Tag Archives: Student loan

The High Cost of College

On Monday you saw an article by Thomas Anderson discussing the Student Loan debate, or more precisely, the debate about the Student Loan debate.  One thing, throughout all of this that seems to be ignored is that the cost of going to college has increased dramatically.  In the 11 years since I graduated college, my alma-mater has almost doubled tuition (around $2,300 to now $4,300+).  In that time, inflation has increased only 30%.  That means that tuition in 2001 costs, adjusted for today’s inflation, would be just under $3000.  That is only a $700 increase…not the $2000 increase you see above.  Remember, this does not even factor in the cost of student housing or books which can fluctuate for each student but DO factor into the overall amount a student takes out for a loan.

 

 

 

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Student Loan Debate

When student loan interest rates were temporarily reduced from 6.8%to 3.4% a few years ago, it was to relieve those who had subsidized Stafford loans during tough economic times. The problem with giving temporary relief to group of individuals who are relatively new to creating personal budgets (recent college graduates) is that they rarely ever prepare for when the temporary relief ends. However, the idea of offering temporary relief in this case was that the economy was bad, so we’d make it easier on those with students loans to handle their debt Then when the economy rebounds and things look better for them, we can return interest rates to pre-relief levels.

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