College debt hits tipping point

We’ve hit The Tipping Point for Higher Education, writes Maya Frost.

. . . student debt loads have become so obscene that $100,000 in loans now seems like a pretty good deal. (Or at least, that’s what university officials say to reassure us.)

Students and parents are suckers, she writes, if they “spend the next two decades in debt for a bachelor’s degree that barely guarantees them a living wage.”

Whether college is worth the cost depends on the kind and quality of the degree: Technical skills tend to pay off, so do degrees from prestige institutions.  And savvy students who go to public institutions may graduate without crippling debt. But I wonder how much longer people will burden themselves with huge loans for a Whatever Studies degree from Mediocre College.

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  1. Clearly, the move toward “dual credit” for capable students sounds better and better. Additionally, students may look to more schools that will accept and credit AP/IB scores, as many private colleges refuse to give up the tuition they reap.

    A considerable number of students are ready to specialize at the college level by sixteen or seventeen, which means a bachelor degree should be attainable in a couple years, saving a lot of time and money for both the student and the system.

  2. Exactly, Joanne.

    Parents and students are now assessing the value of a degree in terms of how it will translate into meaningful and well-paid work in the future rather than merely picking an intriguing liberal arts major from Prep U.

    And on the notion that prestigious universities still guarantee “success”–I’m hearing from plenty of frustrated grads (and their parents) who have Ivy League degrees from 2008, massive debt and no job that can even begin to cover the monthly payments.

    As I say in the book, it’s no longer who you know or what you know that matters–it’s HOW you know what you know (classroom-only vs experience) and WHERE you are willing and able to use it (small town, big city, abroad, etc.) Those who are flexible and aware of their options throughout their school years will have the upper hand over those who simply sign up for a four-year degree without putting much thought into how they can deepen, broaden and leverage it.

  3. I agree that one of the best things you can do for a kid is teach them how to maximize choice in his/her life. But I do think that college and the admissions process operates in cultish overdrive. Half of the kids who enter as freshmen never get degrees. I honestly believe that there are many, many kids who would have a better (and happier) life with a 2 year degree, or as hair stylists or carpenters. Our pressure often limits those choices.


  4. When I was teaching technical subjects at a state school, half the students we turned out were going into jobs where they could have received adequate preparation at a community college – they were just convinced they needed the credentialing from a 4-year. Also, the department’s “bread & butter” – the massive courses we taught so that we could afford the small, specialized classes for our upperclassmen & graduate students – were remediating skills that were on the state highschool syllabus but weren’t actually learned.

  5. It looks like Maya is more interested in flogging her own book than thoughtfully addressing the issue of student debt. As far as I can tell, the median undergraduate student debt is about $16,000 (with the average being $18,000). Those numbers don’t strike me as particularly excessive, especially in light of the various repayment plans that are available.

    $100,000 in undergrad debt is, of course, insane – but I don’t get the impression that that amount of debt is very common.

  6. Anne Marie says:

    Dear PeterH,
    The numbers you quoted is the typical cost for New York State public colleges (SUNY). The tuition for 1 year at a state 4 yr undergrad program w/o board is $4,780 and with board was about $9,000. Needless to say with the economy in tatters, admissions officers of these institutions have admitted that applications are 120 – 150% higher than last year. With limited access to these schools, students move toward private colleges. Many New York private colleges are at least $17,000/yr. without board. With the limited access to aid and federal loans, students are then guided to private loans and fill the gaps with credit cards. A vicious circle. It may be different in other parts of the US but in the tri-state area this is our reality.

  7. The $100,000 figure might include graduate school, medical school and law school debts.

  8. To Peter and all,

    Didn’t mean to “flog” the book–just stating what I am hearing from parents and students who are questioning the amount of debt they incurred based on the advice they received, namely that they could easily afford to make the monthly payments if they got the high-end bachelor’s or master’s degree because they’d be sure to get higher-paying jobs. They were sold a bill of goods, much like those who got those sure-to-be-a-smart-move mortgages.

    Yes, there are indeed cheaper options, and more parents and students will be choosing them. But there are still plenty of families making decisions that will result in crippling loan payments for the next decade or two–even if the student fails to graduate!

  9. “The $100,000 figure might include graduate school, medical school and law school debts.”

    It’s definitely more like it. After four years of private undergrad and three years of private law school, my total educational debt was about $94k, and that was with half my law school tuition covered by a scholarship. I graduated from law school in 2001. Since I’ve been working for the State ever since (first as a legislative staff attorney and now as a prosecutor), between payments made and deferments/forbearances taken, it’s STILL right around $94k.

  10. I attended college in the 80’s and again in 2000-2007, I have no college debt, and almost 3 degrees in technical fields. It’s a shame that students have to go so far into debt to get a piece of paper that in some cases is academically no better than a high school diploma in the 1960’s was.

    Colleges have been more into flash and splash, as opposed to making improvements to get students finished with a degree (once everyone has a college degree, they aren’t unique anymore). Also, many trades can be learned through a certificate or associate’s degree program at a local junior or community college.

    In reality, I think that all students should do their first two years at a community or junior college (to see if they can actually finish a degree or certificate program), then transfer to a four year college to obtain the bachelor’s

  11. Well, why are colleges offering degrees in useless majors? I can think of half a dozen fields that lead nowhere.

    Starting a community college sounds great, but many students can’t get the classes they need to transfer.

  12. It’s terrible that young people have to borrow that much money in order to get an education and contribute to the country’s assets. And they call $100,000 a good deal? Give me a break for that’s not a good deal. That’s why I try to lead students to websites where they can get help.

    Evelyn Guzman
    Debt Challenger

  13. Elizabeth says:

    I graduated mid 1980’s with ZERO debt – put myself through school. It did take me more than 4 years, though. I got a degree in what translated into a decent-paying job. I can understand undergraduate debt if you’re trying for Med School – but I suspect a sizeable minority of high debtors were Sociology majors who partied through 4 years.

  14. A high school diploma is becoming more and more important in today’s working world as a necessary step towards achieving success