Student loan debt isn’t going away anytime soon according to the new numbers from the Department of Education and the Wall Street Journal.
Graduating seniors can expect to hold an average student loan balance of $39,910, perilously close to the $40k mark. This only takes into account those graduating in May/June of 2017, not to mention those choosing to continue their schooling in master’s or doctoral programs.
Looking back at historical student loan balances….the graph below speaks for itself:
In 2003, the average student loan balance for a graduating college senior was about $18,200. Over the same period of time, inflation rates would have normally caused that $18,200 to translate into about $24,900 in 2017 dollars. Suffice to say, seniors today would probably kill for that kind of balance, but students aren’t necessarily to blame for most of the rising balances.
The cost of attendance at four year universities has nearly doubled during the same time frame, primarily as a result of the ease of access to student loans. Administrators know that students are going to be able to get these loans relatively easily from the federal government, which leads to higher tuition, textbook and boarding rates.
A significant problem now is that schools are spending more mainly because they can, if the easy money goes away, many public universities are going to be in a severe pinch for funds within a few years.
This is just another example of why it pays to specifically plan out your college career both before and during your undergraduate years. Students who know they want to go into a field with relatively low unemployment and fairly high salaries can likely go full throttle and be alright. Students who have no idea what they want to do would probably save tens of thousands of dollars by going to a community college for a year or two in order to take general education classes.