staff million dollar salaries to never show up and do any work. Lets also address why education costs too much as well.
Universities charge more and more because it’s almost guaranteed that students will take out loans. Especially since most people in the US can’t finance their education out of pocket. So the only reason prices increase is because students continue to enroll. No matter what they decide to major in. And we already know all degrees ARE NOT created equal.
College increases tuition, kids take out more loans, government gives them more loans, and College tuition increases because the government keeps giving out loans to kids who have no idea what they're getting into. Now we have the government trying to fix what they started
@Erik Anders Tuition cost will keep increasing if the government can't stop handing out loans that they know people can't pay back. The government is in bed with major college institutions.
What sucks is you have a ton of students who did everything "right." They went to community college and then to a local public university and majored in something that would get them a decent-paying job yet they still ended up with insane amounts of debt that is impossible to keep up with due to the interest rates and high cost of living.
@@tslonaker4609 Nothing is inherently right but it doesn't mean that it has to be made worse for it to be "right" according to the standard that you may be thinking of. lol
@Mrbambinovideos The "right" way may be subjective but I think we all could agree taking on loads of debt to get a "high paying job" that won't even pay off said debt off is not "right" way.
@@tslonaker4609 In that regard, most would agree, assuming people are well-informed. Unfortunately, this is just how most would fall for within the framework of a capitalist society. There will be people who have to lose, not everyone can or should win for those "high-paying" jobs via an investment of a college degree. Nevertheless, it's muddled in with many factors that can sometimes be made worse by decisions that seem right.
Let us please note that Student Debt is the only debt that cannot be erased due to bankruptcy. All other forms of debt can be forgiven by law. People can go to a casino and amount an enormous amount of debt & they can declare bankruptcy at some point but student debt cannot forgiven. The majority percent of the people that have student debt want to repay it but the current state of corporate America & bank financing makes if very difficult for people to gain employment that pays enough to make regular repayment possible.
Funnily enough, Biden was one of the few Democratic senators who voted with republicans back when they chose to make student loan debt permanent. Now his own administration is having to figure out how to fix the ramifications of that vote. Because it had huge ramifications. College prices went up so much because the schools knew that students would be forced to repay the loans no matter what.
Because the enormous amount of debt people can gamble away is granted by a private firm, a bank. Not taxpayer dollars. And for those who point at the 08 bailouts as taxpayer dollars into private banks, yes that was a terrible thing a democrat, Obama, did.
@@toomuchpassion2361 Technically the amendment that you are referring to was added to the bill at the last second & there is actually a recent documentary trying to determine who actually added it. So there are many people that voted for that bill that were completely unaware that the paragraph was added.
@@nicktaylor1003 didn’t we just bail everyone out again in 2020 under trump? There were the ppe loans for business and the airline bailouts. Is that not taxpayer dollars into the private sector?
Make schools accountable. Let them issue the loans, not the government. Then they might care about who they admit, what is required for a degree, how much it costs, and if their students find adequate employment.
In other words, the payment based plan method was never a good idea to begin with and shows extreme financial irresponsibility on the government’s part for creating a bad system
What the video failed to add is that income based repayment will grow as your income grows. Mary had a payment of $67 year 1 by the end of the loan her payment would be $500 to pay down all the accumulated interest. It is a terrible problem however, as it assumes wage growth through time.
Let's not forget the people who decided also to be a part of that system by robbing their own energy through interest by getting into a debt for a useless degree. Gotta take responsibility here too pal.
I must have missed the part where the Federal Government has implemented the income tax forgiveness program. Locally, my town has yet to implement a property tax forgiveness program. Maybe we could simply stop issuing student loans PERIOD. THAT, would fix the (future) student student debt problem.
@@AngelE666 absolutely not. Name one thing govt involvement helped. Schools are so expensive now because of government backed loans. They caused the problem. Schools need to be held accountable, not subsidized.
I think they should just make student loans interest free. That would subsidize education essentially but be favorable towards everyone’s income limitations w/o feeling like a penalty.
YES!!!!!!! The compound interest accrues the minute you sign the loans. You already owe more than you borrowed as soon as you graduate. The interest is killing us, not the loans themselves.
@@extra_ice_girl yes and a lot of the other alternatives would be much more of an uphill battle. Like universities aren’t going to like the government dictating how much they can charge… and sl forgiveness is really a bandaid because it doesn’t address future sl borrowers and is costly.
That's just like giving billions of taxpayer dollars to useless activities of universities like facilities/administrators/social, very little of which goes to academic research. What should happen is a cap on federally-backed student loans which would reign in university tuition.
@@joshitheyoshi2533 the only issue with capping sl borrower amounts is some programs cost way more than others. Like becoming a doctor, lawyer etc is costly and that would then leave some professions to only advantaged students. I know me personally, my licensure requires five years instead of four…. They could totally cap undergraduate borrower rates lower though but again, some low income students need higher amounts to cover housing/food. It gets really tricky😓
I don’t think any policy regarding student loan is effective unless you address the underlying issue that is rising tuition costs. But what do I know? 🤷♂️
It's crazy, the same professors crying for socialist policies in the US, are moving to the universities that pay the most. Are they willing to take pay cuts? Probably not, and would seek other employment if their current university successfully implemented such salary and benefit cuts.
@@aquaneon8012 the loans are backed by the government in the event of student default. This gives 18 year olds far more credit than the free market would ever do. So then universities raise their tuition because there is so much money available
This comment is a sermon and a half. Preach on! I was absolutely floored when I found out what endowments are, how they operate, and how much money some of these schools literally have just stacked up doing nothing for the students. It should be illegal for them to do that and still increase tuition.
I’m a student loan borrower, but my debt is manageable -- regardless if the 10-20k is knocked off. Still, I feel amortization is absolutely insane. I didn’t even know what that was at the age of 18 when I first started taking out the loans and most kids probably don’t. Financial literacy is so necessary and should be mandatory in our schools- smh
@@Phat737 Most people are told you have to college to have a good life. No other country traps their youth in cycle of debt for the crime of building job skills.. If you think it’s the students fault the propaganda worked on you son
It didn't always matter if you understood amortization if you were poor enough and high achieving, they often counselled you to go in a fiery manner. It was your best chance and safer to go, supposedly
@@thatgreenstuff Well when you wanna specialize in certain fields and/or have an easier path to 100k a year then absolutely yes is college necessary. The problem is also more and more jobs requiring degrees.
And what really needs to he added to this plan is that we should not be charged daily interest while we’re full-time enrolled in school. That in itself puts you 4-6yrs into interest rates just by being in school.
yes, I just posted about this. That is the biggest crock out there. My wife had over $20K in loan interest the day she graduated from med school on top of over $100K in principle on the loan. Then you can only deduct $2,500 per year of loan interest from your taxable income. The system gets you in debt quick and doesn't properly incentivize you paying it off as soon as you can. In the end my wife and I just said screw it and paid it all off as soon as possible. The only loan we have is our house on a fixed rate 3% mortgage. No education loans, car loans, cc debt, etc..
it's not illegal. that's how loans work ...loan issuers want you in debt longer than you should. so they keep making money off of you. "monthly payments" is the name of the loan game.
Except you're never going to know what can or can't be paid off monthly if you issue the loan before the borrow knows what their income is, which is fundamentally what happens whenever you issue student loans.
My question is, it feels like this is only for Government loans. Most students I know also have "Private loans" from predatory companies like Naviet and Sallie Mae. When is there going to be some real systemic change to how we approach educating our population, regardless of income, ensuring we have a population ready to do the work of the future, and become contributing citizens (and consumers because thats what we really care about) without being saddled with oppressive debt? America is getting education very wrong, and it shows. It's so disappointing.
Dude if you cannot afford college don't go. Simple as that, there are a plethora of options that will make you as successful if you work hard. But I'm sure entitled lsoers are incapable of hard work anyways thats why they go this route
Why? Did they exhaust the amount they could take out using Federal loans? Did they enjoy that really expensive 4 year study-cation with parties, a climbing wall, and a lazy river? Did they work part time during the year and summers? Hopefully they didn't take out Doctor or good Lawyer loans for a 50k/year job.
@@JacobAnawalt Really being prejudice there assuming every college student just parties hard. More students are actually studying and doing their work. Many working part time jobs during breaks if not during the year. You can't afford to spend your years partying when you can barely afford it even when working your tail off.
@@JacobAnawalt As a college student I had a take out a loan TO MOVE AND HAVE A PLACE. Because rent gone up a lot and wanted to live with my husband while going to college. My husband took out a private loan because he COULDN’T originally get a government one. Just to pay for classes and he didn’t know how too until I showed him how. Why would you assume the worst in people needing a student loan? Both of us are working part time and every student we met also working.
Navient, Nelnet, and Student Loan Marketing Association (Sallie Mae), are Loan servicers. They are businesses that profit off the fact that you have to send in a payment every month. You are also supporting them, as well as paying off your student loan. Not only are you gaining a degree to show how smart, disciplined and hard-working you are (academically) to potential employers, but you have graduated into the world of supporting these loan servicers, as well. Bet you didn't know that.
I don’t know how but you’ve managed to package an unbiased analysis that is more entertaining than the sensationalized segment of economic and financial news. Thank you for your efforts to be the signal and not the noise. I understand that the economy is in currently in a downturn and that we must wait for the stock market to recover in order to break even and make a profit.
@Lloyd Bernard Exactly why i enjoy my day to day market decisions being guided by a portfolio-coach, seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not outperform, been using a portfolio-coach for over 2years+ and I've netted over $800k.
@Lloyd Bernard KAITLIN ROSE STERNBERG. She's a reputable tutor who showed me that profits can be produced in both bull and downturn markets. She talks about investing, insurance, making sure your retirement is well-funded, and searching for methods to create a volatility buffer for investment risk, among other topics.
Helpful tip, pay weekly instead of monthly. So if your student loan is $400 monthly, pay weekly about $95 every Friday or so. That’s what I did especially if your income fluctuates a bit. You don’t get a big surprise at the end of the month, and it keeps you consistent. I paid off all my student loans and I definitely wasn’t making a lot of money some years, but now I’m in a much better situation.
Also don't fall for the scams that all the alternative loan programs are. Don't consolidate, don't take the 20 or 30 year plan, don't take the income based, don't take a long forbearance. Most people I know that have problems were because they were promised a deal with lower payments now and didn't look at the long term costs. It sucks but the best thing you can do is accept current struggle. It will get better as you get use to working in your means and get raises. Just don't sell off your future.
@@amexsucks3015 These programs have been around much longer than that. The programs aren't inherently bad, for the most part, but they are dangerous tools. In many cases it is someone has a problem, got an ax stuck in a log. They tell the boss the logs are too strong for the ax. So they get handed a chain saw and try to dig out the ax.
@@barongerhardt The way some companies like Navient spread lies and conceal the truth was truly shameful. No wonder there were so many lawsuits against them. The fraud in the student loan industry is staggering.
Its not much better in the UK unfortunately, graduates end up with just short of £50,000 ($60,000) and they have to keep paying an amount depending on their income until the balance (with interest between 9% to 12%, much higher than US student loans) is paid off or 30 years at which point the loan is forgiven. Not only are you going to get a lower salary than what they have in the US, you're also going to be paying the loan off for 10 more years.
@@scifirealism5943 Most Scandinavian countries have universal tuition. In fact Iceland only cost $750 for international students when they register for a semester. Citizens get in for free.
@@NotAHomelessGamer that makes me cry as well. College is not only not free here but it's completely unaffordable for someone making minimum wage. $750 a semester? My Community College costs $5,000 a semester.
When I did university in Australia my loan was interest free and only started income deduction payback after I reached a certain salary. If I never earned enough to pay it back, the loan never needs to be paid without consequence.
@@benw4401 probably foreign students. Here in the UK we have a max cap on how much universities are allowed to charge Brits, but they subsidize that cost by charging international students more. The cost varies but some people I went to university with were paying 4x more than I was because they didn't have British citizenship, and that meant there were no laws surrounding how much they were allowed to be charged.
What they should have done is just limited the interest rates on the federally backed loans. I went in thinking the rates were 2% because that what they'd been. When I signed up for grad school loans, turns out they were 8-10%. And the first 10 years out of school were rough. So despite paying $300k over the past 10 years on an original $490k in debt, I ended up over $700k when COVID hit. We've been blessed and have got it back down to $650k. But we'll have to rely on the IBR forgiveness but even if we get that, there's a tax bill on what's "forgiven". So 25 years after graduation I'll owe the IRS about the same amount I owed the school originally, AFTER paying hundreds of thousands on it the whole time AFTER taxes. I have to earn an extra $80k a year to pay $50k on my loans. Getting screwed big time. Three solutions: 1. Drop the interest rates 2. Student loan payments aren't taxed 3. Kill the tax bill for the forgiveness (And hold the schools accountable for all the defaults!!! Stop guaranteeing the loans to the schools, the cost of my education more than doubled between the time I started working on it and actually getting in, because, why not?)
This seems absolutely insane to me. What education is worth half a million dollars?? I graduated with 13k in debt after putting all the money I made from 3 internships into it before I graduated. I came out with an engineering degree as well, so ya know something actually useful despite the lower end cost.
This is something people have been sleeping on. The obvious headline is the 10k in debt forgiveness but the income based plan is so so much more important for many borrowers and for borrowers going forward. I actually hope this continues to be ignored otherwise who knows when Republicans will start suing over this as well.
People make bad decisions on the roads, should we stop subsiding those? Tax payer money will never spent with 100% satisfaction. Stop making it seem like helping out millions of people with little to no effect to your finances is a bad thing.
@@ron88303YESS!! Use my tax dollars to train the jarheads and to build hundreds of fighter jets that get “lost”. The price of 10 of those jets is enough to get every persons student loans fully forgiven lol.
@@joshhoward1289 It is taught in high school. Most states (if not all) require one semester of it under the names like: personal economics, personal financial literacy, or consumer education. You are also required to go to a several hour course that teaches about just student loans and how interest and other terms work prior to getting a federally backed loan. The problems is people don't pay attention.
Mortgages should be amortized, since they are a big chunk of money, you should be able to pay it off in 30 years. A student loan should be a simple interest (not revolving) loan, the same P&I every month, no matter what. No one should be stuck with a student loan for 30 years.
It may have already been mentioned here in the comments but it also needs to be taken into consideration that most graduates are unable to find work in their field of studies for many years if at all once they graduate. ( As a last resort, as a mother) I ended up in Bankruptcy tying to pay for my son's education so he would have as little debt as possible afterwards. I figured 7 years on my credit was better than decades of student loan payments for him. The wole thing is FAR REACHING And extremely sad.
actually... that's smart. I wish i could declare bankruptcy on my student loans. but you speak the truth. I didn't expect to get out of college... and not find a job that paid well. I ended up having to start my own company because i couldn't find any job that would pay a decent wage. i regret my college degree and wish i could just return it
2:40 - Who takes out a loan that would take an infinite time to pay off unless you make additional payments such that the regular payments would begin paying down principal? It's basically an infinite ballooning loan if you only made the regular payments.
It’s weird how people talk about all the profits thy made by crypto trading, while I’m here with huge losses please can someone at least advice me on what strategy to follow?
As a newbie about to invest or new to the investment you must have these three things in mind 1:having a long term mindset. 2: Be willing to take risks 3: Have a trusted expert broker
I am so glad this is being changed! It wasn't this way back in the 80s when I got loans. Somewhere along the line, student loans became a business, focused on profit. It's supposed to be a non-profit enterprise.
Let's see...I owe $176,000 for a degree that cost me $57,000. I'll die in debt to the government due to their predatory loan practices that have not changed until now. Thank God there are changes in place to help future generations of students.
@@jeffreyburney6161 when you're 18 and signing up for school, do you understand and kind of loan/monetary system? How many kids get in trouble with credit cards they sign up for in the Union?
Yup. When I graduated with a $35k loan in 2006 and started my career in 2007, my earning potential was only about $30k/yr even though I was working in STEM, and I had to support a family of 3 by myself on that income. Even in 2015 my earning potential was still only $45k, but only if I worked for the employer who didn't require a Master's Degree for the job title I got. My loan balance only started going down once the pandemic paused interest. For the first time in my life, it finally dipped just below $30k this year. If the Biden forgiveness program doesn't go through, it's likely to go right back up once payments resume. I'm 46 years old. I'm going to be stuck in this for the rest of my life.
@@ajh.4131anything STEM is extremely valuable. Most places will not bother without that 4 year degree. Stem is worth it. I swap jobs every 2 years. I've quickly moved up and been in many leadership discussions where without that degree they won't bother. I'm 28, earn $112k+, and hardly work 30hrs/week.
@@missdesireindependance5194 It is an opportunity question. If the associate gets you the job/field you want, it is half the cost of a bachelor. Looking to the future, if the lack of a bachelor is going to be an impediment to the position you want you need to ask the likelihood of getting that position. If it is high and the burden of more debt now is manageable on your current expected first jobs pay, then it might be worth suffering now. Otherwise, you can always go back to school when the need/benefit is clear. In many cases you can even get it paid for.
Same, once the Covid pause started I was able to pay off a few loans making payments and using those pandemic checks. But first I had to pay off the interest that had built up that I had no idea about.
A better solution is to just reduce the interest rates on student loans instead of forgiving them. Make all student loans a 1-2% interest rates. That's more helpful and fair than forgiving the debt.
Not exactly, because you would still have plenty of people (more than 60% of those who have applied for Biden's forgiveness plan) who have already paid their principal plus x% in interest alone and still owe ridiculous amounts. It would help for future borrowers but doesn't do much for current ones. Either way you cut it, forgiveness is the only thing that will pull them out of it right now.
Borrowers have been screaming about the predatory interest rates for years. No matter how much we pay the balance doesnt go down and we've always been told its our fault for going to college. I'm very happy this change has been made but its taken far too long.
This is just fixing the wrong side of the problem. Instead of just throwing tax dollars at college and pay them whatever cost they ask for, why do we not question and reduce the cost? Also so much of the costs is based on choice. You could go to community college for 2 years, then transfer to a state school and get a 4 year degree for 50k, lets say. But if you opt to go to a "fancy" and "prestigious" ivy league school that same degree could cost double, if not more. So why should the tax-payer be on the hook because of your personal decisions. I think our efforts and resources should be to reduce the cost of college, making it more affordable, instead of trying to figure out how to pay the outlandish costs that the college says you owe. Books for one, is an absolute joke. Instead of just printing a book and using it, and allowing students to trade or use pre-owned books. The colleges and publishers basically scheme and recreate the same book year after year, forcing students to buy the latest edition, simply to undermine the possibility of students saving a buck. This would save students probably 500 dollars per semester easily if not more. Simple. Why is it that some schools charge each student 50k a semester, yet their teachers are making 30k a year? Some of these schools get endowments and donations in the tune of millions of dollars a year yet their operating costs are still so high? What other ways can we reduce costs? Maybe we should take this loan forgiveness money and create cheaper at costs colleges. Maybe take that money and create a fund for interest free loans. Either way all we are doing under Biden is giving colleges whatever they ask, without question, and allow the costs of the degree itself to run rampant. Government and colleges are in bed together, and they are just paying themselves. We need to be smarter than this...
Takeaway: Dont go with an income based repayment plan even though it is temtping with low payments. This also applies to other loans such as car loans. I was considering the same income based repayment plan when i graduated but went with the 10-year payment since I realized that the small payments wont cover the interest. It operates the same as a minimum monthly payment on a credit card - sure you could just pay $25 but if you have a large balance still on your credit card they'll charge you more due to the %APR
You should ABSOLUTELY go with IBR... you make small payments for 20 years then rest is forgiven. IBR plans are the best plans to actually end up paying the least for your loans. ANDDDD while you are making your very small payments, guess what you can do with the money you are saving? invest it. even high yield savings accounts are paying 5+%. so i pay my 200$ or whatever, take whatever I have left as disposable into high yield savings, collect 5% interest while my loans get closer and closer to be zeroed. and before anyone says anything about "but what if you miss a payment!?" or "but what if they mess something up and it says you missed a payment!?" if you miss a payment, that's on you. that's called not being respoonsible and you will learn this lesson fast with loans or credit cards if you havent yet. and then its called annual (at least) check ins. "hello ___student loan servicing company___, my name is ___, my identifying info is __(social security number and birth date)__. I was calling to request an update on the status of my loans in terms of my progress towards forgiveness and payment history. I would like a copy of your available payment history sent to my email for my records." BAM! now I have written proof from the loan servicers every year. anyone actually paying their loans off using 10 year or whatever plans is sacrificing their financial future investments and isn't savvy.
Universities are the ones that should be on the hook for any unpaid loans. They choose the students, they set the tuition, and they can make payments if their services aren't good enough for the students to pay it back.
Problem all started when the government started promising blank checks to these colleges by going “yeah sure! Charge them as much as you want! We’ll grant a $120,000 loan to an 18 year old! What could possibly go wrong?”
This happened to me, plus add in not affording the loan amount, not getting the high paying job after college, puttng loans in deferrement or forbearance, not extra paying toward principal...I've paid my loan and still owe 20years later! Definitely need financial advising to make sure youre doing what's right for you and the loan
How can you spend $30k on student loan, get a 4 year degree and only make $30k/year for 10-20 years? Should we shift our focus to the quality of the college program that Mary spent the $30k on?
Fair - there’s still a need for counselors, advisors, teachers who in certain parts make near that amount. One way or another, adjustments need to be made
I had a science degree and only was able to land a 30k salary job out of college. Unfortunately, my job was in a destination area so rents were very pricey despite having a roommate.
What alot of people DON’T consider is student loans are taken out by kids to further their career and education. The amortization schedule is soo crazy and a lot of people don’t realize that is apart of the plan when they are paying it back. It feels so discouraging making payments for years for none of it to actually be going towards the debt. I am now in my 30s. Have consistently made payments for my debt to not have gone down AT ALL.
I paid down 35,000. Defaulted. Went to get back on board and it looked like I hadnt paid a cent. That's when I gave up. In retirement they had garnished my Social Security check. It will probably be restarting again. That will be docked for the rest of my life, I guess.
A true amortization schedule would have you paying down the loans over an agreed loan repayment timeline, typically 10 years. The problem is when people apply and receive a reduced payment schedule, especially one that doesn’t even cover the interest. This puts you in a death spiral as your payments aren’t even covering the accrued interest. People taking these reduced payment plans need to understand this. It is a temp solution, not a good fix at all.
This is great, and I wish so much that this was around when I took a low salary job and was financially pinned down for a few years by unfortunate life events. The pandemic pause helped me catch up on over $20k of “capitalized interest” that got tacked on to my balance because of this mechanism. And the worst part is, no one walks you through the mechanism of the interest accrual and capitalization, so you have to find out about it by comparing your new balance to your old balance and seeing the thousands of dollars you paid that year and not understand why things don’t add up. Truly insidious. Instead of forgiveness, I would loooove to get credit for all of my payments that got eaten up by high interest rates and capitalization.
The blanket approach of approved student loans for any study regardless of cost is a system that is destined to fail. There should be a cost to risk analysis based on career, job placement, potential money earn and school analysis all prior to issuing a loan to a clueless 18 year old.
America has some of the best universities in the world. MIT, Harvard, etc. You could easily do what the UK does and give low interest study loans to any citizen that wants it but then charge international students 4x as much for the prestige of studying in America to cover the cost. That makes it easy to spot and poach foreign talent too if one of the international students happens to be a gifted engineer / chemist / whatever the economy currently needs.
Colleges and universities are not educational institutions, they are businesses that recruits investors 😂😂😂. How did I wake up with two degrees, certified and license and live in poverty 😂😂😂 it's a good thing humor is my medicine.
@0v3r cl0ck3d charging internationals 4x means more internationals go elsewhere. Prestigious schools have value bc of their student body, not bc of their curriculum. Anyone can have that same curriculum at flagship state.
This^^^ Part of getting a loan should be a discussion of the degree and the chance of repaying it. Departments should publish not only graduation, but employment and average salary information for their graduates.
The other part most people miss is what happens to the credit of people on an income based plan. Their credit utilization rates increase, as it effectively shows them over their limit. This hurts their credit scores and costs them money elsewhere. It’s not supposed to happen, but the scoring algorithms count it the same as any other debt.
It does not increase credit utilization. Rather it is treated as a fixed loan and on time payments (regardless if is $0) gets reported. It does however impact your debt to income ratio but only to what the minimum payment would be.
This isn't true as someone else mentioned it has no effect on credit utilization rate. It works just like any other student loan as it's not a revolving credit line like a credit card.
Shift the focus from balance to interest rate limiting…..this is one of the only aspects that will get bipartisan support when it comes to student loan legislation
Wow, this made so much sense to me. I’m Mary. I borrowed $16,000 in 2001 and today I owe about $30,000. I’ve paid off two $30,000 car loans in this same time frame. I couldn’t understand why I owe more then I borrowed for my student loans. Thanks.
The first could be solved with a minimum-wage hike. Second problem could be solved with the restrictions of financial aid given to colleges. Colleges have to meet certain requirements in order to receive funding from the federal government and also to provide funding to students. One of the requirements could be for universities to charge tuition that's a narrow band around the median price or that's within the price range of lower-income students.
What about acknowledging university should have never been pushed as something EVERYONE should go to? Only people who can PAY FOR IT should go and only people who are actually going for an education not to PARTY.
@@trapaneezus In 2021, full-time workers ages 22 to 27 who held a bachelor’s degree, but no further education, made a median annual wage of $52,000, compared with $30,000 for full-time workers of the same age with a high school diploma and no degree, according to data from the Bureau of Labor Statistics. Higher paying jobs usually have college requirements, even for jobs where there's no need for formal education employers opt for candidates with GED.
Maybe we shouldn’t loan money to people who are going to average 30k salary (or wherever the average salary is if it is insufficient) after college? I mean, if they can’t pay even the interest, what business do they have even getting the loan in the first place. Not everyone needs to go to college.
@@thekingoflordagames3517 yeah, let’s ignore any statistics and take 100k in student loans to get a general studies degree from Cornell. I’m sure they can pay it back
@@thekingoflordagames3517Was that a serious response??? You can’t figure out how to simply Google a job and get its low, high and average salary. Are you kidding???
When i first graduated college, so many people told me to do the income based repayment. It was clear to me that it was scam even then. I paid off my loans in 3 years not 10.
The only reason I don't currently owe more than I took out is because of the payment moratorium which is ending soon. I did everything right, but because I fell ill, but not ill enough for disability, I'm still on the hook despite generally having little income. I'd refinance my private loans, but my income's not high enough to do that either.
3 things need to happen 1) Granting of loans to be under the same scrutiny as home or business loan 2) Students making better informed career decisions 3) Allow student loan forgiveness on an income basis.
I agree with this, with a slight addition to #3: Must complete the program. Otherwise anyone can take out a lone and start school, quit halfway, and then taxpayers get stuck paying for their loan forgiveness.
3- The programs are already income-based, incl the proposed forgiveness. 1- Students have no credit history, and no collateral, so no bank would extend a loan without a guarantor. That could be parents, but then only kids from wealthy/upper-class families could ever go to college. 2- Figure the average person has a 45yr+ working lifespan - do *you* have a crystal ball that tells you what skills, credentials, and experience will be needed throughout that time? If so, feel free to share or sell it 🙃
@@otimjoshua3366 @Otim Joshua the government is the loan provider right? They are the ones providing public loans. I am ofcourse bot talking about private loans
Banks won't allow people to borrow more than the value of a home for a home loan (or a percentage over/under). Why on earth are we allowing people to take out student loans for way more than what that degree can earn in a year? Too many people are borrowing way too much, and our government allows colleges to charge way too much.
Just to see how crazy things are...I have unemployed and filed for student aid and got offered a 20k loan. I already have loans that are 19k. These people just want to make a profit at 6.8 % interest while you are in school or unemployed. The sad part is that they garnish your wages and social security if you can't pay! Predatory lending at its finest.
Can we take a moment to point out THIS is what you have to go through to get a college education in the United States, the "greatest country on Earth?" Is it any wonder that we are falling behind other nations in education? And we have radically stupid ideas that gain enormous popularity (flat earth, anti-vax, etc) because a vast majority of the population can't afford to go learn critical thinking skills. Our grade schools and high schools have turned into nothing more than glorified daycares with no-child-left-behind graduating high school seniors with a grade school reading level. Then they go out and vote on public policy and gain elected office. It's a full on recipe for disaster. For a healthy, functioning *democracy you need an informed and educated electorate. "The best argument against democracy is a conversation with the average voter."
I am not an economist nor a historian, however let's look at the reality. Housing, education, healthcare, and mental health, gun violence and stagnant wages are what working Americans are dealing with. Population decrease and deaths of despair are on the rise. These problems are being ignored and all the time and energy are being put into fighting against each other with "Identity Politics". This country is failing and soon will be falling. Only the wealthy will be happy or satisfied. Gen Z and GEn Alpha will not fall for the ignorance of the prior generations...THE AMERICAN DREAM IS DEAD! Wage slavery is in full effect.
So annoying! I was a CEO and drove a 2004 Ford Ranger so I can pay back my student loans. Colleges won’t lower tuition until the government stops loaning students so much money. Lower the loan cap and colleges will have to lower tuition. If we wipe out debt, more will come because the core problem isn’t resolved. Gggrrrr!
Why not mandate all payments should pay off principle first? Interest repayment starts when only 20% of principle is left. This optimizes payment for students and ensures an interest payment to banks. Yes it is a lower interest for banks, but the government won't need to pay such large amount for loan forgiveness if they choose to do it, Edited: typo and sentence structure
😂 that's a good idea but our government is corrupt and in bed with those that give out these loans. They will never pass a mandate like that. It is profit over EVERYTHING.
@@carrolabrams2659 I feel for ya, but my welding tech school that has more than payed for itself building tangible infrastructure doesn’t feel like paying for the bailout of your masters degree in social work through our tax dollars.
Why wasn't there any mention of the boom to the economy once loan payments are reduced or eliminated? There seemed to be only mention of how the lack of loan payment and debt forgiveness may hurt the government in billions of dollars.
My understanding is that, unless you successfully complete a Public Service Loan Forgiveness program, you will still owe taxes on the forgiven debt the year it is forgiven as it counts as "income." So this could end up still screwing borrowers who will owe more at the end of the 20-year Income-Driven Repayment plan, unless the law would change this too?
Many, if not most, student loan forgiveness programs are already federally tax free. Most states also follow the federal decision. If you qualify for more than one program, it would be smart to pick the tax free one. Other forgiven debts are taxed as normal income.
BG is mostly right, but check your specific state. There are a handful of states that still tax student loan forgiveness as taxable income. Even a gigantic tax bill is preferable (and able to be negotiated into payments) over the madness of a forever student loan interest only payment h-lllscape.
LOL ! $30K ? AMATURE. Private University costs: $ 54,154 PER YEAR. And, if they don't raise the tuition fees, that's $ 216,616 in Tuition costs alone, not including lab fees, books, snacks, a car, clothing, activities, sports, travel, electronics, software, parking, and taxes.
Because those loans are managed by private companies and that interest allows them to make money to pay for the workers. If the government managed those loans, it would be far worse than it is now, with bloated staffing and excessive salaries/benefits for those additional government workers.
@@761jared well to what Mike is saying...inflation is (historically) 3% a year....been around 8% in the past few but if you pay the exact dollar amount back over time the person who issues the loan would loose money
Why would you sign an agreement without doing the math of seeing how fast you could pay it off? Or If the degree you got is so worthless it can't even pay for itself, that sounds like a problem you should take to the university, not a problem I should have to pay for.
And just a reminder: nurses and teachers are extremely important, essential jobs and the pay is dirt. If you ask me, anyone who can handle nursing school and then work as a nurse for 10 years should have their loans forgiven. The same for public school teachers. When a job is that important, that demanding, we should be bending over backwards to make sure we have enough qualified people to do the work and make it accessible so that anyone who is smart enough and can do the work can get the degree and do the job.
I’m a Mary. I started out at 69k and after 6 years it’s at 75k. They wanted over 1k in payment a month which I could not afford even having both of us working full time. Also, why is no one questioning all the loans forgiven for politicians? I’m sure that costs the country as well.
Mixed feelings on this and I can see the argument for both sides...problem I have with all this is nobody (those that make these decisions anyway) is talking about or trying to solve the root of the problem in the 1st place, why is the cost of higher education beyond high school so expensive that these non-friendly borrower loans are needed to begin with... #1 Tuition costs are completely out of control and unregulated, checks, balances, and cap ceilings need to be in place #2 Colleges and Universities are just as guilty as our government of frivolous spending, no discipline, no accountability, and no limits on their spending etc... #3 Not nearly enough of what these colleges and universities make in revenue goes towards academic scholarships. 4# Tuition rebates need to be awarded to college students who complete/graduate and maintain certain GPA levels to promote academic excellence and a way to ease the costs of higher education! I could go on as the list of what is wrong with the education system in this country is quite lengthy...especially higher education! Much like the Affordable Care Act (Obamacare) that is laughable, while it did make healthcare more widely available to many more people, but affordable is a joke...problem is it did absolutely nothing to reduce or curb the skyrocketing costs of healthcare, the reason basic needs such as healthcare became out of reach for so many to begin with! Different topic and different argument for another time. I'm just pointing out how many people, especially law makers in our government are reactive when they should be proactive and preventative before problems escalate beyond repair!
@@itzasweater9621 I'm not a US citizen and don't know much about your Adult Schools, but it seems to me you are making Universities analogous with technical schools. To my little knowledge there is a huge difference in curriculum, teaching, campus environment, student profiles between these two. My point was- quality education in USA is ridiculously expensive (especially in top universities) and it's possible to lower the burden on students. Say for instance, Germany has a GDP or 1/6th of USA but students in their universities have to pay literally €0 in tuition, even the international students as well. I don't see why US universities tuition cannot be lowered or subsidised. The very reason that students cannot repay student loans is the enormous tuition fees.
@@bikboto-zx6my US students end up having this huge debt burden precisely because they take loans for programs they can't afford. To eradicate a problem you need to understand the root cause of that. Until that happens students can look for scholarships to fund their degrees. You don't decapitate yourself just because you have a headache.
Honestly young adults shouldn't be allowed to get these loans, hopefully it would prevent these universities from increasing their prices. People get mad at the universities for increasing the price but there's nothing preventing them because every student is basically given a blank check.
Any time someone says a govt program is expensive or will cost a lot, I want an instant comparison to how much our military budget was increased this year, and our total military spending for the past 5 years. Or how much was spent on subsidies for oil corps. Or how much the top 10 companies received in tax exemptions. That should put things into proper perspective.
Nothing will stop the problem until loans are capped and universities can't keep raising the tuition. The tuition hikes have been like an arms race to build newer buildings and facilities so that universities have a "luxury" feel to them and obviously bureaucracy increases with new administrative roles to fit political ideology.
I hate the fact that people just assume people with student loans don't want to pay. We DO, but the current system makes it impossible to pay off on your own in some cases. I'm glad there seems to be a light at the end of this tunnel.
You fail to mention they taxes dues At forgiveness. IDR plan balances forgiven are treated as income and the tax bill is due in full that year. And that can be a big tax bill.
Based on Biden's relief plan (if it goes through), federal taxes do not have to be paid. However, if you live in mostly 7 states (Arkansas, California, Indiana, Minnesota, Mississippi, North Carolina, and Wisconsin.), you will have to pay state tax on the discharge. *So it depends. Tax rules change every year or quarterly so it is advisable you speak with a tax expert if you are in this scenario.*
Theoretically this could be qualified as a progress. But if we think about the money flow; before it goes, from bank to school, then from students pocket to the bank with interest. Now as per this reform, money goes from bank to school, then from students pocket + tax money to the bank with interest ( banks are not a charitable institution, they will get their money + profit back for sure). I’m sure this plan will help lot of students. But since tax money will be involved in this plan, why not simply making education system it-self more affordable? Only reason why genuinely affordable education system is not happening is because politicians want to keep the current meritocratic system? The efficiency is the core value in the current civilisation, so why not using the tax money efficiently to make the education system affordable?
I don't know your main message, but I believe politicians don't want to make College tuition-free because making College affordable would be one major step in reducing poverty.
Since very few jobs, that are well-paying, exist that are accessible without a college education, let alone a high school education that used to be a ticket to the middle class.
So will we need to sign up for this? Is it a new program starting in July? What about existing loan balances or is it only for new loans taken out? What if some of our student loans are private loans?
I'm on the lower or no intrest train. I know how much money I took out and made a decision for myself and if the government wanted all that money back I would be fine with being held too it... but younger me didn't understand or get set down by someone and carefully explained what interest was and that I would owe it. In a way I feel like this intrest and the push for my generation to go to college was slightly predatory on the government's part.
There certainly are a lot of palms getting greased in the higher education engine not just the government. In an opportunistic society we should not be surprised that many saw a MONEY GRAB and did what any good opportunist would do.
its sad looking back.....in college I mostly taught myself through reading textbooks and watching RUclips calculus tutorials. Its hard to learn much in an auditorium classroom of 400+, 1-2x a week. Yet, I still had to pay 30k for that piece of paper. Its honestly disgusting.
Considering they forgave the ppp loans there’s no reason not to forgive an amount of student loans. As much as people want to complain it’s not fair and personal responsibility they don’t complain when other benefits are provided that benefit them. Smh!
PPP loans were the result of COVID measures businesses wanted no part of. A student loan is something you willfully take out. Im not paying some deadbeat student's loans.
The same reason the tax code has more and more pages of "exceptions" for corporations added to it every year after lobbying. Did you honestly think the government cares about you? That's quite hilarious.
Our society encourages college educations so, yes, people will believe they need one to make a good living and they won't always be able to afford it upfront... they are doing what they think they need to do to succeed. Unfortunately, some colleges and universities have capitalized on this and charged exorbitant tuitions knowing that the government backs the loans. This isn't that much different from real estate developers who build homes in flood zones or sell homes to people who can't afford them, etc. They know that they will sell the loans right after they and the homeowners close the deals and they'll make off with all of the money and none of the responsibility. If there are major storms causing property damage/loss or any kind of mortgage loan crisis, the government will have to be the ones to step in.
Its Marys fault for not doing research about her degree. She chose to take a loan for a degree that won't cover her loan. Why shouldnt she be liable to pay?
A massive part of this problem is people get these loans having unrealistic expectations of earnings after college. I had classmate who genuinely believed they would make in excess of $100k/year in their first year out of school.
@Paula Olson okay what about the dozens of people I knew that refused to work and rented the nicest apartments in town? I worked at a zipline, made $15/hr plus tips and people would apply then refuse the job when finding out they'd have to work over spring break.
@@theonly9 so a few dozen people represent the majority of loan borrowers?? I went to a small liberal arts school and a large state university and most of the people I've encountered did work (including myself) during school and on breaks and all that money went to school. I lived in the dorms and definitely nothing extravagant. Idk who you were hanging around with but they aren't the typical student.
I went to a state school, graduated in 4 years and worked 3 jobs while I was in school still and will be in debt up to my eyeballs for the foreseeable future. My parents made "too much" for me to qualify for grants or income based scholarships, but not enough for them to cover the cost of college for my sister and I. Jobs don't pay out enough for people entering the work-force. & college degrees are pretty much a requirement at this point even for entry-level positions. The cost of living is ridiculous and more than half of my income every month goes towards my student debt. Not everyone can be a doctor or genius. They are slowly phasing out middle class, working Americans. The rich are really rich and the poor are really poor. I know not everyone agrees with student debt forgiveness, but something needs to be done. My generation of people work extremely hard (despite what many think) and we often feel like we get nowhere. There is a lot of frustration and feeling of hopelessness for us in our 20s. What's the point of working our youth away only to live paycheck to paycheck? Not hating on the elderly, but the difference between being poor in your 20s is we haven't had the time to save yet, so why do only the seniors get benefits and tax breaks? They were able to start a life without being in debt and build equity a lot easier than today's youth. I can't buy a home, rent an apartment, buy a car, have kids, my health insurance from my parents is up next month...We are just pleading for some kind of help. Even if they just continued no interest payments, that'd be helpful at this point.
I would like to know how deep we are into this income driven payment plan. It seems to be a well guarded secret until 20 years goes by and you realize you got reset at some point.
Go with the 10-year standard repayment plan. All these other government programs/solutions that they keep recreating are made to keep you in their pocket for longer.
The predatory servicers that offered you a forbearance time after time after time, knowing that every time you took one your 20-year forgiveness plan would reset. All those loans are still out there, and this new plan won't change that. All those peeps are still goofed over, they've paid in thousands, and their loan balance is still higher now then when they took out the loans.
@@nwatson2773 Biden was dishonest and corrupt in doing that. They knew it would not happen, but they only care about fooling the masses into voting for them. Sorry you were lied to.
I have a better idea. Student loans can be given if you go to a state school and it only pays for tuition and reasonable expenses. The best thing would be to go local and stay home. School is not for partying and getting the College Experience, it is to learn.
I had a loan servicer PHEAA or Fedloan I don't recall, who 12 years ago did everything in there power to withhold information, thwart, or lead me into a situation which would be to their advantage in making more money for themselves as servicer. My servicer did everything they could to prevent me from getting into a program to lower my payments. They must of been threatened with legal action because things got better all of a sudden. Today, all the things I need to do especially pay down my loan is made available over the website. No more scamming from Customer service agents.
A little over 50 years ago, someone could work full time over summer and earn enough to go to college for a full year. Now, even if you work full time, you cannot afford college. The equation changed, and the two biggest factors have either stagnated for decades (wages) or exploded in cost (college tuition going up several hundred percent in a few decades). This doesn't even factor in the exploding cost of books due to exploitive professors, blatant greed by publishers, and housing costs that have gone up 20x since the 1960s. Corporate/college profits are at all-time highs, while consumer costs keep going up with no end in sight (thanks greedflation). There needs to be new regulation on the blatant greed of these colleges, and the massive corporations that have a pseudo-monopoly over the education sector must be broken up like Bell/AT&T was. The control they have is insane. These companies are so focused on short term capital gains, they are actively dooming several generations of future Americans to never ending debt that ultimately causes more harm to the economy. The financial security of our country is at risk while we let fat cats gorge themselves with short term profits. You can also guarantee student loan companies are dead focused on destroying any forgiveness programs, and exploiting students as much as possible. The ironic part to me, is that most of the detractors to something that might actually help fix the college cost problem in the United States, benefitted from cheap tuition in the first place. And get this, they even passed laws so that senior citizens (themselves) can get free (or heavily discounted) college tuition. Absolute hypocrites.
crazy how they dont want to address underlying issue and keep issuing loans for useless programs which have no income potential, and the tax payer has to take on the burden. student loans should only be given to STEM and Medical courses.
The American economy runs on poverty, or at least the constant threat of it. Americans like their goods cheap and their services plentiful and the two of them, together, require a sprawling labor force willing to work tough jobs at crummy wages. On the right, the barest glimmer of worker power is treated as a policy emergency, and the whip of poverty, not the lure of higher wages, is the appropriate response.
1. "Free" colleges are not free. You will be paying for them for the rest of your life, regardless of whether you went to college or not. 2. Over-saturation of degrees, which will lead to higher and higher requirements for menial jobs 2. The vast majority of higher education does not benefit society in any way, shape, or form. Think gender studies, arts history, political science, etc... majors.
This overlooks the fact that forgiving student debt increases the individual's taxable income and would not cost the government as much as has been claimed.
I see it from both sides. Yes I have student loans (waiting on Biden Bucks to be debt free and have paid over $40k back) Crazy how you initiate a loan and accept terms. Crazy that a degree is not worth it anymore. Crazy that income driven repayment is an option (I just learned that from this video) Crazy college parties, hangovers & memories…priceless The only way for college prices to come down is for the education of millions of high schoolers and advisors to show them that it’s likely not worth it anymore. Which in turn should lower admissions. Of course the Department of Education and lobbyists would take that well.
The real question is how Mary managed to get a loan when her job perspective was so poor. The real solution is that certain college major shouldn’t be eligible to student loans.
Seems fairly obvious the Student Loan Program need updating. Also when applying the salaries of students once they graduate should be considered when approving the loans. Colleges also need to be guaranteeing 35% of the loan debt. Everyone need to absorb some of the risk. Options must also be available.. Two years military or another service for every year of college if debt defaulted or after graduation.. Need to drastically reduce the number of Liberal Arts Degrees funded..
How about colleges foot the cost of education and make loans with a %salary payback program. This will align their interests with the interest of the graduate to get a good paying job. Instead they are pumping students for money and subsidizing the good students for statistics and the football and basketball athletes for ticket and broadcast sales.
It cracks me up that the boomer generation built a society that works FOR them, but young people today can't do the same. They had corp taxes higher than 50% during various years. We built the national highway system, put a man on the moon, and diverted funds to help people in need with various programs. We built the middle class and people had the highest purchasing power ever during the 60s. Lots of them even went to college for free or low-cost amounts. The purchasing power they enjoyed allowed people to go to college, secure housing, transportation, and other necessities for the salary of a part time job. But now that they're old and losing control, they won't allow that change in power/control to go to the younger generations, so they can mold society to benefit them. It's the most egregious thing I've ever seen. The college system has turned into loan sharking. Education is vital to building our society but it's running rampant with uncontrolled costs, bloat, and fraud. It's time to reign it in.
It would be so nice if the DoE actually looked into why Universities are growing tuition costs at 50% per year and giving their leadership staff million dollar salaries to never show up and do any work. Lets also address why education costs too much as well.
Universities charge more and more because it’s almost guaranteed that students will take out loans. Especially since most people in the US can’t finance their education out of pocket. So the only reason prices increase is because students continue to enroll. No matter what they decide to major in. And we already know all degrees ARE NOT created equal.
@@ajh.4131 Its almost as if the rich people want to block anyone else trying to get an education, thus compete with their kids?
College increases tuition, kids take out more loans, government gives them more loans, and College tuition increases because the government keeps giving out loans to kids who have no idea what they're getting into. Now we have the government trying to fix what they started
@@bmo61950 You are missing... who is profiting from this? School administration and fund managers
@Erik Anders Tuition cost will keep increasing if the government can't stop handing out loans that they know people can't pay back. The government is in bed with major college institutions.
The sad thing is, most people are taking out these loans that could effect them for decades, at only 17-18 years of age.
You’re an adult at 18.
@@FinancialClout but can't drink??
@@ashleym6765 Yea, to keep high school seniors from buying alcohol for 14 year olds
@@FinancialClout Your brain isn't even fully functional until you're 24.
Predatory lending
What sucks is you have a ton of students who did everything "right." They went to community college and then to a local public university and majored in something that would get them a decent-paying job yet they still ended up with insane amounts of debt that is impossible to keep up with due to the interest rates and high cost of living.
Obviously they didn't do everything thing right now did they
@@tslonaker4609 Nothing is inherently right but it doesn't mean that it has to be made worse for it to be "right" according to the standard that you may be thinking of. lol
@Mrbambinovideos The "right" way may be subjective but I think we all could agree taking on loads of debt to get a "high paying job" that won't even pay off said debt off is not "right" way.
@@tslonaker4609 In that regard, most would agree, assuming people are well-informed. Unfortunately, this is just how most would fall for within the framework of a capitalist society. There will be people who have to lose, not everyone can or should win for those "high-paying" jobs via an investment of a college degree. Nevertheless, it's muddled in with many factors that can sometimes be made worse by decisions that seem right.
@tslonaker4609 do you actually not know what op meant? Or are you just being pedantic to be purposely annoying?
Let us please note that Student Debt is the only debt that cannot be erased due to bankruptcy. All other forms of debt can be forgiven by law. People can go to a casino and amount an enormous amount of debt & they can declare bankruptcy at some point but student debt cannot forgiven. The majority percent of the people that have student debt want to repay it but the current state of corporate America & bank financing makes if very difficult for people to gain employment that pays enough to make regular repayment possible.
Funnily enough, Biden was one of the few Democratic senators who voted with republicans back when they chose to make student loan debt permanent. Now his own administration is having to figure out how to fix the ramifications of that vote. Because it had huge ramifications. College prices went up so much because the schools knew that students would be forced to repay the loans no matter what.
Yeah and ironically Biden is now cleaning up mess he contributed to in the senate by approving that terrible law!
Because the enormous amount of debt people can gamble away is granted by a private firm, a bank. Not taxpayer dollars. And for those who point at the 08 bailouts as taxpayer dollars into private banks, yes that was a terrible thing a democrat, Obama, did.
@@toomuchpassion2361 Technically the amendment that you are referring to was added to the bill at the last second & there is actually a recent documentary trying to determine who actually added it. So there are many people that voted for that bill that were completely unaware that the paragraph was added.
@@nicktaylor1003 didn’t we just bail everyone out again in 2020 under trump? There were the ppe loans for business and the airline bailouts. Is that not taxpayer dollars into the private sector?
Make schools accountable. Let them issue the loans, not the government. Then they might care about who they admit, what is required for a degree, how much it costs, and if their students find adequate employment.
My college can F all the way off the way they send me monthly emails asking for donations. Donations for what? The president's office remodel?
Because that wouldn't be abused at all
@@thekingoflordagames3517 like they are abusing us now with our own taxpayer funding? Is that the kind of abuse you are talking about?
@@joshhoward1289 yup, the current system sucks, but your system would probably also suck.
@@thekingoflordagames3517 That’s really insightful. I hope you didn’t pay for your education.
In other words, the payment based plan method was never a good idea to begin with and shows extreme financial irresponsibility on the government’s part for creating a bad system
What the video failed to add is that income based repayment will grow as your income grows. Mary had a payment of $67 year 1 by the end of the loan her payment would be $500 to pay down all the accumulated interest. It is a terrible problem however, as it assumes wage growth through time.
Let's not forget the people who decided also to be a part of that system by robbing their own energy through interest by getting into a debt for a useless degree. Gotta take responsibility here too pal.
Yeah nationalizing the schools and making college free is really the proper option
I must have missed the part where the Federal Government has implemented the income tax forgiveness program. Locally, my town has yet to implement a property tax
forgiveness program. Maybe we could simply stop issuing student loans PERIOD. THAT, would fix the (future) student student debt problem.
@@AngelE666 absolutely not. Name one thing govt involvement helped. Schools
are so expensive now because of government backed loans. They caused the problem. Schools need to be held accountable, not subsidized.
I think they should just make student loans interest free. That would subsidize education essentially but be favorable towards everyone’s income limitations w/o feeling like a penalty.
YES!!!!!!! The compound interest accrues the minute you sign the loans. You already owe more than you borrowed as soon as you graduate. The interest is killing us, not the loans themselves.
@@extra_ice_girl yes and a lot of the other alternatives would be much more of an uphill battle. Like universities aren’t going to like the government dictating how much they can charge… and sl forgiveness is really a bandaid because it doesn’t address future sl borrowers and is costly.
Or lower the interest amount by a ton...that's fairer
That's just like giving billions of taxpayer dollars to useless activities of universities like facilities/administrators/social, very little of which goes to academic research. What should happen is a cap on federally-backed student loans which would reign in university tuition.
@@joshitheyoshi2533 the only issue with capping sl borrower amounts is some programs cost way more than others. Like becoming a doctor, lawyer etc is costly and that would then leave some professions to only advantaged students. I know me personally, my licensure requires five years instead of four…. They could totally cap undergraduate borrower rates lower though but again, some low income students need higher amounts to cover housing/food. It gets really tricky😓
I don’t think any policy regarding student loan is effective unless you address the underlying issue that is rising tuition costs. But what do I know? 🤷♂️
It's crazy, the same professors crying for socialist policies in the US, are moving to the universities that pay the most. Are they willing to take pay cuts? Probably not, and would seek other employment if their current university successfully implemented such salary and benefit cuts.
Universities need to cancel useless courses like gender studies and LGBTQwhatever! Useless liberal arts and basket weaving!
@user-dx2kw1mf8e yes. Glad to see that somebody gets it. Stop asking who is going to pay for it and start asking why the cost is so high.
The problem is that it's not easy for the government to control costs of a product especially if it's a private university.
@@aquaneon8012 the loans are backed by the government in the event of student default. This gives 18 year olds far more credit than the free market would ever do. So then universities raise their tuition because there is so much money available
Start with university endowments. They wanna act and profit like pay day lenders treat them like payday lenders.
I think college endowments is something like 700 billion dollars a year. They could pay off the student loans themselves.
This comment is a sermon and a half. Preach on! I was absolutely floored when I found out what endowments are, how they operate, and how much money some of these schools literally have just stacked up doing nothing for the students. It should be illegal for them to do that and still increase tuition.
The university education itself is predatory, not the banks or firms offering refinancing options
Large amounts of that money are from research grants brought in by scientists that admin steals away to line their own pockets.
I’m a student loan borrower, but my debt is manageable -- regardless if the 10-20k is knocked off. Still, I feel amortization is absolutely insane. I didn’t even know what that was at the age of 18 when I first started taking out the loans and most kids probably don’t. Financial literacy is so necessary and should be mandatory in our schools- smh
If you didn’t understand how it works, why did you sign the pages?
@@Phat737 Most people are told you have to college to have a good life. No other country traps their youth in cycle of debt for the crime of building job skills..
If you think it’s the students fault the propaganda worked on you son
@@thatgreenstuff Absolutely! You worded this perfectly.
It didn't always matter if you understood amortization if you were poor enough and high achieving, they often counselled you to go in a fiery manner. It was your best chance and safer to go, supposedly
@@thatgreenstuff Well when you wanna specialize in certain fields and/or have an easier path to 100k a year then absolutely yes is college necessary. The problem is also more and more jobs requiring degrees.
And what really needs to he added to this plan is that we should not be charged daily interest while we’re full-time enrolled in school. That in itself puts you 4-6yrs into interest rates just by being in school.
yes, I just posted about this. That is the biggest crock out there. My wife had over $20K in loan interest the day she graduated from med school on top of over $100K in principle on the loan. Then you can only deduct $2,500 per year of loan interest from your taxable income. The system gets you in debt quick and doesn't properly incentivize you paying it off as soon as you can. In the end my wife and I just said screw it and paid it all off as soon as possible. The only loan we have is our house on a fixed rate 3% mortgage. No education loans, car loans, cc debt, etc..
Taking a loan out that can't be paid off by the monthly payments seems illegal.
Absolutely.
It's extortion, the federal government is a pro at it.
it's not illegal. that's how loans work ...loan issuers want you in debt longer than you should. so they keep making money off of you. "monthly payments" is the name of the loan game.
"monthly payments" are not doing you a favor ...it is a trap to get more $$$ out of you. I got out of debt fast because I never paid just the minimum.
Except you're never going to know what can or can't be paid off monthly if you issue the loan before the borrow knows what their income is, which is fundamentally what happens whenever you issue student loans.
My question is, it feels like this is only for Government loans. Most students I know also have "Private loans" from predatory companies like Naviet and Sallie Mae. When is there going to be some real systemic change to how we approach educating our population, regardless of income, ensuring we have a population ready to do the work of the future, and become contributing citizens (and consumers because thats what we really care about) without being saddled with oppressive debt? America is getting education very wrong, and it shows. It's so disappointing.
Dude if you cannot afford college don't go. Simple as that, there are a plethora of options that will make you as successful if you work hard. But I'm sure entitled lsoers are incapable of hard work anyways thats why they go this route
Why? Did they exhaust the amount they could take out using Federal loans? Did they enjoy that really expensive 4 year study-cation with parties, a climbing wall, and a lazy river? Did they work part time during the year and summers? Hopefully they didn't take out Doctor or good Lawyer loans for a 50k/year job.
@@JacobAnawalt Really being prejudice there assuming every college student just parties hard. More students are actually studying and doing their work. Many working part time jobs during breaks if not during the year. You can't afford to spend your years partying when you can barely afford it even when working your tail off.
@@JacobAnawalt As a college student I had a take out a loan TO MOVE AND HAVE A PLACE. Because rent gone up a lot and wanted to live with my husband while going to college.
My husband took out a private loan because he COULDN’T originally get a government one. Just to pay for classes and he didn’t know how too until I showed him how. Why would you assume the worst in people needing a student loan?
Both of us are working part time and every student we met also working.
Navient, Nelnet, and Student Loan Marketing Association (Sallie Mae), are Loan servicers. They are businesses that profit off the fact that you have to send in a payment every month. You are also supporting them, as well as paying off your student loan. Not only are you gaining a degree to show how smart, disciplined and hard-working you are (academically) to potential employers, but you have graduated into the world of supporting these loan servicers, as well. Bet you didn't know that.
I don’t want to hear anyone from the generation that went to college for free, or close to free, talk about student loans. Period 😂
PERIOD. Or better yet get a job with a high school diploma that now requires a Bachelor degree
1
I got mine for free because I work to pay for tuition and apply for scholarships!
@@djtwister6997lucky, I applied and got denied and I made the grades and I worked while in college and high school. Competition sucks.
@@Dr.ghostbuster yes it does, some of us get lucky and others don’t unfortunately
I don’t know how but you’ve managed to package an unbiased analysis that is more entertaining than the sensationalized segment of economic and financial news. Thank you for your efforts to be the signal and not the noise. I understand that the economy is in currently in a downturn and that we must wait for the stock market to recover in order to break even and make a profit.
@Lloyd Bernard Exactly why i enjoy my day to day market decisions being guided by a portfolio-coach, seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not outperform, been using a portfolio-coach for over 2years+ and I've netted over $800k.
@Lloyd Bernard KAITLIN ROSE STERNBERG. She's a reputable tutor who showed me that profits can be produced in both bull and downturn markets. She talks about investing, insurance, making sure your retirement is well-funded, and searching for methods to create a volatility buffer for investment risk, among other topics.
Screw profits and the stock market. Capitalism sucks.
I felt like it had a Liberal bias. They should have people who criticize it and support it.
What downturn? The economy is strong, as evidenced by the jobs reports.
Helpful tip, pay weekly instead of monthly. So if your student loan is $400 monthly, pay weekly about $95 every Friday or so. That’s what I did especially if your income fluctuates a bit. You don’t get a big surprise at the end of the month, and it keeps you consistent. I paid off all my student loans and I definitely wasn’t making a lot of money some years, but now I’m in a much better situation.
Also don't fall for the scams that all the alternative loan programs are. Don't consolidate, don't take the 20 or 30 year plan, don't take the income based, don't take a long forbearance. Most people I know that have problems were because they were promised a deal with lower payments now and didn't look at the long term costs. It sucks but the best thing you can do is accept current struggle. It will get better as you get use to working in your means and get raises. Just don't sell off your future.
@@barongerhardt There were companies like Navient that pushed these programs on unsuspecting students and really stuck it to them during the Pandemic.
@@amexsucks3015 These programs have been around much longer than that. The programs aren't inherently bad, for the most part, but they are dangerous tools. In many cases it is someone has a problem, got an ax stuck in a log. They tell the boss the logs are too strong for the ax. So they get handed a chain saw and try to dig out the ax.
@@barongerhardt The way some companies like Navient spread lies and conceal the truth was truly shameful. No wonder there were so many lawsuits against them. The fraud in the student loan industry is staggering.
@@amexsucks3015 Now Navient is no longer doing business
What a disgusting education system.
We also have corporal punishment in schools in 15 states and 48 states private
Its not much better in the UK unfortunately, graduates end up with just short of £50,000 ($60,000) and they have to keep paying an amount depending on their income until the balance (with interest between 9% to 12%, much higher than US student loans) is paid off or 30 years at which point the loan is forgiven. Not only are you going to get a lower salary than what they have in the US, you're also going to be paying the loan off for 10 more years.
@@Addlibs i thought UK had free college.
@@scifirealism5943 Most Scandinavian countries have universal tuition. In fact Iceland only cost $750 for international students when they register for a semester. Citizens get in for free.
@@NotAHomelessGamer that makes me cry as well.
College is not only not free here but it's completely unaffordable for someone making minimum wage.
$750 a semester? My Community College costs $5,000 a semester.
When I did university in Australia my loan was interest free and only started income deduction payback after I reached a certain salary. If I never earned enough to pay it back, the loan never needs to be paid without consequence.
That makes me cry.
This would be 100x better than the current method
@Tony Mirabal don't worry I also went to uni in the states so paid my loans for that too.
Yeah, someone still paid for that.
@@benw4401 probably foreign students. Here in the UK we have a max cap on how much universities are allowed to charge Brits, but they subsidize that cost by charging international students more. The cost varies but some people I went to university with were paying 4x more than I was because they didn't have British citizenship, and that meant there were no laws surrounding how much they were allowed to be charged.
Glad to hear that I am above average. Please pass this on to my 10th grade biology teacher
What they should have done is just limited the interest rates on the federally backed loans. I went in thinking the rates were 2% because that what they'd been. When I signed up for grad school loans, turns out they were 8-10%. And the first 10 years out of school were rough. So despite paying $300k over the past 10 years on an original $490k in debt, I ended up over $700k when COVID hit. We've been blessed and have got it back down to $650k. But we'll have to rely on the IBR forgiveness but even if we get that, there's a tax bill on what's "forgiven". So 25 years after graduation I'll owe the IRS about the same amount I owed the school originally, AFTER paying hundreds of thousands on it the whole time AFTER taxes. I have to earn an extra $80k a year to pay $50k on my loans. Getting screwed big time.
Three solutions:
1. Drop the interest rates
2. Student loan payments aren't taxed
3. Kill the tax bill for the forgiveness
(And hold the schools accountable for all the defaults!!! Stop guaranteeing the loans to the schools, the cost of my education more than doubled between the time I started working on it and actually getting in, because, why not?)
You collected 490k in student loan principal? How is that possible, even with grad school?
This seems absolutely insane to me. What education is worth half a million dollars?? I graduated with 13k in debt after putting all the money I made from 3 internships into it before I graduated. I came out with an engineering degree as well, so ya know something actually useful despite the lower end cost.
@@BrianGivensYtube Dentistry. Programs run 3-400k these days, and living expenses for four years, married with kids through it all
@@MattMcConaha Dental schools are $3-400k, and then living expenses for four years.
@@BrianGivensYtube I started off doing civil engineering. Almost no debt from undergrad.
It’s amazing how they’ll approve $886,000,000 for the military budget and fight this endlessly.
This is something people have been sleeping on. The obvious headline is the 10k in debt forgiveness but the income based plan is so so much more important for many borrowers and for borrowers going forward. I actually hope this continues to be ignored otherwise who knows when Republicans will start suing over this as well.
As a taxpayer being forced to subsidize others for their poor decisions, I would support any suit over this.
People make bad decisions on the roads, should we stop subsiding those? Tax payer money will never spent with 100% satisfaction. Stop making it seem like helping out millions of people with little to no effect to your finances is a bad thing.
@@ron88303YESS!! Use my tax dollars to train the jarheads and to build hundreds of fighter jets that get “lost”. The price of 10 of those jets is enough to get every persons student loans fully forgiven lol.
This is the best explanation of amortization that I have ever seen! Thank you.
How do they not teach this is high school?
@@joshhoward1289 high school is not meant to teach us real life application...only book knowledge
@@joshhoward1289 It is taught in high school. Most states (if not all) require one semester of it under the names like: personal economics, personal financial literacy, or consumer education. You are also required to go to a several hour course that teaches about just student loans and how interest and other terms work prior to getting a federally backed loan. The problems is people don't pay attention.
Mortgages should be amortized, since they are a big chunk of money, you should be able to pay it off in 30 years. A student loan should be a simple interest (not revolving) loan, the same P&I every month, no matter what. No one should be stuck with a student loan for 30 years.
@@andrewvillarreal26 High schools are having enough trouble teaching basic writing and math skills, judging by the continually declining test scores.
It may have already been mentioned here in the comments but it also needs to be taken into consideration that most graduates are unable to find work in their field of studies for many years if at all once they graduate. ( As a last resort, as a mother) I ended up in Bankruptcy tying to pay for my son's education so he would have as little debt as possible afterwards. I figured 7 years on my credit was better than decades of student loan payments for him. The wole thing is FAR REACHING And extremely sad.
actually... that's smart. I wish i could declare bankruptcy on my student loans. but you speak the truth. I didn't expect to get out of college... and not find a job that paid well. I ended up having to start my own company because i couldn't find any job that would pay a decent wage. i regret my college degree and wish i could just return it
2:40 - Who takes out a loan that would take an infinite time to pay off unless you make additional payments such that the regular payments would begin paying down principal? It's basically an infinite ballooning loan if you only made the regular payments.
It’s weird how people talk about all the profits thy made by crypto trading, while I’m here with huge losses please can someone at least advice me on what strategy to follow?
As a newbie about to invest or new to the investment you must have these three things in mind
1:having a long term mindset.
2: Be willing to take risks
3: Have a trusted expert broker
Thank so much for the advice do you recommend any professional broker?
@@engelstody7171 Ohh yes I highly recommend trading and investing with expert valerie yarvin
Thanks for the suggestion how do I reach out to her please?
I am so glad this is being changed! It wasn't this way back in the 80s when I got loans. Somewhere along the line, student loans became a business, focused on profit. It's supposed to be a non-profit enterprise.
You got it backwards. Easy loans got backed by the government and schools became about maximizing their take.
Let's see...I owe $176,000 for a degree that cost me $57,000. I'll die in debt to the government due to their predatory loan practices that have not changed until now. Thank God there are changes in place to help future generations of students.
That is stupid in your part. Why did borrow that much? Work and pay for school like an responsible people.
Hopefully this plan will help you!
That’s why people should avoid student loans. Don’t take them out in the first place they are predatory in nature.
@@jeffreyburney6161 god forbid low income folks have access to higher education
@@jeffreyburney6161 when you're 18 and signing up for school, do you understand and kind of loan/monetary system? How many kids get in trouble with credit cards they sign up for in the Union?
Yup. When I graduated with a $35k loan in 2006 and started my career in 2007, my earning potential was only about $30k/yr even though I was working in STEM, and I had to support a family of 3 by myself on that income. Even in 2015 my earning potential was still only $45k, but only if I worked for the employer who didn't require a Master's Degree for the job title I got. My loan balance only started going down once the pandemic paused interest. For the first time in my life, it finally dipped just below $30k this year. If the Biden forgiveness program doesn't go through, it's likely to go right back up once payments resume. I'm 46 years old. I'm going to be stuck in this for the rest of my life.
Thank you for posting this. I want to work in stem and thought of taking out more debt for my bachelor but I will wing it with my associates degree.
@@missdesireindependance5194 depending on what field you want to go into, you honestly might be better off just winging it.
@@ajh.4131anything STEM is extremely valuable. Most places will not bother without that 4 year degree. Stem is worth it. I swap jobs every 2 years. I've quickly moved up and been in many leadership discussions where without that degree they won't bother. I'm 28, earn $112k+, and hardly work 30hrs/week.
@@missdesireindependance5194 It is an opportunity question. If the associate gets you the job/field you want, it is half the cost of a bachelor. Looking to the future, if the lack of a bachelor is going to be an impediment to the position you want you need to ask the likelihood of getting that position. If it is high and the burden of more debt now is manageable on your current expected first jobs pay, then it might be worth suffering now. Otherwise, you can always go back to school when the need/benefit is clear. In many cases you can even get it paid for.
Same, once the Covid pause started I was able to pay off a few loans making payments and using those pandemic checks. But first I had to pay off the interest that had built up that I had no idea about.
A better solution is to just reduce the interest rates on student loans instead of forgiving them. Make all student loans a 1-2% interest rates. That's more helpful and fair than forgiving the debt.
Not exactly, because you would still have plenty of people (more than 60% of those who have applied for Biden's forgiveness plan) who have already paid their principal plus x% in interest alone and still owe ridiculous amounts. It would help for future borrowers but doesn't do much for current ones. Either way you cut it, forgiveness is the only thing that will pull them out of it right now.
@JMulvy Call it what it is. It's a debt transfer. The government can't pay to pay off loans. It's going straight to the national debt
@@bmo61950 so again, if government spending is your concern you are fighting the wrong program.
@@JimMulvaney this program is one of the many problems.
@@bmo61950 and the only practical solution borrowers have right now because paying it back isn't working due to predatory lending practices and fraud.
Borrowers have been screaming about the predatory interest rates for years. No matter how much we pay the balance doesnt go down and we've always been told its our fault for going to college.
I'm very happy this change has been made but its taken far too long.
What this shows is that we don't need loan forgiveness. What we really need is an interest-free student loan.
But even when we ask for that, boomers and the generation after them cry and scream to keep things the way they are.
That was the original Johnson law
This is just fixing the wrong side of the problem. Instead of just throwing tax dollars at college and pay them whatever cost they ask for, why do we not question and reduce the cost? Also so much of the costs is based on choice. You could go to community college for 2 years, then transfer to a state school and get a 4 year degree for 50k, lets say. But if you opt to go to a "fancy" and "prestigious" ivy league school that same degree could cost double, if not more. So why should the tax-payer be on the hook because of your personal decisions.
I think our efforts and resources should be to reduce the cost of college, making it more affordable, instead of trying to figure out how to pay the outlandish costs that the college says you owe.
Books for one, is an absolute joke. Instead of just printing a book and using it, and allowing students to trade or use pre-owned books. The colleges and publishers basically scheme and recreate the same book year after year, forcing students to buy the latest edition, simply to undermine the possibility of students saving a buck. This would save students probably 500 dollars per semester easily if not more. Simple.
Why is it that some schools charge each student 50k a semester, yet their teachers are making 30k a year? Some of these schools get endowments and donations in the tune of millions of dollars a year yet their operating costs are still so high? What other ways can we reduce costs? Maybe we should take this loan forgiveness money and create cheaper at costs colleges. Maybe take that money and create a fund for interest free loans. Either way all we are doing under Biden is giving colleges whatever they ask, without question, and allow the costs of the degree itself to run rampant. Government and colleges are in bed together, and they are just paying themselves. We need to be smarter than this...
I don't think the *average* Mary is going to Ivy league (and frankly, if they did, I thought they wouldn't even be in this situation)
Because they are all leftist institutions that must be supported at all costs by liberals.
wait till you look at homes. :)
@@1jamesreed I just got one last August, I know how it is...I dont have any student debt tho =)
Takeaway: Dont go with an income based repayment plan even though it is temtping with low payments. This also applies to other loans such as car loans. I was considering the same income based repayment plan when i graduated but went with the 10-year payment since I realized that the small payments wont cover the interest.
It operates the same as a minimum monthly payment on a credit card - sure you could just pay $25 but if you have a large balance still on your credit card they'll charge you more due to the %APR
You should ABSOLUTELY go with IBR... you make small payments for 20 years then rest is forgiven. IBR plans are the best plans to actually end up paying the least for your loans. ANDDDD while you are making your very small payments, guess what you can do with the money you are saving? invest it. even high yield savings accounts are paying 5+%.
so i pay my 200$ or whatever, take whatever I have left as disposable into high yield savings, collect 5% interest while my loans get closer and closer to be zeroed.
and before anyone says anything about "but what if you miss a payment!?" or "but what if they mess something up and it says you missed a payment!?" if you miss a payment, that's on you. that's called not being respoonsible and you will learn this lesson fast with loans or credit cards if you havent yet. and then its called annual (at least) check ins. "hello ___student loan servicing company___, my name is ___, my identifying info is __(social security number and birth date)__. I was calling to request an update on the status of my loans in terms of my progress towards forgiveness and payment history. I would like a copy of your available payment history sent to my email for my records."
BAM! now I have written proof from the loan servicers every year. anyone actually paying their loans off using 10 year or whatever plans is sacrificing their financial future investments and isn't savvy.
Universities are the ones that should be on the hook for any unpaid loans. They choose the students, they set the tuition, and they can make payments if their services aren't good enough for the students to pay it back.
Problem all started when the government started promising blank checks to these colleges by going “yeah sure! Charge them as much as you want! We’ll grant a $120,000 loan to an 18 year old! What could possibly go wrong?”
These WSJ Explains videos are great. Hope they continue.
This happened to me, plus add in not affording the loan amount, not getting the high paying job after college, puttng loans in deferrement or forbearance, not extra paying toward principal...I've paid my loan and still owe 20years later!
Definitely need financial advising to make sure youre doing what's right for you and the loan
student loans is given a grace
@@angelachanelhuang1651 what do you mean?
How can you spend $30k on student loan, get a 4 year degree and only make $30k/year for 10-20 years? Should we shift our focus to the quality of the college program that Mary spent the $30k on?
Fair - there’s still a need for counselors, advisors, teachers who in certain parts make near that amount. One way or another, adjustments need to be made
I had a science degree and only was able to land a 30k salary job out of college. Unfortunately, my job was in a destination area so rents were very pricey despite having a roommate.
That's because employers are using it to vet who they will even take for a job any person with a high school diploma could do.
I work in financial industry while my wife in education. We both have master degrees. Let’s just say I feel really bad when I see my wife’s salary
Did your income rise over time?
What alot of people DON’T consider is student loans are taken out by kids to further their career and education. The amortization schedule is soo crazy and a lot of people don’t realize that is apart of the plan when they are paying it back. It feels so discouraging making payments for years for none of it to actually be going towards the debt. I am now in my 30s. Have consistently made payments for my debt to not have gone down AT ALL.
I paid down 35,000. Defaulted. Went to get back on board and it looked like I hadnt paid a cent. That's when I gave up. In retirement they had garnished my Social Security check. It will probably be restarting again. That will be docked for the rest of my life, I guess.
A true amortization schedule would have you paying down the loans over an agreed loan repayment timeline, typically 10 years. The problem is when people apply and receive a reduced payment schedule, especially one that doesn’t even cover the interest. This puts you in a death spiral as your payments aren’t even covering the accrued interest.
People taking these reduced payment plans need to understand this. It is a temp solution, not a good fix at all.
@@teresatrigiani7838 So, $35k. For a degree in what? Something that would generate an income stream to repay your loan? It looks like no.
@@joshhoward1289 In other words, people need to be smarter when they take out these loans.
This is great, and I wish so much that this was around when I took a low salary job and was financially pinned down for a few years by unfortunate life events. The pandemic pause helped me catch up on over $20k of “capitalized interest” that got tacked on to my balance because of this mechanism. And the worst part is, no one walks you through the mechanism of the interest accrual and capitalization, so you have to find out about it by comparing your new balance to your old balance and seeing the thousands of dollars you paid that year and not understand why things don’t add up. Truly insidious. Instead of forgiveness, I would loooove to get credit for all of my payments that got eaten up by high interest rates and capitalization.
The blanket approach of approved student loans for any study regardless of cost is a system that is destined to fail. There should be a cost to risk analysis based on career, job placement, potential money earn and school analysis all prior to issuing a loan to a clueless 18 year old.
America has some of the best universities in the world. MIT, Harvard, etc. You could easily do what the UK does and give low interest study loans to any citizen that wants it but then charge international students 4x as much for the prestige of studying in America to cover the cost. That makes it easy to spot and poach foreign talent too if one of the international students happens to be a gifted engineer / chemist / whatever the economy currently needs.
Colleges and universities are not educational institutions, they are businesses that recruits investors 😂😂😂. How did I wake up with two degrees, certified and license and live in poverty 😂😂😂 it's a good thing humor is my medicine.
@@bobdeengineer7396 You name is Bob the Engineer. Just get a job at Raytheon. They hire anyone with an engineering degree and no one without one.
@0v3r cl0ck3d charging internationals 4x means more internationals go elsewhere. Prestigious schools have value bc of their student body, not bc of their curriculum. Anyone can have that same curriculum at flagship state.
This^^^ Part of getting a loan should be a discussion of the degree and the chance of repaying it. Departments should publish not only graduation, but employment and average salary information for their graduates.
The other part most people miss is what happens to the credit of people on an income based plan. Their credit utilization rates increase, as it effectively shows them over their limit. This hurts their credit scores and costs them money elsewhere. It’s not supposed to happen, but the scoring algorithms count it the same as any other debt.
It does not increase credit utilization. Rather it is treated as a fixed loan and on time payments (regardless if is $0) gets reported. It does however impact your debt to income ratio but only to what the minimum payment would be.
DTI is the only thing a student loan affects.
This isn't true as someone else mentioned it has no effect on credit utilization rate. It works just like any other student loan as it's not a revolving credit line like a credit card.
Ya, not true.
@@mquintannj spot on!
Shift the focus from balance to interest rate limiting…..this is one of the only aspects that will get bipartisan support when it comes to student loan legislation
Wow, this made so much sense to me. I’m Mary. I borrowed $16,000 in 2001 and today I owe about $30,000. I’ve paid off two $30,000 car loans in this same time frame. I couldn’t understand why I owe more then I borrowed for my student loans. Thanks.
hello i could help you with your debt problem
This is fine for now, what about the wage suppression and absurd university tuition costs that are at the root of these issues?
The first could be solved with a minimum-wage hike.
Second problem could be solved with the restrictions of financial aid given to colleges.
Colleges have to meet certain requirements in order to receive funding from the federal government and also to provide funding to students.
One of the requirements could be for universities to charge tuition that's a narrow band around the median price or that's within the price range of lower-income students.
What about acknowledging university should have never been pushed as something EVERYONE should go to? Only people who can PAY FOR IT should go and only people who are actually going for an education not to PARTY.
@@trapaneezus with what the cost of college is now only rich people could go.
this would further stratify Society.
@@scifirealism5943 GOOD. Let all the rich weirdos have their little clubs back.
@@trapaneezus In 2021, full-time workers ages 22 to 27 who held a bachelor’s degree, but no further education, made a median annual wage of $52,000, compared with $30,000 for full-time workers of the same age with a high school diploma and no degree, according to data from the Bureau of Labor Statistics. Higher paying jobs usually have college requirements, even for jobs where there's no need for formal education employers opt for candidates with GED.
Maybe we shouldn’t loan money to people who are going to average 30k salary (or wherever the average salary is if it is insufficient) after college? I mean, if they can’t pay even the interest, what business do they have even getting the loan in the first place. Not everyone needs to go to college.
Because you can of course perfectly forecast how much someone is going to make after college.
@@thekingoflordagames3517 yeah, let’s ignore any statistics and take 100k in student loans to get a general studies degree from Cornell. I’m sure they can pay it back
@@moderatelyapathetic3280 Not all cases are that clear cut, so where would you put the cutoff line, and how would you calculate that?
@@thekingoflordagames3517Was that a serious response??? You can’t figure out how to simply Google a job and get its low, high and average salary. Are you kidding???
No one knows how much they will make. Some people start off with a lower paying job to get experience and then their salary increase over time.
When i first graduated college, so many people told me to do the income based repayment. It was clear to me that it was scam even then. I paid off my loans in 3 years not 10.
Way to go!
The only reason I don't currently owe more than I took out is because of the payment moratorium which is ending soon. I did everything right, but because I fell ill, but not ill enough for disability, I'm still on the hook despite generally having little income. I'd refinance my private loans, but my income's not high enough to do that either.
3 things need to happen
1) Granting of loans to be under the same scrutiny as home or business loan
2) Students making better informed career decisions
3) Allow student loan forgiveness on an income basis.
I agree with this, with a slight addition to #3: Must complete the program. Otherwise anyone can take out a lone and start school, quit halfway, and then taxpayers get stuck paying for their loan forgiveness.
@@callmedeejay Did you drop out before they taught you how to spell loan?
1 and 2, not 3. You borrowed the money, you pay it back. Who else is going to pay it?
3- The programs are already income-based, incl the proposed forgiveness.
1- Students have no credit history, and no collateral, so no bank would extend a loan without a guarantor. That could be parents, but then only kids from wealthy/upper-class families could ever go to college.
2- Figure the average person has a 45yr+ working lifespan - do *you* have a crystal ball that tells you what skills, credentials, and experience will be needed throughout that time? If so, feel free to share or sell it 🙃
About the 2# they are 16!!
They should cancel the interest not forgive the loan itself
What would be the incentive of the loan provider. Interest is the charge the lender receives for foregoing current consumption.
Why then would loan provider should give out loan ? What's his/her benefit?
@@Robis9267 exactly
@@otimjoshua3366 @Otim Joshua the government is the loan provider right? They are the ones providing public loans.
I am ofcourse bot talking about private loans
@@Robis9267 the government is the loan provider right? They are the ones providing public loans.
I am ofcourse bot talking about private loans
Banks won't allow people to borrow more than the value of a home for a home loan (or a percentage over/under). Why on earth are we allowing people to take out student loans for way more than what that degree can earn in a year?
Too many people are borrowing way too much, and our government allows colleges to charge way too much.
Special interest
Just to see how crazy things are...I have unemployed and filed for student aid and got offered a 20k loan. I already have loans that are 19k. These people just want to make a profit at 6.8 % interest while you are in school or unemployed. The sad part is that they garnish your wages and social security if you can't pay! Predatory lending at its finest.
Can we take a moment to point out THIS is what you have to go through to get a college education in the United States, the "greatest country on Earth?" Is it any wonder that we are falling behind other nations in education? And we have radically stupid ideas that gain enormous popularity (flat earth, anti-vax, etc) because a vast majority of the population can't afford to go learn critical thinking skills. Our grade schools and high schools have turned into nothing more than glorified daycares with no-child-left-behind graduating high school seniors with a grade school reading level. Then they go out and vote on public policy and gain elected office. It's a full on recipe for disaster. For a healthy, functioning *democracy you need an informed and educated electorate. "The best argument against democracy is a conversation with the average voter."
Many educated people rejected the vax ding a ling.
Education is free, go on google and see for yourself
Indeed :(
I am not an economist nor a historian, however let's look at the reality. Housing, education, healthcare, and mental health, gun violence and stagnant wages are what working Americans are dealing with. Population decrease and deaths of despair are on the rise. These problems are being ignored and all the time and energy are being put into fighting against each other with "Identity Politics". This country is failing and soon will be falling. Only the wealthy will be happy or satisfied. Gen Z and GEn Alpha will not fall for the ignorance of the prior generations...THE AMERICAN DREAM IS DEAD! Wage slavery is in full effect.
So annoying! I was a CEO and drove a 2004 Ford Ranger so I can pay back my student loans. Colleges won’t lower tuition until the government stops loaning students so much money. Lower the loan cap and colleges will have to lower tuition. If we wipe out debt, more will come because the core problem isn’t resolved. Gggrrrr!
I learned this stuff in law school I'm so glad your about to teach the public about this incredible
Why not mandate all payments should pay off principle first? Interest repayment starts when only 20% of principle is left. This optimizes payment for students and ensures an interest payment to banks. Yes it is a lower interest for banks, but the government won't need to pay such large amount for loan forgiveness if they choose to do it,
Edited: typo and sentence structure
😂 that's a good idea but our government is corrupt and in bed with those that give out these loans. They will never pass a mandate like that. It is profit over EVERYTHING.
That’s not how money works…
I paid 30k for an education, yet I can’t get a job with it that will let me pay it back 🤔
What degree?
Master of Social Work 2008 - owe more than 3 times amount borrowed- retired- turning 70 years old this year - volunteer services. ✌️
@@carrolabrams2659 I feel for ya, but my welding tech school that has more than payed for itself building tangible infrastructure doesn’t feel like paying for the bailout of your masters degree in social work through our tax dollars.
Why wasn't there any mention of the boom to the economy once loan payments are reduced or eliminated? There seemed to be only mention of how the lack of loan payment and debt forgiveness may hurt the government in billions of dollars.
My understanding is that, unless you successfully complete a Public Service Loan Forgiveness program, you will still owe taxes on the forgiven debt the year it is forgiven as it counts as "income." So this could end up still screwing borrowers who will owe more at the end of the 20-year Income-Driven Repayment plan, unless the law would change this too?
Many, if not most, student loan forgiveness programs are already federally tax free. Most states also follow the federal decision. If you qualify for more than one program, it would be smart to pick the tax free one.
Other forgiven debts are taxed as normal income.
BG is mostly right, but check your specific state. There are a handful of states that still tax student loan forgiveness as taxable income. Even a gigantic tax bill is preferable (and able to be negotiated into payments) over the madness of a forever student loan interest only payment h-lllscape.
It’s counted as income in every state if it’s a federal loan through .GOV … you pay just like income on the forgiven amount
LOL ! $30K ? AMATURE. Private University costs: $ 54,154 PER YEAR. And, if they don't raise the tuition fees, that's $ 216,616 in Tuition costs alone, not including lab fees, books, snacks, a car, clothing, activities, sports, travel, electronics, software, parking, and taxes.
Imagine taking out 30k loan to make 30k after graduating…. 💀💀💀 even working a minimum wage job will get you close to 30k a year.
Better off taking out loans and fleeing to the Philippines.
So what if you find 30000 and then start university
Why does the government issue loan have an interest? It's better just pay back the amount borrowed.
Inflation
Because those loans are managed by private companies and that interest allows them to make money to pay for the workers. If the government managed those loans, it would be far worse than it is now, with bloated staffing and excessive salaries/benefits for those additional government workers.
@@761jared well to what Mike is saying...inflation is (historically) 3% a year....been around 8% in the past few but if you pay the exact dollar amount back over time the person who issues the loan would loose money
Why would you sign an agreement without doing the math of seeing how fast you could pay it off?
Or
If the degree you got is so worthless it can't even pay for itself, that sounds like a problem you should take to the university, not a problem I should have to pay for.
And just a reminder: nurses and teachers are extremely important, essential jobs and the pay is dirt.
If you ask me, anyone who can handle nursing school and then work as a nurse for 10 years should have their loans forgiven. The same for public school teachers. When a job is that important, that demanding, we should be bending over backwards to make sure we have enough qualified people to do the work and make it accessible so that anyone who is smart enough and can do the work can get the degree and do the job.
Nobody forced them to do that lol
@@dutchmaster4309 Cool. No more educated workforce.
@@yosemite735 they choose to do that …. It’s the same accountability argument that critics of total loan forgiveness are giving
I’m a Mary. I started out at 69k and after 6 years it’s at 75k. They wanted over 1k in payment a month which I could not afford even having both of us working full time. Also, why is no one questioning all the loans forgiven for politicians? I’m sure that costs the country as well.
Mixed feelings on this and I can see the argument for both sides...problem I have with all this is nobody (those that make these decisions anyway) is talking about or trying to solve the root of the problem in the 1st place, why is the cost of higher education beyond high school so expensive that these non-friendly borrower loans are needed to begin with...
#1 Tuition costs are completely out of control and unregulated, checks, balances, and cap ceilings need to be in place
#2 Colleges and Universities are just as guilty as our government of frivolous spending, no discipline, no accountability, and no limits on their spending etc...
#3 Not nearly enough of what these colleges and universities make in revenue goes towards academic scholarships.
4# Tuition rebates need to be awarded to college students who complete/graduate and maintain certain GPA levels to promote academic excellence and a way to ease the costs of higher education!
I could go on as the list of what is wrong with the education system in this country is quite lengthy...especially higher education! Much like the Affordable Care Act (Obamacare) that is laughable, while it did make healthcare more widely available to many more people, but affordable is a joke...problem is it did absolutely nothing to reduce or curb the skyrocketing costs of healthcare, the reason basic needs such as healthcare became out of reach for so many to begin with! Different topic and different argument for another time.
I'm just pointing out how many people, especially law makers in our government are reactive when they should be proactive and preventative before problems escalate beyond repair!
Yessss... Stop asking who is going to pay for it and start asking why the cost is so high.
Lowering or subsidising US universities tuition and fees is the only long-term solution.
@@itzasweater9621 I'm not a US citizen and don't know much about your Adult Schools, but it seems to me you are making Universities analogous with technical schools. To my little knowledge there is a huge difference in curriculum, teaching, campus environment, student profiles between these two. My point was- quality education in USA is ridiculously expensive (especially in top universities) and it's possible to lower the burden on students. Say for instance, Germany has a GDP or 1/6th of USA but students in their universities have to pay literally €0 in tuition, even the international students as well. I don't see why US universities tuition cannot be lowered or subsidised. The very reason that students cannot repay student loans is the enormous tuition fees.
@Shabbir ansary Sunny If you can't afford it. Dont go. Period.
@@bikboto-zx6my US students end up having this huge debt burden precisely because they take loans for programs they can't afford. To eradicate a problem you need to understand the root cause of that. Until that happens students can look for scholarships to fund their degrees. You don't decapitate yourself just because you have a headache.
Honestly young adults shouldn't be allowed to get these loans, hopefully it would prevent these universities from increasing their prices. People get mad at the universities for increasing the price but there's nothing preventing them because every student is basically given a blank check.
Any time someone says a govt program is expensive or will cost a lot, I want an instant comparison to how much our military budget was increased this year, and our total military spending for the past 5 years. Or how much was spent on subsidies for oil corps. Or how much the top 10 companies received in tax exemptions. That should put things into proper perspective.
Nothing will stop the problem until loans are capped and universities can't keep raising the tuition. The tuition hikes have been like an arms race to build newer buildings and facilities so that universities have a "luxury" feel to them and obviously bureaucracy increases with new administrative roles to fit political ideology.
This is entirely unconstitutional. FJB
I hate the fact that people just assume people with student loans don't want to pay. We DO, but the current system makes it impossible to pay off on your own in some cases. I'm glad there seems to be a light at the end of this tunnel.
Never thought the journal would mispronounce a common financial term.
AMORTIZATION = A•MR•TAI•ZAY•SHN
1:43
You fail to mention they taxes dues At forgiveness. IDR plan balances forgiven are treated as income and the tax bill is due in full that year. And that can be a big tax bill.
Based on Biden's relief plan (if it goes through), federal taxes do not have to be paid. However, if you live in mostly 7 states (Arkansas, California, Indiana, Minnesota, Mississippi, North Carolina, and Wisconsin.), you will have to pay state tax on the discharge. *So it depends. Tax rules change every year or quarterly so it is advisable you speak with a tax expert if you are in this scenario.*
Theoretically this could be qualified as a progress. But if we think about the money flow; before it goes, from bank to school, then from students pocket to the bank with interest. Now as per this reform, money goes from bank to school, then from students pocket + tax money to the bank with interest ( banks are not a charitable institution, they will get their money + profit back for sure). I’m sure this plan will help lot of students. But since tax money will be involved in this plan, why not simply making education system it-self more affordable? Only reason why genuinely affordable education system is not happening is because politicians want to keep the current meritocratic system? The efficiency is the core value in the current civilisation, so why not using the tax money efficiently to make the education system affordable?
I don't know your main message, but I believe politicians don't want to make College tuition-free because making College affordable would be one major step in reducing poverty.
Since very few jobs, that are well-paying, exist that are accessible without a college education, let alone a high school education that used to be a ticket to the middle class.
Federal loans are not dealt through a private bank. The federal government owns the debt and risk.
Education can be cheaper when the government decides to stop subsidizing universities through student loans.
So will we need to sign up for this? Is it a new program starting in July? What about existing loan balances or is it only for new loans taken out? What if some of our student loans are private loans?
I'm on the lower or no intrest train. I know how much money I took out and made a decision for myself and if the government wanted all that money back I would be fine with being held too it... but younger me didn't understand or get set down by someone and carefully explained what interest was and that I would owe it. In a way I feel like this intrest and the push for my generation to go to college was slightly predatory on the government's part.
There certainly are a lot of palms getting greased in the higher education engine not just the government. In an opportunistic society we should not be surprised that many saw a MONEY GRAB and did what any good opportunist would do.
its sad looking back.....in college I mostly taught myself through reading textbooks and watching RUclips calculus tutorials. Its hard to learn much in an auditorium classroom of 400+, 1-2x a week. Yet, I still had to pay 30k for that piece of paper. Its honestly disgusting.
Same. Bachelor degrees should be two years.
Considering they forgave the ppp loans there’s no reason not to forgive an amount of student loans. As much as people want to complain it’s not fair and personal responsibility they don’t complain when other benefits are provided that benefit them. Smh!
PPP loans were the result of COVID measures businesses wanted no part of. A student loan is something you willfully take out. Im not paying some deadbeat student's loans.
The same reason the tax code has more and more pages of "exceptions" for corporations added to it every year after lobbying.
Did you honestly think the government cares about you? That's quite hilarious.
Our society encourages college educations so, yes, people will believe they need one to make a good living and they won't always be able to afford it upfront... they are doing what they think they need to do to succeed. Unfortunately, some colleges and universities have capitalized on this and charged exorbitant tuitions knowing that the government backs the loans. This isn't that much different from real estate developers who build homes in flood zones or sell homes to people who can't afford them, etc. They know that they will sell the loans right after they and the homeowners close the deals and they'll make off with all of the money and none of the responsibility. If there are major storms causing property damage/loss or any kind of mortgage loan crisis, the government will have to be the ones to step in.
Its Marys fault for not doing research about her degree. She chose to take a loan for a degree that won't cover her loan. Why shouldnt she be liable to pay?
END COLLEGE> it is a waste
A massive part of this problem is people get these loans having unrealistic expectations of earnings after college. I had classmate who genuinely believed they would make in excess of $100k/year in their first year out of school.
Cool story bro. But I don't think that ONE person represents the majority. That's what we call an anecdote, not data or facts.
@Paula Olson okay what about the dozens of people I knew that refused to work and rented the nicest apartments in town? I worked at a zipline, made $15/hr plus tips and people would apply then refuse the job when finding out they'd have to work over spring break.
@@theonly9 so a few dozen people represent the majority of loan borrowers?? I went to a small liberal arts school and a large state university and most of the people I've encountered did work (including myself) during school and on breaks and all that money went to school. I lived in the dorms and definitely nothing extravagant. Idk who you were hanging around with but they aren't the typical student.
@@paulaolson983 I guess my point is 1 idiot can cost as much as 5 smart people for the same degree...see a problem with that?
Because we have 18/19 year olds making the decision...
I went to a state school, graduated in 4 years and worked 3 jobs while I was in school still and will be in debt up to my eyeballs for the foreseeable future. My parents made "too much" for me to qualify for grants or income based scholarships, but not enough for them to cover the cost of college for my sister and I. Jobs don't pay out enough for people entering the work-force. & college degrees are pretty much a requirement at this point even for entry-level positions. The cost of living is ridiculous and more than half of my income every month goes towards my student debt. Not everyone can be a doctor or genius. They are slowly phasing out middle class, working Americans. The rich are really rich and the poor are really poor. I know not everyone agrees with student debt forgiveness, but something needs to be done. My generation of people work extremely hard (despite what many think) and we often feel like we get nowhere. There is a lot of frustration and feeling of hopelessness for us in our 20s. What's the point of working our youth away only to live paycheck to paycheck? Not hating on the elderly, but the difference between being poor in your 20s is we haven't had the time to save yet, so why do only the seniors get benefits and tax breaks? They were able to start a life without being in debt and build equity a lot easier than today's youth. I can't buy a home, rent an apartment, buy a car, have kids, my health insurance from my parents is up next month...We are just pleading for some kind of help. Even if they just continued no interest payments, that'd be helpful at this point.
What happens if a payment is missed in the new IDR plan? Are you kicked off the plan?
I would like to know how deep we are into this income driven payment plan. It seems to be a well guarded secret until 20 years goes by and you realize you got reset at some point.
It will never change unless you hold colleges accountable. If your degree cannot get you a decent paying job, it's an intellectual luxury product.
Go with the 10-year standard repayment plan. All these other government programs/solutions that they keep recreating are made to keep you in their pocket for longer.
The predatory servicers that offered you a forbearance time after time after time, knowing that every time you took one your 20-year forgiveness plan would reset. All those loans are still out there, and this new plan won't change that. All those peeps are still goofed over, they've paid in thousands, and their loan balance is still higher now then when they took out the loans.
Student loan forgiveness does absolutely nothing to make education more affordable
Exactly the flood gates of out of control tuition are still wide open. Biden and his homies won't touch that.
You are right. Legislation and caps on tuition should be put into place. But Biden campaigned on student loan forgiveness and I want to be forgiven.
@@nwatson2773 I get your point. Also I'm too old to believe the promises of politicians.
@@nwatson2773 Biden was dishonest and corrupt in doing that. They knew it would not happen, but they only care about fooling the masses into voting for them. Sorry you were lied to.
I have a better idea. Student loans can be given if you go to a state school and it only pays for tuition and reasonable expenses. The best thing would be to go local and stay home. School is not for partying and getting the College Experience, it is to learn.
How about if your degree path is important? We don't need business majors.
Exactly! Getting to the point and learning to become responsible.
I had a loan servicer PHEAA or Fedloan I don't recall, who 12 years ago did everything in there power to withhold information, thwart, or lead me into a situation which would be to their advantage in making more money for themselves as servicer. My servicer did everything they could to prevent me from getting into a program to lower my payments. They must of been threatened with legal action because things got better all of a sudden. Today, all the things I need to do especially pay down my loan is made available over the website. No more scamming from Customer service agents.
A little over 50 years ago, someone could work full time over summer and earn enough to go to college for a full year. Now, even if you work full time, you cannot afford college. The equation changed, and the two biggest factors have either stagnated for decades (wages) or exploded in cost (college tuition going up several hundred percent in a few decades). This doesn't even factor in the exploding cost of books due to exploitive professors, blatant greed by publishers, and housing costs that have gone up 20x since the 1960s.
Corporate/college profits are at all-time highs, while consumer costs keep going up with no end in sight (thanks greedflation). There needs to be new regulation on the blatant greed of these colleges, and the massive corporations that have a pseudo-monopoly over the education sector must be broken up like Bell/AT&T was. The control they have is insane. These companies are so focused on short term capital gains, they are actively dooming several generations of future Americans to never ending debt that ultimately causes more harm to the economy. The financial security of our country is at risk while we let fat cats gorge themselves with short term profits.
You can also guarantee student loan companies are dead focused on destroying any forgiveness programs, and exploiting students as much as possible.
The ironic part to me, is that most of the detractors to something that might actually help fix the college cost problem in the United States, benefitted from cheap tuition in the first place. And get this, they even passed laws so that senior citizens (themselves) can get free (or heavily discounted) college tuition. Absolute hypocrites.
crazy how they dont want to address underlying issue and keep issuing loans for useless programs which have no income potential, and the tax payer has to take on the burden.
student loans should only be given to STEM and Medical courses.
No, that's friggin stupid. Education is more than just going out and searching for a job getting money. Always thinking like a dumb American.
how could neomarxists feed themselves?
Doctor's already receive student loan forgiveness. They work in low income neighborhoods and don't have to pay their loans.
Why wouldn’t a country have free college for its people to be more successful and better the country as a whole?
The American economy runs on poverty, or at least the constant threat of it. Americans like their goods cheap and their services plentiful and the two of them, together, require a sprawling labor force willing to work tough jobs at crummy wages. On the right, the barest glimmer of worker power is treated as a policy emergency, and the whip of poverty, not the lure of higher wages, is the appropriate response.
Affordable college would be one major step in greatly reducing poverty, and politicians do not want that.
1. "Free" colleges are not free. You will be paying for them for the rest of your life, regardless of whether you went to college or not.
2. Over-saturation of degrees, which will lead to higher and higher requirements for menial jobs
2. The vast majority of higher education does not benefit society in any way, shape, or form. Think gender studies, arts history, political science, etc... majors.
@@ussocom3644 Yeah, you’re right. We can’t have too many people educated, that’d be a bigger problem.
@@rainbowglittergang1801 Selective hearing at its worst.
This overlooks the fact that forgiving student debt increases the individual's taxable income and would not cost the government as much as has been claimed.
Also boost the economy
I see it from both sides. Yes I have student loans (waiting on Biden Bucks to be debt free and have paid over $40k back)
Crazy how you initiate a loan and accept terms.
Crazy that a degree is not worth it anymore.
Crazy that income driven repayment is an option (I just learned that from this video)
Crazy college parties, hangovers & memories…priceless
The only way for college prices to come down is for the education of millions of high schoolers and advisors to show them that it’s likely not worth it anymore. Which in turn should lower admissions. Of course the Department of Education and lobbyists would take that well.
The real question is how Mary managed to get a loan when her job perspective was so poor. The real solution is that certain college major shouldn’t be eligible to student loans.
Non-profit work has entered the chat
Seems fairly obvious the Student Loan Program need updating. Also when applying the salaries of students once they graduate should be considered when approving the loans. Colleges also need to be guaranteeing 35% of the loan debt. Everyone need to absorb some of the risk. Options must also be available.. Two years military or another service for every year of college if debt defaulted or after graduation.. Need to drastically reduce the number of Liberal Arts Degrees funded..
How about colleges foot the cost of education and make loans with a %salary payback program. This will align their interests with the interest of the graduate to get a good paying job. Instead they are pumping students for money and subsidizing the good students for statistics and the football and basketball athletes for ticket and broadcast sales.
No what’s obvious is that I was not worth it for Larry to go to college at all.
It cracks me up that the boomer generation built a society that works FOR them, but young people today can't do the same. They had corp taxes higher than 50% during various years. We built the national highway system, put a man on the moon, and diverted funds to help people in need with various programs. We built the middle class and people had the highest purchasing power ever during the 60s. Lots of them even went to college for free or low-cost amounts. The purchasing power they enjoyed allowed people to go to college, secure housing, transportation, and other necessities for the salary of a part time job. But now that they're old and losing control, they won't allow that change in power/control to go to the younger generations, so they can mold society to benefit them. It's the most egregious thing I've ever seen. The college system has turned into loan sharking. Education is vital to building our society but it's running rampant with uncontrolled costs, bloat, and fraud. It's time to reign it in.
Thanks for including