College: Skyrocketing Costs, Student Debt, and Budget-Wise Choices

Not only does student loans and the debt they entail make headlines, such loans have become big business for the federal government. In fact, government student loans have nearly doubled since 2007, leading the US Department of Education to post a profit of more than $42.5 billion last fiscal year. Had Obama and Congress not temporarily cut student loan rates this summer, that number would have been about $8 billion higher, eclipsing 2011’s whopping $47.9 billion.

The other result: Student loan debt is now about $1.2 trillion. “This,” says Federal Reserve Chairman Ben Bernanke, “is a burden affecting, for example, young people’s ability to buy a first home, affecting other purchasing decisions they might make, and obviously affecting their financial… overall situation.”

Meanwhile, the Bellevue University study, The Search for Affordable Alternatives: Rising Costs and Massive Student Loan Debt Put College Out of Reach for Many, found the following:

  • 68% of Americans believe college degrees currently cost more than they are worth.
  • 36% said the cost of a deal has increased at a faster rate than its value over the past 5 years.
  • 76% said affordability would be important to them when pursuing a degree.
  • 37% said affordability was the most likely motivation for them to pursue a degree in the next five years.
  • Only 40% said getting more education is worth getting into more debt.
  • 55% said they would only go to college if it wasn’t their fault.

About such results says the President of Bellevue, Dr. Mary Hawkins: “Students of all ages understand the value of a degree, but many students are unable to pay more than is necessary to earn those degrees. As colleges and universities make their programs more financially accessible, it will give more adults the opportunity to learn the skills needed to fill the high-tech and high school jobs of the future.”

How much does college cost these days? According to the College Board’s Trends in College Pricing, on average:

  • At public colleges, state tuition and fees increased 2.9% to $8,893.
  • At public colleges, out-of-state tuition and fees increased 3/1% to $22,203.
  • At private colleges, tuition and fees increased 3.8% to $30,094.

Accommodation and food, books and school materials are also provided. The latter alone is estimated to cost about $1,200 at public colleges and $1,244 at private schools.

In other words, we’re talking about a lot of money here, and costs keep rising. Nevertheless, studying and debt do not necessarily have to go hand in hand. Choices and bargains are out there, especially when it comes to government tuition. Going public, not private, also makes a lot of sense.

For example, check out these three Pennsylvania universities and their 2013-14 tuition fees:

  • Bloomsburg University: $6,622 (domestic); $16,556 (Out of State)
  • Penn State University: $16,992 (instate); $29,556 (Out of State)
  • University of Pennsylvania: $40,594

you get the picture

Thanks to Carol Josel | #College #Skyrocketing #Costs #Student #Debt #BudgetWise #Choices

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