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How U.S. Education Has Become ‘A Debt Sentence’ [Infographic]

Forbes – Niall McCarthy

“America’s student loan crisis still isn’t showing any signs of improvement and according to the National Association of Realtors, 45 million people are carrying student debt with a fifth of them owing $100,000 or more. That’s having an impact on home ownership and the realtors also say that 83 percent of people aged 22 to 35 who haven’t bought a house blame their student debt levels.” (more)

Incremental Steps Toward Bold Student Loan Reforms

Education Next – Sandy Baum and Matthew M. Chingos

“The options available to former students repaying their federal student loans have improved over the past decade. Instead of making equal payments every month for 10 years, 31 percent of borrowers are now in plans that set payments at an affordable share of their incomes and forgive remaining balances after 20 or 25 years. But the system of multiple plans is too complicated and difficult to navigate, default rates remain stubbornly high, and the latest estimates project significant long-term costs to taxpayers.” (more)

The Looming Student Loan Crisis Is Worse Than We Thought

Education Next – Judith Scott-Clayton

“This report analyzes new data on student debt and repayment, released by the U.S. Department of Education in October 2017. Previously available data have been limited to borrowers only, follow students for a relatively short period (3-5 years) after entering repayment, and had only limited information on student characteristics and experiences. The new data allow for the most comprehensive assessment to date of student debt and default from the moment students first enter college, to when they are repaying loans up to 20 years later, for two cohorts of first-time entrants (in 1995-96 and 2003-04).” (more)

College Students Miss Mark on Financial Literacy, Survey Shows

Education News – Raymond Scott

“LendEdu, an online marketplace created to offer student loan borrowers insight into their personal finances and loans without damaging their credit, has released its 2016 College Students and Personal Finance Study — and the results show a high degree of financial uncertainty among college students. The study surveyed current college students on basic personal finance knowledge and tried to gain insight into how they are managing money…In its introduction, the survey acknowledges a general lack of financial literacy in the United Sates. Currently, only 17 states require high school students to take a class in personal finances. Unsurprisingly, the results exhibited students “lacking basic knowledge and confidence” on financial matters…The report makes clear the urgent need for financial literacy coursework…Largely, students are not pulling in high incomes. 27% of students reported that they do not have a source of income, while another 40% of students were working part-time or had an on-campus job. The fact that students are not making much money adds greater emphasis to the need for financial literacy. Students must learn how to make the most of limited funds.”(more)

What’s a degree worth? Depends on what you study — and where

The Washington Post – Nick Anderson

“Given rising costs, high debt and an uncertain job market, questions about the value of a college degree have proliferated. As the debate heats up, remember that, overall, college is a good investment. Even if it isn’t uniformly worth a million dollars, college graduates earn more than high school graduates and they are far less likely to be unemployed. But students need to know that not all college degrees are created equal and that some majors will launch them into the middle class relatively quickly while others might lead to years upon years of camping out in Mom’s basement, driving a beater and struggling to pay off student loans…Luckily…many states are reporting what graduates with different majors at different schools earn.”(more)

Obama to forgive the student debt of permanently disabled people

The Washington Post – Danielle Douglas-Gabriel

“The Obama administration plans to forgive $7.7 billion in federal student loans held by nearly 400,000 permanently disabled Americans. By law, anyone with a severe disability is eligible to have the government discharge their federal student loans. The administration took steps four years ago to make the process easier by letting people who are totally and permanently disabled use their Social Security designation to apply for a discharge, but few took advantage. The Department of Education is now taking it upon itself to identify eligible borrowers and guide them through the steps to discharge their loans. “Too many eligible borrowers were falling through the cracks, unaware they were eligible for relief,” said Education Under Secretary Ted Mitchell in a statement. “Americans with disabilities have a right to student loan relief. And we need to make it easier, not harder, for them to receive the benefits they are due.””(more)