How Can We Save Future Students From Student Loan Debt?

Did you know that students who graduated college in 2017 held an average of almost 40,000 in outstanding student loan debt?

This marks an uptick from the 2016 graduates who held an average of about $37,000 in debt prompting the CBS news headline "Congrats 2016, you're the most indebted yet".

While unemployment for recent college graduates has fallen in years, underemployment remains extremely high. 43% of recent of recent college graduates are under employed. This means they are in a field that underutilizes their skill like a Starbucks  Barista with a Bachelors degree.

This article can be found at https://www.youtube.com/embed/FeTOpXsolkw

These numbers don't pay a pretty picture for students who are about to graduate from college and pursue the career of their dreams and unfortunately due to federal policies, schools can get away with a poor track record of success and qualify to accept student loans and grants.

You can find out more about how to get your student loans out of default by clicking here.

Thankfully some universities are looking for innovative ways to ensure that their students have success after graduation.

For example, Purdue University has started an initiative that finances the tuition for students who wish to participate in exchange for percentage of the students future earnings. This arrangement, almost known as an income share agreement, incentivizes a school to graduate their students with the best possible skills to compete in the job market and secure a well paying job.

Purdue University has also been able to finance it's programme without raising tuition for the past seven years. Policy makers need to look at changes to the higher education system that will prevent the class of 2019, 2020, and 2021 from becoming the next most indebted class.

The class of 2019 will likely face the same struggles as graduating classes before them but with reduced federal intervention in higher education and more innovative options, there may be few classes that share the same fate in the future.

When can my federal student loans be forgiven, canceled, or discharged? 

You must repay your loans even if you don’t complete your education, can’t find a job related to your program of study, or are unhappy with the education you paid for with your loan. You also can’t claim that you have no responsibility for repaying your loan because you were a minor (under the age of 18) when you signed your promissory note or received the loan. However, certain circumstances might lead to your loans being forgiven, canceled, or discharged. Read more...

Whatever your situation, it's highly advisable you research your state of affairs online. Don't just accept the heavy weight of an overwhelming student loan. It pays to take the time to seek out advice from those who can help you deal with your loan effectively and you might be surprised by what you can achieve.

For more tips on how students can pay off student loans faster, watch the video below:

10 Things You Should Know as a Student Loan Borrower

As a student loan borrower, there are some things you are expected to know and understand. Here are ten things you should know as a loan borrower.

1. Borrow as little as possible.

Sometimes people forget that they will owe loans back with interest. The less you have borrowed, the less you owe back. Seems common sense, but sometimes people forget how much they borrow, and they get into financial trouble when they graduate. Always use loans as a last resort, and if you don't absolutely need to borrow loans, then don't.

2. Have a financial plan while you're in school.
Don't wait, start now! It's a good idea to know how much your schooling will cost. Map out how much gas you'll use going to school, school activities, etc. Go here for some helpful tools on how to do this.

3. Create and follow a budget.
Don't wait on this either! This will be critical when you graduate. You will need to pay attention to how you spend your money because you will likely owe back loans. For help with budgets and some helpful tools, go here.

4. Understand your loans.
If you don't understand what kinds of loans you have, you won't be able to deal with them very well. You should know what types of loans you have (subsidized or unsubsidized, federal or private) and how your interest works (fixed rate or variable rate).

5. Know your loan servicer.
You should know who is servicing your loan in case you have any issues and need to contact them. The easiest way to find out is to go to the NSLDS website. (You will need your FAFSA PIN to access your information.)

Read entire 10 Things You Should Know as a Student Loan Borrower where it was originally published.