This year, for the first time in history, student loan debt outweighs credit card debt.
Outstanding student loan debt in the U.S. currently exceeds $850 billion, according to a USA Today article.
According to the article, from 2010, consumers owe about $828 billion in revolving credit, including credit card debt, according to seasonally adjusted numbers in a report on July credit from the Federal Reserve.
Eryka Wallace, a junior public relations major at U. Southern Mississippi, said she feels getting a college education is worth the investment. Wallace is paying for her education partially with loans.
“I think that if students can’t pay for it by ourselves through scholarships and our parents, then yes, its worth it,” she said.
Wallace said upon graduation, the loans pay for themselves when those who were students become a part of the workforce.
“Without an education and good job, we can’t live the ‘good life’ that we all want so badly,” she said.
Bradley Jackson, a recent USM graduate, said a degree is always a self-sustaining investment. He graduated last fall and was able to find a job in his desired field. However, he knows people who are still unemployed after graduating.
“It seems like a degree is not a guarantee of a job that’ll help you pay back debt any sooner, so going to school and accruing that debt is a gamble,” Jackson said.
According to the Project on Student Debt, 52 percent of Mississippians have student loan debt, and the average amount of debt is about $22,000. At Southern Miss, 65 percent of graduates leave school with $19,000 in debt along with their diplomas.
As increases in tuition quickly outpace inflation, students are borrowing more and not necessarily landing jobs to pay back loans that become due after graduation.
According to www.FinAid.org, a student who borrows $20,000 to pay for a Bachelor’s degree will pay back $27,619 over 10 years at a monthly payment of $230. At a 6.8 interest rate, that is over $7 thousand dollars in interest.
New legislation by the Obama administration aims to ease the burden of debt on students by offering monthly payments based on income.