Newly Graduated And Drowning In Six Figures Of Student Loan Debt

[marmar]

from HuffPost:


Amanda M. Fairbanks
[email protected]

Newly Graduated And Drowning In Six Figures Of Student Loan Debt


NEW YORK -- Hardly a day goes by where Ashley Angello doesn’t fret about her student loan debt.

Angello thinks about it at night, when packing tomorrow's lunch means a few saved dollars. And she worries about it the next morning when deciding what to wear to work, since she hasn’t been able to afford any new clothes since starting her job.

“I used to joke when I was in college that I’d be paying off these loans for the rest of my life,” says Angello, 22. She graduated nearly a year ago from Ithaca College, where she majored in communications. “Little did I realize that I actually will be.”

Angello is on the hook for about $120,000. With six-figures in debt, she has little choice but to save every little bit that trickles in. And still, it's a struggle. ................(more)

The complete piece is at: http://www.huffingtonpost.com/2011/04/26/college-graduates-debt_n_854047.html

[WhiteTara]

1. did they do away with ability to pay

numbers? I was able to choose how much I could pay based on a formula of income/outgo. I paid for many, many years that same amount of money, except when I was out of work and then I was given "forbearance" until I was back at work for 6 months, or something.

[mike_c]

46. I suspect your loans were for considerably less?

My tab for ten years of college and grad school was still only about half what this former student is saddled with, but even with that, I won't be able to pay them off during my working life-- the pay-off period is something like thirty years, but my professional life began in my mid-forties, so unless I work past about 75, there is zero chance that I'll EVER be able to repay, even when they begin garnishing my social security in retirement.

We have a young friend who graduated four or five years ago with a BS in biology and about $125,000 in student loan debt. She works in a retail clothing store now-- permanent jobs in her field are rare and low paying without an advanced degree, and she ALREADY owes more money than she'll likely be able to repay in her working life-- since her loan is in default, the capitalized interest and penalties will quickly grow it into a financial monster. This is a young woman who's talents will likely NEVER be applied to anything more productive than selling consumer goods because she is an indentured servant to her debt. She, like me, will likely spend the rest of her life indentured. At least I got a rewarding career out of it!

This is wrong. I don't care how many folks want to moralize about the ethics of taking on a debt that you haven't a prayer of ever paying-- I'll respond by questioning the ethics of condemning talented and intelligent young people to second class citizenship by preventing them from receiving an education that most other industrialized nations understand is a public good, or of saddling them with unconscionable levels of debt as a condition of realizing their personal intellectual potential. Civilized nations do not treat their citizens like commodities.

[WhiteTara]

49. My loans were. Also, they were government loans

and the interest rate was VERY low. I think what the bankers have done to students is a crime...of course, they won't ever face justice. Your story was shocking about your loan. I can't imagine. When they passed the bankruptcy bill, did they fix it so that student loans weren't eligible?

[mike_c]

51. that's right, it is virtually impossible to bankrupt out of student loans....

It sucks.

[dionysus]

59. i think you can file for hardship and not pay, but the interest still accumulates, so you're still

screwed.

[Mz Pip]

2. Scary stuff

to be saddled with so much debt at such a young age.

My son is 34 and he is thrilled that his student loan debt has finally dropped to below $100,000. That was just graduate school. We paid for his undergrad.

[Liberal_in_LA]

3. Really scary. Unbelievable the amount of debt young people are carrying

[Canuckistanian]

4. Mission accomplished

If you're worried about losing your job and paying bills, you won't complain about the pay or working conditions.

The 1% win again.

[UndertheOcean]

5. Ok , What does "Communications" mean ? sound like a bullshit field.

[Mrs. Ted Nancy]

15. Yep

I found this explanation on a blog.

Attending the usual networking events while searching for a job is something I usually dread. The scene is always the same and the one question always asked of me by some "Shelley Levine in a leisure suit" is, "So, young Christopher, what did you major in while studying at that state-funded, urban concrete university of yours?"

"I was a Communications major," I always respond with a naïve twinkle in my eye.

The generic partygoer usually gasps in horror, "Well, what are you going to do with that?"

Though Communications remains a mystery to the average person, it is nothing to fear or loathe. Communications is, simply put, the art of bullshit. That's right, bullshit. Graduates in the Communications field are paid (yeah, right!) insane amounts of money to talk about, write about, and invent new ways to present bullshit.

http://blogcritics.org/culture/article/what-is-a-communications-major/

Many college football players are communications majors along with sociology.

[tammywammy]

16. I always assumed it meant the person wanted to go into PR or something

But yeah, an easy degree to get.

[Odin2005]

20. It's a "major" for star college athletes and socialite airheads.

[conflictgirl]

22. It really doesn't matter what your major is anymore

I went back to school and finished in 2007 with a double-major in technical writing and sociology. My job prospects weren't great when I graduated - I didn't get any job at all for 8 months and even then it was part time at Starbucks. My husband went back after that and figured he'd learn from my mistake and went for accounting, then (and now) being listed as one of the most employable and in-demand college fields. 14 months after graduating he still has not been able to get a better job - or even an entry-level job using his degree, for that matter. We both have student loans to pay now but neither of us is more employable than we were before we got the degrees.

ETA that FWIW we both went to community colleges for the first 2 years and state universities for the last two. We worked while in school but had to take out loans because our work earnings were to support our household. We made the mistake of having kids before finishing college. Our governor was promoting that college education and "re-training" was the key to getting better jobs, but it wasn't true for us.

[alcibiades_mystery]

55. You didn't get a job in technical writing?

That's odd. It's one of the few growth fields these days.

[RadiationTherapy]

33. Communications is the study of interpersonal theory, persuasion, and many

other aspects of communication both visual and written.

It is an interesting and legitimate field of study.

[snooper2]

42. Mkay...When I hear communications I think...TDM? SIP?

8xx service?

CNAM available?

:rofl:

[jdp349]

66. It is!

I work at one of the major networks in New York and have to work with a lot of communications majors. There is not a single thing they know that I don't that relates to success in our chosen fields. I studied economics, business and political science and it seems my education is of MUCH greater advantage in our field than theirs'.

[LoZoccolo]

70. In some universities, the journalism classes fall within the communications department.

They also study things like how the mass media interacts with society and what-not. I took an introductory communications course and two courses in journalism in college (one that was about how to find sources and another about how to evaluate the information) and they were really enlightening as far as how I look at the mass media and the things delivered by it. I think that a media literacy class that teaches students how to question and evaluate the news and other media should be offered at the high-school level.

[liberal N proud]

6. Know the feeling, our daughter is in the same boat

[aikoaiko]

7. Why would anyone choose to go into so much debt for a bachelors degree?

:shrug:

Don't get me wrong. I think Ithaca College is a great school in a great community, but if you can't afford it then don't go.

Or if you think the education and networking opportunities are so great that you're willing to gamble, then so be it. Gamble away.

edited to add:
Tuition at her hometown community college is 3k per year
Tuition at a nearby SUNY is 6K per year.
Yes there are other expenses, but nothing near the 120K total price tag.

[Bragi]

Education is not just a "private" benefit

You write as though education is a private matter, like what kind of car one wishes to drive. Education, however, is a social good.

Note that most economists now say that the US economy will be even further down the tubes and more uncompetitive if it does not boost the number of highly educated people in the workforce.

And note that democracy, both in theory and in practice, depends upon "an informed electorate" that understands the world around them, one that is able to think critically.

Education may offer benefits to individuals, it is primarily a social good, something that a healthy and prosperous society needs to support and promote.

You'll not hear that from the corporate class or their political shills on the right, but that's the truth.

[aikoaiko]

31. Choosing to go into that much debt when much less costly choices existed is a private matter.

Notice that I did not say she should not have chosen to educate herself. She had much less costly options as I outlined. No one forced her to pay the money for a liberal arts experience.

Her tuition at her hometown community college and nearby SUNY are supported by tax dollars and she chose otherwise.

[Bragi]

35. Fair enough

I probably should have not posted in direct response to your posting. I'm reacting really to the overall tone I see here, which seems to be that education is just a private thing, or even worse, a consumer shopping choice like any other. The idea of education being a social good and something in which society needs to invest seems lost.

[aikoaiko]

36. I agree. States have been cutting their support for state schools, too.

Where I work, 12 years ago the state used to contribute about 75% of the total operational budget and its close to 50% now.

I predict it will be close to 25% in another 10 years. It is sad.

[dionysus]

65. i went to RIT in upstate NY from 96-2000. it was 16k-ish per year when i graduated.

now it's around 30k per year.

i had a 50% scholarship but had to borrow the whole other half.

in certain fields, you need that piece of paper to get hired.

in the SUNY network, maybe evebn RIT too you could get TAP if you came from in state, but me, coming from maine, i couldn't get it.

[RKP5637]

8. The future of our country is being devoured by the 3%ers. Soon none will

even bother with more education, the payback won't be there and being an indentured servant won't be worthwhile. The net/net will be a populace spiraling downward in educational level and standard of living, and impoverishment spiraling upward.

Other countries will take the lead in the 21st century. Most Americans will be working Walmart and fast food jobs, other retail jobs. The real science, engineering and achievements will be done by other countries.

Things change and SH** happens, there is absolutely no guarantee America will hold any edge as other countries grow and prosper more and more, and once the scale tips, it ain't coming back.

[Kalun D]

9. Keeping Up With the Joneses

You go to a community college for 2 years, then on the a regular college for the last 2 years, save a ton of dough. Especially for a lamer major like communications.

Just think if you lived in France, free college education to anyone that can pass the entrance exams.

[alcibiades_mystery]

57. Yeah, but only about 10-15% of today's college students in the US would pass those exams

Maybe that's a good thing. I don't know.

[EmmettKelly]

10. $120,000 for a 4 year degree in communication?

How does someone so dumb get into college in the 1st place?

[marmar]

11. Wow. Just wow.

nt

[LibertyFox]

21. With a loan.

EVeryone gets loans now and they don't seriously consider the long-term costs. We're just told that we need to go to college if we want a hope at a good life.

So more and more people get the loan. Universities raise tuition because they can and people just get more loans. Loaners don't mind because they then own you for years.

It's a nasty cycle and one that will only be replaced when the traditional idea of a college education is destroyed.

[Kingofalldems]

53. Seriously, you can't stay away can you?

[dionysus]

60. did you get a degree in being coldhearted?

[frazzled]

12. Something is wrong with that story

If Ashley demonstrated financial need, the most she would be allowed to borrow as an undergraduate if she were independent of her parents, or a dependent whose parents couldn't qualify for a PLUS loan, is $57,500 over four years. See Federal Stafford loan rules: http://studentaid.ed.gov/PORTALSWebApp/students/english/studentloans.jsp

And no private lender is going to lend this girl $120,000. Maybe her parents incurred this debt. I don't know. But something isn't adding up in this story.

[conflictgirl]

23. Actually that's not true

One of my best friends just finished her degree in PR/Communications from an expensive private university last year. She was a single mom with absolutely terrible credit. She borrowed a little over $125K for her education and had no trouble getting the loans.

Paying them is a different story...she's well on her way to default since she's only making about $25K a year and her lenders want monthly payments of $2000 on the student loans.

[frazzled]

39. I question your story that someone with horrible credit got a $125K loan

I'm sorry, but as someone who put two kids through private universities and had to take out loans (and whose children took out Stafford loans), I know that one's income and credit rating are carefully scrutinized. At least by real banks that qualify for the PLUS loan program. Loan sharks, maybe, will extend that much credit to someone earning $25K a year. But normally, someone couldn't even get a used car loan for $8,000 with an income of $25K and a credit history like that.

Sorry, I stand by my facts.

And it is 100% true that there are maximums to the federal loan program: they simply will not let students take on debt that exceeds a certain amount. Period.

[conflictgirl]

48. Sallie Mae has very few requirements for private loans

Their requirements are not the same as Federal or PLUS loans. I know my friend did get a co-signer for one of her loans but that was because it was far in excess of what she needed for tuition. I also took out a small amount of loans through Sallie Mae to cover the tuition in excess of the federal loans and Sallie Mae gave them to me even though my credit's not great, they just charged a higher interest rate.

I think that's the one thing a lot of people aren't aware of with student loans now: Sallie Mae loans are private and are barely regulated. They will loan large amounts of money to people with much lower credit-worthiness standards than one would get from other types of loans. The average student now graduates with like $25K in debt; how many 22 year olds do you know who can get $25K in credit, let alone much more than that? The only way it's even possible is if private lenders have weaker standards for lending money to students.

Edited to add that with student loans, you're not borrowing $125K in one lump sum. It's in smaller increments - say $12K a semester from private loans plus say $4K from Stafford subsidized and another $6K in unsubsidized - before you know it you get to graduation and have this huge student loan debt. They don't give you a running total of how much you're borrowing. That's up to you to keep track of, but in my experience few students do so.

[tammywammy]

28. She probably did get private loans in addition to Stafford. n/t

[dionysus]

67. could have been a perkins loan. i had a mix of stafford and perkins loans.

[inwiththenew]

13. $120,000 on a communications degree

Wow, they saw her coming.

[tammywammy]

14. I'm sorry, but this is just stupid

Why would you take out that much for a degree that's not an MD or DO? I go to a private university, I take out loans, my total loans when I graduate next year will be $36,000. I supplement with classes at the local community college when I can, and oh I work full time and take a full load.

Maybe she should have gone slower with her education and not taken out so much in loans?

[dionysus]

72. i went to college from 96-2000 and my school was 16k per year at the time. same school now, almost

30k.

my parents were poor and couldn't help me, and even though i got a lot of scholarships i had to borrow 45k over the duration. and worked 30 hours a week the whole time. it was amazingly expensive then, and even worse now. i can't help but feel bad for kids nowadays.

[PatentlyDemocratic]

17. I don't feel sorry for them - they could've gone to a public university like many of us

I had to turn down expensive "elite" private schools and went to a state school instead. It hurt my ego, but I came out debt-free with a fantastic education.

Taking out $120,000 in loans at a private college for a communications degree is irresponsible. They chose ego over common sense. You can't have your cake and eat it too.

[RKP5637]

24. That's what I did too. I went to a top notch state school and also got an

incredible education. Depending on ones profession many state schools are exceptional and very highly rated, unless one needs a calling card of I went to xxx megabucks school. So much of life is pure BS. I try to tune out more and more of the BS each year.

[w8liftinglady]

27. I have to agree. University of Texas has a great college system

...And allowed a single mom with a baby to be able to afford her nursing degree.
I WILL say tuition costs have skyrocketed here,but you can get a batchelor's degree for less than 20K.
My Master's will cost about $12K (but my employer will foot a lot of that)

[alcibiades_mystery]

58. Many state schools are R-1 institutions

You in fact have access to better research resources and more prestigious faculty than you would at a place like Ithaca college. This student could have easily gone to Binghamton University for less than half the cost, for example, and she would have had access to more cutting edge research and faculty. The loans she took out are insane for a bachelors degree.

[snooper2]

44. look at the numbers, Room and board: $11,780 a year

For that should could have bought a SUV and lived in it...

and at least had something to show for it when she graduated :P


Ithaca College
ANNUAL COSTS
City: Ithaca
State: NY
Annual tuition: $32,060

Fees: N/A
Room and board: $11,780
Room only: $6,238
Note: N/A indicates data was not available.

[blueamy66]

47. I didn't go to a private school either. I went to AZ State.

And I let my scholarship, employer and then my union pay my tuition. I got out with 0 debt...with a BS in Justice Studies.

What is with $120k of debt for a private school???? I can't believe it.

[dionysus]

68. how many of you are going to spam this thread?

[JVS]

71. Not all students get into the public schools.

[eridani]

18. And all she needs is opt-out only IRAs to save for her retirement

And to have SocSec eligibility age raised and benefits cut.

:sarcasm: :puke:

[Odin2005]

19. This is why I am determined to NEVER take out a student loan. EVER.

$120,000 in loans for a worthless major? This woman is a moron.

[aikoaiko]

26. Its a good goal to avoid student loans, but it is possible to be smart about them.

Sometimes the degree, the job opportunities, and payments make financial sense, but far too many people just max out what they can take and assume the best outcome will occur.

I've heard different rules of thumb, but the one I like the most is to not take our total loans more than 1/2 of your expected first year's salary. Second only to your rule, never take out student loans.

[Odin2005]

50. In our outsourcing business climate student loan debt almost NEVER makes sense.

[taught_me_patience]

73. Completely untrue

College graduates almost certainly will make more money than high school grads.

[dionysus]

69. with all due respect, you're full of shit.

[MilesColtrane]

25. 30K a year?

I wonder how much of that went to non-educational expenses.

[aikoaiko]

29. Hard to say, but 2011-12 tuition is already set at $35,278 at Ithaca

Even if every penny went to tuition and books, its appears to be a very risky (i.e., bad) economic choice.


http://theithacan.org/10112

[Liberal_in_LA]

54. private universities charging that and more.

[DCBob]

30. That's $120,000 figure does not make sense for a 4-year degree at a college..

Tuition is high but not high. Her living expenses must have been exorbitant.

Also, she should have chosen a degree in the medical or perhaps accounting fields if she wanted a "guaranteed" job.

[aikoaiko]

32. Its very possible that Ithica's tuition, fees, and books cost 30K a yar

We don't know if they partially remitted her tuition or had scholarships, but Ithaca College tuition will be 35K next year.

[DCBob]

34. Wow, that is expensive. I had no idea tuition could be that high.

I would have serious second, third and fourth thoughts about going to college if it cost that much. Thanks for the info.

[jpljr77]

38. It's actually much worse. She only covered a couple of years with loans.

Look at the fifth paragraph in the story:

Midway through college, Angello wouldn't have been able to graduate had she not been willing to go into debt. “I needed that loan no matter how much it was going to cost me in order to get my education.”

"Midway through college," it says. So that means that she had $120,000 in loans for TWO years of college.

Look, I know we're not supposed to blame the "victim," but did she really need to pay $1000+ per month in rent, and go out for $8 drinks and $4 coffees all while not working? Because that's obviously what happened. Tuition and fees are very, very high right now, but not $60k per year.

Another way I know she was covering personal expenses with her loans? Toward the end of the story:

The monthly payments on her private loans....

"Private loans." This means that she borrowed far above the limit on the federal loans, which cover tuition and fees.

Something drastic is needed to rein in rapidly escalating college costs, that much is certain. But students also need to understand that life, even while in college, isn't Jersey Shore, unless your family is rich, of course. You have to live within your means, even during the funnest four years of your life.

[madinmaryland]

37. I want to know why they student and her parents were not talking about this

before she took out these massive loans. Don't people think about this kind of stuff. It just boggles my mind.

My wife got an BA in English Lit from a prestigious east coast private college, and when she left college she had no debt. She, of course, did not live on campus. Her parents are not wealthy, but were able to afford the tuition at the time (30 years ago).

[tammywammy]

40. I agree

I don't know why they're not talking about this. Heck, I was 27 when I went back to school and was going to take out loans and I still discussed it with my parents.

[eilen]

43. 30 years ago was back in the good old days

when one could work all summer and pay your tuition with the earnings and books for the semester rang in at about 2-$300.

[snooper2]

41. 47K of that was room and board...

stupid...

Ithaca College
ANNUAL COSTS
City: Ithaca
State: NY
Annual tuition: $32,060

Fees: N/A
Room and board: $11,780
Room only: $6,238
Note: N/A indicates data was not available.

[cloudbase]

45. Here's an analysis of return on tuition

from various colleges: http://www.payscale.com/education/average-cost-for-college-ROI

[varkam]

52. I owe 100K+ on student loans.

Of course mine's a law degree, but I'm not entirely sure it's worth that much more than a communications degree...

I'll just keep telling myself that they don't have debtor's prisons. At least not yet.

[Blue_In_AK]

56. My daughter will be paying for her law school education

well into middle age.

[leftyladyfrommo]

62. I talked to one graduate in dental school - awful debt.

Her husband is a general practioner doctor and his debt isn't nearly as bad as hers. And he paid $45,000 to buy into a practice.

After school and opening her business she and her husband were almost a million in debt.

She said she would be 45 before they would have any money.

[taught_me_patience]

74. No problem with that

I'm sure her salary bump more than pays for her debt. I'll be paying student loan debt until I'm 60 years old... $550/mo for the next 30 years. I'm making more than $2,000/mo more than prior to the degree. Not all debt is bad.

[Codeine]

61. So don't go to private school, dipshit.

Especially for a pretend degree.

[JVS]

63. I'd like to point something out here. When medical students go deep in debt it's viewed as proof...

that we should kiss their asses when they are done and pay them huge amounts of money, for which they allow us to live. Normally a negotiator who uses such stakes would be called an extortionist. But a communications major or anyone else gets debt and then the debt proves that they're some fucking moron and they deserve everything they get. Why are medical students exempt from the "The debt is your problem, fuck you!" treatment?

[Bill McBlueState]

64. I wish people would lay off the student

We give teenagers almost no financial training and turn them loose to a bunch of banks that will hand out credit cards like they're free hot dogs and issue student loans with little to no evidence of good decision-making skills. Naturally some fraction of these kids are going to find themselves in untenable situations.

College kids make bad decisions -- it's practically their pastime. Should they be given the freedom to make decisions so bad they have to deal with them well into middle age? Maybe the system could be reworked a little to prevent this.