A new report reminds the United States about the impact of student loan debt on students who received their college diplomas during the Great Recession.
The report was compiled by nonprofit research firm RTI International for the National Center for Education Statistics, a federal entity responsible for gathering and analyzing data about education. Specifically, the most recent study involving student debt looked at how debt levels have impacted grads who earned their bachelor’s degree in 2007-2008.
The graduates who didn’t have to borrow money to pay for college were more likely to say that paying for college was worth it. A total of 81 percent of students who didn’t borrow money felt college was worth what they paid, compared to 69 percent of those who graduated with student loans.
Furthermore, the study reaffirmed a long-held idea that student loan debt simply holds back college graduates from moving forward in life, despite having a degree and the ability to pay off student loans.
“From taking an undesirable job to delaying buying a home, students who graduated with high levels of debt during the most recent economic recession report that they are experiencing the impact of their education costs when asked four years after graduation,” said Melissa Cominole, an RTI research education analyst.
When polling the 2007-08 graduates, RTI found that by 2012, 44 percent of borrowers had taken an undesirable job or one outside of their field because of education costs compared to 28 percent of non-borrowers.
When it comes to purchasing a home, 44 percent of borrowers delayed purchasing one, compared to only 23 percent of non-borrowers. Marriage was even impacted by the level of student loan debt, with 26 percent of borrowers delaying marriage, compared to only 14 percent of non-borrowers.
What Can Students Do to Borrow as Little as Possible?
Since quality of life can be affected by how much money a graduate owes as they exit college, it makes sense for students to do what they can to avoid going into student loan debt to begin with. While college costs are soaring, there are things a student can do to reduce their debt burden.
Attending a two-year community college before transferring to a four-year university is a possible way to save money towards a degree. Community colleges are much more affordable for students, particularly colleges within driving distance.
Another way to cut down on college costs is to sign up for a work-study job at the college. That can be easier than finding outside employment because colleges are willing to work around a student’s class schedule to ensure their job doesn’t interfere with their schoolwork.
If this isn’t possible, finding part-time work during school to cover part of tuition or expenses is a way to reduce the need for student loans. At any rate, students should work during summer break to save as much as they can to defray costs.
Last but not least, students should apply for all the scholarships they reasonably can. Scholarships are a prime source of funding and don’t come with any baggage like interest payments. They’re competitive though, so applying often and early is ideal.
Author: Andrew Rombach
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