Disclaimer: This post was made in collaboration with MoneySavingPro.com. Opinions are my own.
MoneySavingPro.com recently released a study that details the differences in student loan debt among states in the U.S. The study is so detailed and so in-depth that I knew I had to share it with my audience, of which many readers are dealing with student loans every day.
In this episode I discuss some of the findings, why student loan debt is a major problem and what people who carry student loans can do about it.
- Student loan debt is at an all-time high. A recent news report I saw noted how college tuition is double of that of our parents’ generation. MoneySavingPro.com notes how between 2004 and 2014 student loan debt increased at double the rate of inflation.
- There are major differences in student loan debt depending on region and state. There are many factors that contribute to this including, the amount of debt students are carrying, tuition costs, the percentage of students carrying debt in each state and the rate at which student loan debt is increasing.
- Delaware’s student loan debt increased by almost 130 percent in the time period mentioned above.
- States with the highest student loan debt tend to be located in the Northeast and Midwest.
- New Hampshire had the highest percentage of student loan debt with 76 percent of students carrying debt.
- Utah had the lowest student loan debt with an average of $18,921. New Mexico, Nevada, California and Arizona followed with average student loan debt of $20,418.
Why Is This a Problem:
- It’s no surprise that student loan debt has become a major policy issue. I’m looking at you Democrats.
- People are starting to question whether or not an education is worth it. While evidence suggests that those with bachelor’s degrees make more money than those with just a high school diploma, skyrocketing tuition costs and stagnant wages are causing a big problem for graduates.
What I Think:
I’m Team Go to College. If you think you’re making crap money with a Bachelor’s degree try not having a bachelor’s degree.
I’m also on Team Don’t Be Stupid With Your Money. Read the terms on loans, go to affordable schools and get a marketable degree. If you don’t get a marketable degree (I get it. This creative wasn’t meant to be a doctor either.) then get ready to create your own career like I have. The only way for me to make good money as an English major was to start my own business.
Now, despite all the variables that go into student loan debt, some of which are in control of the borrower, I still think we have a problem. Costs are rising way too fast for a degree that everyone now has. Additionally, wages aren’t keeping up. It’s definitely an issue that needs to be addressed and fixed.
Options for Paying Down Student Loan Debt:
- Consolidate. If you’ve got multiple loans and trying to keep up is driving you insane then consolidating may be a good option for you.
- Refinance. Refinancing is an option for those of you with high-interest rates and high monthly payments. Refinancing will bring down the amount you pay each month and possibly bring down your interest rate as well. Just note that it could extend the time of your loan.
- Note that for both options mentioned above you need to shop around. Private and federal loans are not created equal and there are several factors to take into consideration depending on the kind of student loan debt you are carrying.
- Find ways to make extra money. Believe it or not, sometimes the easiest solution is to make more money. Ask for that raise. Find a new job. Get a part-time gig. Start a side business. Raise your rates.
- Find support. There are plenty of bloggers and communities available that support student loan borrowers with their debt repayments.
Helpful links and resources:
- MoneySavingPro.com study
- Make Money Your Honey Podcast Episode 5: Acorns Review – Explains inflation and why we need to account for it.
- Make Money Your Honey Podcast Episode 2: How to Pay Down Student Loan and Credit Card Debt
- Dear Debt by Melanie Lockert
- Debt Free After Three by Zina Kumok
- American Student Assistance – Non-profit org I’ve worked with very closely in the last four years as one of their community experts. They provide education and resources for federal student loan repayment.
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