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Students average $26,600 in loans upon 2011 graduation…

November 7, 2012

It took me years to pay off my student loans after I finished school. When my girls (Chesley & Lace) were heading into college I made a deal with them…I would pay for their college and they would have no student loan debt if they did followed my three rules: graduate in 4 years, have an amazing college experience  (whatever that means) and do not get pregnant. I know pretty bossy, but I am their dad and had to say dad things like that. Sadly most college grads leave school with degrees and growing debt.

It’s the latest snapshot of the growing burden of student debt, and it is another discouraging one: two-thirds of the national college class of 2011 finished school with loan debt, and those who borrowed walked off the graduation stage owing on average $26,600 – up about 5% from the class before. And likely an underestimate because this doesn’t include most graduates or for-profit colleges, who typically borrow more than their counterparts elsewhere. Still, while 2011 college graduates faced an unemployment rate of 8.8% in 2011, even those with debt remained generally better off than those without a degree. The unemployment rate for those with only a high school credential last year was 19.1%. In these tough times a college degree is still your best option for getting a job and decent pay, but as debt levels rise, fear of loans can prevent students from getting the education they need to succeed. Students and parents need to know that, even at similar-looking schools, debt levels can be wildly different. and, if they do need to borrow loans, with options like income-based repayments, are the safest way to go.

The latest figures come amid increasing alarm about the sheer scope of student debt nationally, which by some measures has surpassed $1 trillion. Recent government figures show nearly 10% of borrowers of federal student loans in the most recently measured group had already defaulted within two years of starting repayment. The latest TICAS (California bases Institute for College Access and Success) report cites studies that found more than one-third of recent graduates were in positions that did not require a degree, depressing wages though other government figures cited by Georgetown University’s Center on Education and the Workforce put the so-called underemployment rate for young grads much lower – at around 10%. Increasing student debt in a weak economy can be a knockout blow to many considering college. As our economy is recovering, lawmakers must send every signal that college is a good investment. Here are some other interesting facts:

  • Private (non-federal) student loans, which generally have weaker borrower protections but have been diminishing as a source of student borrowing, accounted for about one fifth of the debt owed by the Class of 2011
  • Debt levels vary widely by state, ranging from $17,250 in Utah to $32,450 in New Hampshire.
  • Debt at individual schools range from $2,150 to $54,900, though not all schools report data.
  • Among colleges, the percentage of graduates with debt range from 12% to 100%. At 65 schools (poled) more than 90% of students graduated with debt.

I know what it is like to worry about helping your kids through school and the constant thought about how to manage that. I believe that’s just one of the reasons why Gunwel Associates is able to help so affectively. We have been there, we know what it is like and we wish there was someone to help us through these uncomfortable financial issues. So give us a call at 615-730-9444, as we want to help. Perhaps we can come up with  solutions to help you help your kids. Visit our website at www.gunwel.com and come see us soon!

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2 Comments leave one →
  1. November 7, 2012 4:58 pm

    Thanks for your grateful informations, this blogs will be really help for students loan.

  2. November 8, 2012 4:09 pm

    I’m glad it was helpful, Abi…keep reading. Cheers!

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