[PAULYPOKER]

U.S. colleges such as Boston University are using financial aid to lure rich students while shortchanging the poor, forcing those most in need to take on heavy debt, a report found.

Almost two-thirds of private institutions require students from families making $30,000 or less annually to pay more than $15,000 a year, according to the report released today by the Washington-based New America Foundation.

The research analyzing U.S. Education Department data for the 2010-2011 school year undercuts the claims of many wealthy colleges that financial-aid practices make their institutions affordable, said Stephen Burd, the report’s author. He singled out schools -- including Boston University and George Washington University -- that appear especially pricey for poor families.

“Colleges are always saying how committed they are to admitting low-income students -- that they are all about equality,” Burd said in a phone interview. “This data shows there’s been a dramatic shift. The pursuit of prestige and revenue has led them to focus more on high-income students.”

The New America Foundation is a nonprofit, nonpartisan public policy institute. Its president is Steve Coll, a former Washington Post managing editor who will become dean of the Columbia University Graduate School of Journalism in July. Its chairman is Eric Schmidt, executive chairman of Google Inc. (GOOG), the Mountain View, California-based search-engine company.

To increase their standing on college rankings, more private colleges are giving “merit aid” to top students, who are often affluent, while charging unaffordable prices to the needy, according to the report.

The percentage of students receiving merit aid jumped to 44 percent in 2007-2008 from 24 percent in 1995-1996, the report found. To a lesser extent, public universities are using some of the same practices, Burd said.

Boston University charges students whose families earn $30,000 or less an average “net price” -- or costs after scholarships -- of $23,932 and George Washington University, $14,670, the report said. Both offer merit scholarships, which aren’t based on need, according to their websites. Bloomberg


FACTS & FIGURES


The idea of going to college - and the expectation that the next generation will be better educated and more prosperous than its predecessor - has been hardwired into the ambitions of the middle classes in the United States. But there are deep-seated worries about whether this upward mobility is going into reverse. BBC

Andreas Schleicher, special adviser on education at the Organization for Economic Co-operation and Development (OECD), says the U.S. is now the only major economy in the world where the younger generation is not going to be better educated than the older. BBC

At $1.1 trillion, according to the Consumer Financial Protection Bureau, outstanding student loan debt is the largest consumer debt class after home mortgages. Financial regulators, the U.S. Treasury and the New York Fed have all warned about the possible danger student loans pose to financial stability and the broader economy. The Huffington Post

Policy makers on the Federal Reserve’s interest-rate setting panel have identified high student debt burdens as a risk to economic growth, adding to a growing chorus of government officials concerned about households’ education borrowings. The Huffington Post




AHT/ARAUS colleges soaking poor students

[PAULYPOKER]

[PAULYPOKER]

Report: Student debt a 'roadblock' for wider economy



Crushing student debt is not only killing dreams, it's hurting the broader economy.

The Consumer Financial Protection Bureau (CFPB) is warning of the "potential domino effects" to the economy of high student debt. A just-released report from the consumer watchdog highlights the ways this debt can deplete savings, limit spending, and shape choices about a graduate's career path and where to live.

"College can open up many opportunities, and we do not want that college degree to become more of a burden than a blessing for those saddled with unmanageable debt in a tough employment market," said CFPB director Richard Cordray in a statement. "So we are concerned that unmanageable student loan debt may be harmful to recovering consumer markets and may be dragging down borrowers' lives."

The average amount of student loan debt for the Class of 2011 was $26,600, a 5 percent increase from approximately $25,350 in 2010, according to The Project on Student Debt.

In February, the consumer bureau asked for suggestions on ways to encourage affordable repayment options for those with existing student loans. It received more than 28,000 comments from borrowers, lenders, businesses and government officials.

An analysis of these comments found several major areas of concern.

Housing: Student debt may reduce home ownership by limiting the borrower's ability to qualify for a mortgage or even save for a down payment. This is troubling because first-time home ownership stimulates the economy and makes it possible for existing homeowners to "move-up" to another house.

Small Business Development: Outstanding student loans can limit a graduate's ability to save enough capital to start a small business or access small business loans.

Retirement Savings: Student loan payments can divert cash from retirement savings. The CFPB cites recent research that shows only half the workers under age 30 have enrolled in their employer's 401(k) plan and barely 40 percent contribute enough to receive a full employer match. Graduates may need to rely on their parents, who are nearing retirement age, to help pay their debt.

Rohit Chopra, the CFPB's student loan ombudsman, told NBC News the comments show student loan debt is having a negative effect on how millions of people live their lives.

"Many borrowers expected their college education to be a vehicle to a better life," Chopra said. "College graduates do earn more money than those who do not have a college degree, but for those with heavy levels of student loan debt it might mean a more difficult time buying a car, simply to get to work. If their credit is hurt, it might mean they won't pass employment verification checks to get that job in the first place."

Hopefully, things will get better as the economy recovers and graduates are able to get better-paying jobs that let them pay off debt. But right now, Chopra said, "many borrowers, particular those with private student loans, are struggling." CNBC

FACTS & FIGURES

Andreas Schleicher, special adviser on education at the Organization for Economic Co-operation and Development (OECD), says the U.S. is now the only major economy in the world where the younger generation is not going to be better educated than the older. BBC

At $1.1 trillion, according to the Consumer Financial Protection Bureau, outstanding student loan debt is the largest consumer debt class after home mortgages. Financial regulators, the U.S. Treasury and the New York Fed have all warned about the possible danger student loans pose to financial stability and the broader economy. The Huffington Post

U.S. colleges such as Boston University have been using financial aid to lure rich students while shortchanging the poor, forcing those most in need to take on heavy debt, a report found. Bloomberg

Almost two-thirds of private institutions require students from families making $30,000 or less annually to pay more than $15,000 a year, according to the report released Wednesday (May 8) by the Washington-based New America Foundation.

To increase their standing on college rankings, more private colleges are giving “merit aid” to top students, who are often affluent, while charging unaffordable prices to the needy, according to the report. Bloomberg

Moreover, new college graduates face a downbeat labor market. The unemployment rate for workers under age 25 with at least a bachelor's degree has averaged 8.2 percent, compared to 5.4 percent in 2007. Business Week



AHT/DT

[PAULYPOKER]

Colleges stealing from poor students to fund the rich




Low-income students are increasingly bypassed when colleges offer applicants financial aid, as schools compete for wealthier students who can afford rising tuition and fees, according to a public policy institute's analysis of U.S. Department of Education data.

The study by The New America Foundation said that colleges, in their quest to advance their U.S. News & World Report rankings, are directing more financial aid to high-achieving applicants in a bid to elevate the profile of their student population.

"A lot of them (colleges) go for the same students from the rich suburban schools," said Stephen Burd, the foundation's education policy analyst who studied the data.

The U.S. News rankings of colleges and universities have become a popular gauge of the quality of an undergraduate and graduate institution's education and the prestige of its degrees.

As part of their strategy to compete for the best students, colleges use merit-based aid, which does not take into account financial need. Under this strategy, institutions may, for instance, give four $5,000 awards to lure four wealthy students rather than award $20,000 to one needy student, the organization said.

While the federal government issues guidelines on distribution of its grants, it doesn't regulate aid from an institution's coffers. Colleges have fiercely fought efforts by lawmakers to force greater transparency in financial aid practices.

Colleges, many under tighter budgets as they offer more amenities and hire the best professors, are under pressure to raise revenues and are using tuition prices to do so.

The cost of attending a four-year public institution has gone up by 5.2 percent each year in the last decade, more than the inflation rate, according to the Consumer Financial Protection Bureau, forcing more students to take out loans to pay for tuition and fees and giving them a heavy debt burden when they graduate.

The annual cost for tuition, room, board and fees at many private colleges is between $30,000 and $45,000 a year.

Net cost of college

The New America Foundation analyzed net price data - the amount students paid after all grant aid was exhausted - to conclude that hundreds of colleges expect the neediest students to pay an amount equal to or even greater than their families' yearly earnings.

For instance, of the 479 private, nonprofit colleges examined, 89 percent charged students with family incomes of $30,000 or less more than $10,000 in net prices and 22 percent expected students to pay about $20,000 or more each year.

Needy students then rely more heavily on student loans, either drop out or take on full-time jobs, which diminishes their chances of completing school, the study said.

"I fear that we're going to have more social stratification and there are going to be fewer opportunities for upward mobility," Burd said.

While the practice is more predominant in private colleges, Burd said, it is increasing in public colleges, many of which are receiving less money from cash-strapped state governments.

But some schools, such as private Amherst College and Massachusetts Institute of Technology, have enrolled more lower-income students without jeopardizing their prestigious status.

There is nothing illegal about this approach to doling out aid, Burd said, but it undermines the strides made in creating opportunities for the nation's needy.

Burd proposed a carrot-stick solution in which institutions that admit more low-income students receive more federal aid and those that enroll fewer low-income students but charge them higher net prices would be required to match a share of the Pell Grant aid they receive.

Pell is a federal program granting aid to bright low-income college students.

"We've wanted as a country for the last 50 years or so to try to help lower-income students move themselves up the ladder of opportunity, and higher education has always been that kind of ladder. And so the idea that we may be closing these gates is very alarming," he said.

AT/HJ

[SamDiamond]

No one is "forcing" a college kid to attend a private school.

Here's a clue.

GO TO A FUKIN STATE SCHOOL IF YOU CAN'T AFFORD A PRIVATE SCHOOL EDUCATION.

[PAULYPOKER]

Obama administration reaps $51bn profit off student loans



The Obama administration is forecast to turn a record $51 billion profit this year from student loan borrowers, a sum greater than the earnings of the nation's most profitable companies and roughly equal to the combined net income of the four largest U.S. banks by assets.

Figures made public Tuesday by the Congressional Budget Office show that the nonpartisan agency increased its 2013 fiscal year profit forecast for the Department of Education by 43 percent to $50.6 billion from its February estimate of $35.5 billion.

Exxon Mobil Corp., the nation's most profitable company, reported $44.9 billion in net income last year. Apple Inc. recorded a $41.7 billion profit in its 2012 fiscal year, which ended in September, while Chevron Corp. reported $26.2 billion in earnings last year. JPMorgan Chase, BkofAma, Citigroup and Wells Fargo reported a combined $51.9 billion in profit last year.

The estimated increase in the Education Department's earnings from student borrowers and their families may cause a political firestorm in Washington, where members of Congress and Obama administration officials thus far have appeared content to allow students to line government coffers.

The Education Department has generated nearly $120 billion in profit off student borrowers over the last five fiscal years, budget documents show, thanks to record relative interest rates on loans as well as the agency's aggressive efforts to collect defaulted debt. A spokesman from the Education Department did not respond to a request for comment. A Congressional Budget Office spokesman could not be reached for comment after normal business hours.

The new profit prediction comes as Washington policymakers increasingly focus on soaring student debt levels and the record relative interest rates that borrowers pay as a potential impediment to economic growth. Regulators and officials at agencies that include the Federal Reserve, Treasury Department, Consumer Financial Protection Bureau and Federal Reserve Bank of New York have all warned that student borrowing may dampen consumption, depress the economy, limit credit creation or pose a threat to financial stability.

At $1.1 trillion, student debt eclipses all other forms of household debt, except for home mortgages. It's also the only kind of consumer debt that has increased since the onset of the financial crisis, according to the New York Fed. Officials in Washington are worried that overly indebted student borrowers are unable to save enough to purchase a home, take out loans for new cars, start a business or save enough for their retirement. The Huffington Post

FACTS & FIGURES

The Consumer Financial Protection Bureau (CFPB) has warned of the "potential domino effects" to the economy of high student debt. A just-released report from the consumer watchdog highlights the ways this debt can deplete savings, limit spending, and shape choices about a graduate's career path and where to live.

The average amount of student loan debt for the Class of 2011 was $26,600, a 5 percent increase from approximately $25,350 in 2010, according to The Project on Student Debt.

Student debt may reduce home ownership by limiting the borrower's ability to qualify for a mortgage or even save for a down payment. This is troubling because first-time home ownership stimulates the economy and makes it possible for existing homeowners to "move-up" to another house. CNBC

U.S. colleges such as Boston University have been using financial aid to lure rich students while shortchanging the poor, forcing those most in need to take on heavy debt, a report found. Bloomberg

Almost two-thirds of private institutions require students from families making $30,000 or less annually to pay more than $15,000 a year, according to the report released on May 8 by the Washington-based New America Foundation.



ISH/HJ

[PAULYPOKER]

Originally posted on 04/17/2013:
We are all simply pawns in this world : Nominated Post

Yes he is Hypocrite,but he is bold enough to tell the truth, knowing full well, the education $$$$$ machine can not be stopped............

College expansions and new, are being built all around the country as we speak......

It is the new industry of the corporate hoax, draining the youth dry,enslaving them for life,by new world design.............

The youth will learn to accept any slave job offer, given to them, with great gratitude...........

BOOMSTICK!!!

[PAULYPOKER]

13 states where student loan debt is crushing college grads



The mountain of U.S. student loan debt is getting taller and taller, and more and more students are falling behind in their payments, according to a recent study.

The number of students who are at least 90 days late on student loan payments has increased to 11.7 percent, up from 8.5 percent in 2011, according to a recent study by the Federal Reserve Bank of New York. When you don't include people who have deferred payments through various programs, delinquency rates may actually be as high as 30 percent, according to an separate study by the New York Fed.

There is a significant gap between states with the highest average student loan delinquency rates and those with the lowest. While South Dakota has a delinquency rate of just over 6.5 percent, West Virginia's is approaching three times that. Another 12 states have delinquency rates over 13 percent.

U.S. students face a total of $986 billion combined debt, a growing problem that now threatens to create a significant drag on the economic recovery. And that debt is wreaking major havoc on young adults, who already face low employment, causing their debt burdens to be even more inescapable. Partly as a result, Sen. Elizabeth Warren (D-Mass.) has called on Congress to lower the interest rate on education debt.

Here are 13 states where student loan delinquency rates are higher than 13 percent, as of Dec. 31 2012:

1. Nevada
2. Idaho
3. Arizona
4. New Mexico
5. Texas
6. Oklahoma
7. South Carolina
8. Rhode Island
9. Arkansas
10. Mississippi
11. Florida
12. Louisiana
13. West Virginia
Huffington Post
DT/DT

[PAULYPOKER]

Student loan program aimed at ‘attracting votes’

The Obama administration is forecast to turn a record $51 billion profit this year from student loan borrowers, according to Congressional Budget Office.

Many American students are simply fed up with their debt especially in these hard economic times when they cannot find a job to pay it back.

Paul Sheldon Foote, Professor of Accounting at California State University, Fullerton told us in a phone interview that “the fact that many former students are unable to repay their loans” shows that the program was started more for the “purposes of attracting votes”.

Student loan program has been totally designed and executed for large groups of students who want to go into poor majors at bad universities so these students have received money that cannot possibly pay back, he further explained.

“It would have been far better if the money had been directed at those majors such as high technology or medical majors where people are truly needed,” he added.


FACTS & FIGURES

The mountain of U.S. student loan debt is getting taller and taller, and more and more students are falling behind in their payments, according to a recent study.

The number of students who are at least 90 days late on student loan payments has increased to 11.7 percent, up from 8.5 percent in 2011, according to a recent study by the Federal Reserve Bank of New York. When you don't include people who have deferred payments through various programs, delinquency rates may actually be as high as 30 percent, according to an separate study by the New York Fed. Huffington Post

The cost of attending a four-year public institution has gone up by 5.2 percent each year in the last decade, more than the inflation rate, according to the Consumer Financial Protection Bureau, forcing more students to take out loans to pay for tuition and fees and giving them a heavy debt burden when they graduate. Huffington Post

The annual cost for tuition, room, board and fees at many private colleges is between $30,000 and $45,000 a year. The Huffington Post

The Consumer Financial Protection Bureau (CFPB) is warning of the "potential domino effects" to the economy of high student debt. A just-released report from the consumer watchdog highlights the ways this debt can deplete savings, limit spending, and shapechoices about a graduate's career path and where to live. CNBC

The average amount of student loan debt for the Class of 2011 was $26,600, a 5 percent increase from approximately $25,350 in 2010, according to The Project on Student Debt. CNBC

Moreover, new college graduates face a downbeat labor market. The unemployment rate for workers under age 25 with at least a bachelor's degree has averaged 8.2 percent, compared to 5.4 percent in 2007. Business Week



DT/DT

[BuddyBear]

College has to be the biggest sham ever. Imagine having a business where everybody believes they have to buy your "product" because they have been told that over and over all their life, only to realize that your product is, for the most part, useless.

[chilidog]

Pauly's just upset because he was denied for student loans.

[SamDiamond]

College has to be the biggest sham ever. Imagine having a business where everybody believes they have to buy your "product" because they have been told that over and over all their life, only to realize that your product is, for the most part, useless.

There is some truth to that.

Everything I learned, I learned on the job. I'm pretty sure that applies to Investment Bankers, Marketing Analysts etc as well.

There are exceptions of course-- Engineers, Physicans, and Research Scientists, but for a large percentage of college kids, you're right. They are not getting a return on their tuition.

[newguy]

There is some truth to that.

Everything I learned, I learned on the job. I'm pretty sure that applies to Investment Bankers, Marketing Analysts etc as well.

There are exceptions of course-- Engineers, Physicans, and Research Scientists, but for a large percentage of college kids, you're right. They are not getting a return on their tuition.

Its a weed out process for large companies. I work for a big 4 accounting firm - we basically only actively recruit at top tier schools because we know the caliber of the product we will get from them. Same as a manufacturing plant sourcing product from a reputable supplier. Lower odds of making a mistake when you go for that level of person. Not to say a college degree is the only way in here, but we start our first years at about $65k I think - its around there anyway. So if you want to work for us and make that money out the gate, you gotta pay the price of admission. That is why there is still a big business for colleges. There are thousands of companies who hire tens of thousands of undergrads every year. Our start class this year was around 500 kids in my part of the business alone. Guessing across the company we hired 2000 kids last year - all college grads who graduated in June of last year. I don't think there are a whole lot of people here saying they aren't getting a return on their investment.

That said - I have a sister who is a teacher - she will never hit a true break even when you factor what she could make without a college degree. so it depends on your profession

[PAULYPOKER]

Pauly's just upset because he was denied for student loans.

Like I said, you are god awful at Trolling........

[PAULYPOKER]

San diamond is a complete dumb ass ghost troll and should be ignored at all costs.......

[chilidog]

San diamond is a complete dumb ass ghost troll and should be ignored at all costs.......

You're doing a pretty horrible job at ignoring him...

[PAULYPOKER]

At universities, too, the rich grow richer


Although many Americans believe their universities are places where administrators and faculty members coexist on a fairly equal basis, the reality is that this is far from the case.

According to recent surveys by the Chronicle of Higher Education, 35 private university presidents and 4 public university presidents topped $1 million in total earnings during the 2011-2012 fiscal year. Among the public university presidents, Graham Spanier of Pennsylvania State University received $2.9 million for that year, followed by Jay Gogue of Auburn University ($2.5 million), E. Gordon Gee of Ohio State University ($1.9 million), and Alan Merten of George Mason University ($1.9 million). Overall, the presidents of public universities - the poor relations of their private university counterparts - had a median annual total compensation of $441,392.

This very substantial income does not include many additional perks. According to the New York Times, President Gee is known for “the lavish lifestyle his job supports, including a rent-free mansion with an elevator, a pool and a tennis court and flights on private jets.”

Moreover, despite hard times, including pay cuts, for many Americans, university presidents are rapidly increasing their income. President Gogue’s annual earnings soared from $720,000 to $2.5 million in a single year. Between 2010-2011 and 2011-2012, the number of public university presidents in the $600,000 to $700,000 income range jumped from 13 to 28.

Of course, it might be argued that they “earned” these hefty incomes through superior performance on the job. But is this true?

President Spanier, whose $2.9 million income in 2011-2012 made him the best-paid public university president in the United States, resigned his post in November 2011. His resignation came five days after the arrest of Jerry Sandusky, the Penn State assistant football coach, on child sex abuse charges - charges that sparked nationwide outrage over that university’s failure for nearly a decade to alert law enforcement authorities to alleged sexual assault on campus. Spanier was himself charged criminally in an alleged cover-up of Sandusky’s crimes, although he continues to maintain his innocence.

In most cases, however, the bloated incomes of university presidents result from their fundraising prowess. President Gogue, whose $2.5 million compensation placed him second to Spanier, was lauded by Auburn University officials for his close relationship with business leaders. “In basic financial terms,” a university spokeswoman explained, “the return on investment is remarkably high.” Similarly, Hollis Hughes, Jr., the president of Ball State University’s board of trustees, justified the huge income of Jo Ann Gora, the university president - who, at just under $1 million income placed fifth in the financial ranking of public university presidents in 2011-2012 - on the basis of her success at fundraising.

Cultivating corporate and wealthy donors, of course, has long been a major task of university presidents, but it has become an obsession in recent years, especially as state governments have cut back funding for public universities. The nation’s largest public university system, the State University of New York, has gone from a situation in which the state paid 75 percent of the university’s costs and student tuition paid 25 percent to exactly the reverse, in which state support covers 25 percent of costs and student tuition covers most of the remainder. In these circumstances, public universities are desperately seeking to attract financial support from corporations and the wealthy, with obvious consequences when it comes to rewarding the top fundraisers and setting campus priorities.

Meanwhile, faculty members are left out in the cold. Despite the fact that most faculty at public universities have many years of graduate education, doctoral degrees, publications, and years of teaching experience, their average annual salary is just over $80,000 per year. These, of course, are the full-time, “regular” faculty. Part-timers, a talented but cheap labor force who administrators are increasingly substituting for full-timers, are paid, at best, a few thousand dollars per course. Thus, even when they shuttle from campus to campus, cobbling together the equivalent of a full course load, they are so impoverished that they qualify for food stamps. These part-timers and other “contingent” faculty - educators in temporary positions without job security- today constitute the vast majority of those who teach at American colleges and universities.

Nor do faculty salaries seem likely to rise very much. At the State University of New York, the faculty and professional staff are now voting on a new, five-year contract with the state that will provide them with a salary raise of about 1 percent a year - a raise that, when inflation is taken into account, will actually give them a salary reduction. Although United University Professions, their faculty/professional staff union that engaged in lengthy contract negotiations with the state, fought until the end for a minimum salary for part-time faculty, state negotiators - loyal to Governor Andrew Cuomo’s hostile approach to public sector workers - adamantly refused to consider it. Consequently, although top administrators can (and will) be paid increasingly outlandish amounts, there will be no salary floor for those who do the teaching and research.

On university campuses, it seems, everyone is equal. But some are much more equal than others.

ISH/KK

[PAULYPOKER]

The staggering cost of America’s youth unemployment problem




America has a youth unemployment problem, and it’s not just the kids who are suffering.

The nation is poised to lose $18 billion in wages over the next decade due to high youth unemployment, according to a Bloomberg Brief from Bloomberg Senior Economist Joseph Brusuelas.

Brusuelas estimated that about 1.3 million 16- to 24-year-olds have been unemployed for six months or more. He came to the $18 billion figure using earlier research, which found six months of joblessness at age 22 results in a wage that’s 8 percent lower at age 23, 6 percent lower at 26 and 4 percent lower at 30. Still, the problem of lost wages due to unemployment could actually be much worse, Brusuelas told The Huffington Post.

“It’s a conservative estimate,” he said. “That really underestimates the true nature of the problem. My gut tells me that it’s much larger.”

Indeed, Brusuelas wrote in the note that if all of America's 3.2 million unemployed youth stay jobless for an extended period, the U.S. will lose $44 billion over the next decade.

Though Americans of all ages suffered as a result of the Great Recession, the downturn dealt a particularly harsh blow to young people, as employers opted for suddenly plentiful workers with more experience. As a result, nearly half of the nation’s unemployed are under 34 years old, according to an April report from public policy organization Demos.

The fast food industry illustrates one particularly stark example of the downturn's toll on young people's job prospects. Ten years ago, one-quarter of fast food jobs went to teens. Now, that total is just 16 percent, according to a recent article from NBC News.

Additionally, many of the nation’s young people who are employed are working jobs that they’re overqualified for. More than 40 percent of college graduates in the last two years are working in jobs that don’t require a degree, according to a recent report from Accenture cited by CNNMoney.

But those graduates are still paying for that college degree, and their debt could also be holding back the economy. The level of student debt in America is so high that it could hurt the economic recovery, according to an April report from the Federal Reserve Bank of New York.

AGB/AGB

[PAULYPOKER]

Class of 2013 student debt reaches new heights



Students in the class of 2013 graduated with an average debt load of $30,000, according to an analysis by Mark Kantrowitz, publisher of FinAid.org. Adjusted for inflation, that's roughly double the average amount of debt students graduated with 20 years ago.

A separate study released Thursday by Fidelity Investments painted a bleaker picture. The class of 2013 carried an average of $35,200, Fidelty's study found, which includes CC debt and money owed to family members. Half of all graduates with debt said in the survey that they were surprised at how much they accumulated.

"The number of graduates reporting surprise by the level of student debt they have accumulated is a big concern and shows that there is a considerable need for families to better understand the total cost of college," Keith Bernhardt, vice president of college planning at Fidelity Investments, said in a statement.

Outstanding student loan balances has increased to a total of $1.1 trillion, according to the Consumer Financial Protection Bureau. Total student debt nearly tripled over the past 8 years.

Policymakers have warned about the consequences larger student loan burdens could have on the economy as a whole.

The Consumer Financial Protection Bureau believes it will be a drag on the housing market, for example, because newly-minted graduates can't buy homes with their student loan bills. The CFPB recently issued a report urging changes to help borrowers who are struggling to make their payments.

Sen. Kirsten Gillebrand (D-N.Y.) introduced a bill this week that would refinance federal loans to a lower interest rate, saving money for borrowers, but taking away a profitable revenue stream for the federal government. Huffington Post


FACTS & FIGURES


The cost of attending a four-year public institution has gone up by 5.2 percent each year in the last decade, more than the inflation rate, according to the Consumer Financial Protection Bureau, forcing more students to take out loans to pay for tuition and fees and giving them a heavy debt burden when they graduate. Reuters

According to recent surveys by the Chronicle of Higher Education, 35 private university presidents and 4 public university presidents topped $1 million in total earnings during the 2011-2012 fiscal year. Counterpunch

Despite hard times, including pay cuts, for many Americans, university presidents are rapidly increasing their income. Between 2010-2011 and 2011-2012, the number of public university presidents in the $600,000 to $700,000 income range jumped from 13 to 28. Counterpunch

Low-income students are increasingly bypassed when colleges offer applicants financial aid, as schools compete for wealthier students who can afford rising tuition and fees, according to a public policy institute's analysis of U.S. Department of Education data. Reuters

New college graduates face a downbeat labor market. The unemployment rate for workers under age 25 with at least a bachelor's degree has averaged 8.2 percent, compared to 5.4 percent in 2007. Business Week




AHT/ARA

Press TV

[pouyasophy]

Pauly- there's nothing we can do except live our own happy lives. Please stop trying to educate and save everybody. You can only do that with yourself. Live a happy stress-free life. By stressing and posting about this you are driving yourself crazy. Go back to posting those lock threads. If there's a government takeover, a few here at sbr won't be able to stop anyone.

[PAULYPOKER]

Pauly- there's nothing we can do except live our own happy lives. Please stop trying to educate and save everybody. You can only do that with yourself. Live a happy stress-free life. By stressing and posting about this you are driving yourself crazy. Go back to posting those lock threads. If there's a government takeover, a few here at sbr won't be able to stop anyone.

THX for the kind words......

But I have to do this..............

I know too much to sit back and just ignore......

It is now a responsibility on me.......

I'll admit it is a very sad and shitty one,but I must continue forward..........

[SamDiamond]

THX for the kind words......

But I have to do this..............

I know too much to sit back and just ignore......

It is now a responsibility on me.......

I'll admit it is a very sad and shitty one,but I must continue forward..........

You actually think posting on a gambling board is your fuking responsibility?



Can't wait to see that on a headstone--- "Dikface posted videos and internet news stories on SBR".

[PAULYPOKER]

One third of millennials regret going to college



In another indication of how burdensome student loans have become in the United States,about one-third of millennials say they would have been better off working, instead of going to college and paying tuition.

That’s a according to a new Wells Fargo WFC -1.43% study which surveyed 1,414 millennials between the ages of 22 and 32. More than half of them financed their education through student loans, and many say that if they had $10,000 the “first thing” they’d do is pay down their student loan or CC debt.

That’s no surprise when you consider student borrowing topped the $100 billion threshold for the first time in 2010, and total outstanding loans exceeded $1 trillion for the first time in 2011. Student loan debt now exceeds CC debt in the U.S. which stands at about $798 billion.

Delinquencies are also on the rise. The number of borrowers who are at least 90 days late on student loan payments has jumped from 8.5% in 2011 to 11.7% today, according to a study by the New York Federal Reserve.

The problem sometimes is that not all college educations are worth their cost since they can’t guarantee a high-paying job to help pay off that student debt.

A report from the National Association of Consumer Bankruptcy Attorneys says the rising student debt problem can have a bad impact on the economy. Even in the best of economic times when jobs are plentiful, young people with considerable debt burdens end up delaying life-cycle events such as buying a car, purchasing a home, getting married and having children.

The other problem on student debt is a lack of financial education. The first major financial decision many students are making is with their college loans. It’s a major decision and often times there’s been little financial education, if any, that’s been taught.

The Wells Fargo survey found that 79% of millennial think personal finance should be taught in high school; basic investing, how to save for retirement and how loans work were the top three topics they “wished” they’d learned more about.

The Consumer Financial Protection Bureau found student debt has also affected home ownership in the country. Census data reveals that nearly 6 million Americans ages 25 to 34 lived with their parents in 2011, a sharp increase from 4.7 million in 2007.

The CFPB cited The National Association of Home Builders (NAHB) saying higher student debt burdens “impair the ability of recent college graduates to qualify for a loan.” According to NAHB, high student loan debt has an impact on consumers’ debt-to-income (DTI) ratio- an important metric for decisions about creditworthiness in mortgage origination.

It’s no wonder then that more than half (54%) of millennials from the Wells survey say debt is their biggest financial concern with 42% calling it “overwhelming.” Forbes


FACTS & FIGURES


Students in the class of 2013 graduated with an average debt load of $30,000, according to an analysis by Mark Kantrowitz, publisher of FinAid.org. Adjusted for inflation, that's roughly double the average amount of debt students graduated 20 years ago. The Huffington Post

A separate study released recently by Fidelity Investments painted a bleaker picture. The class of 2013 carried an average of $35,200, Fidelty's study found, which includes CC debt and money owed to family members. Half of all graduates with debt said in the survey that they were surprised at how much they accumulated. The Huffington Post

The cost of attending a four-year public institution has gone up by 5.2 percent each year in the last decade, more than the inflation rate, according to the Consumer Financial Protection Bureau, forcing more students to take out loans to pay for tuition and fees and giving them a heavy debt burden when they graduate. Reuters

According to recent surveys by the Chronicle of Higher Education, 35 private university presidents and 4 public university presidents topped $1 million in total earnings during the 2011-2012 fiscal year. Counterpunch

Low-income students are increasingly bypassed when colleges offer applicants financial aid, as schools compete for wealthier students who can afford rising tuition and fees, according to a public policy institute's analysis of U.S. Department of Education data. Reuters

Moreover, new college graduates face a downbeat labor market. The unemployment rate for workers under age 25 with at least a bachelor's degree has averaged 8.2 percent, compared to 5.4 percent in 2007. Business Week




AHT/HJ

[chilidog]

Ahh yes, let's blame the banks again. Let's not blame the people who chose to go to expensive schools and incur the debt. I went to a state university as an in-state resident. I took out student loans, and it took me a few years to pay those off after school. Why on earth would I have gone to a university that I obviously could not have afforded?

[Dilo]

penetrate the American school system

schools don't pay taxes

[DwightShrute]

"Don't let schooling interfere with your education." - Mark Twain

[PAULYPOKER]

Elizabeth Warren: Instead of helping, government making profit on student loans



Sen. Elizabeth Warren (D-Mass.)


Sen. Elizabeth Warren says the Obama administration and Congress are reaping record profits off federal student loan programs.

“Instead of helping our students, the government is making a profit on student loans,” Warren said of the profit figures during a conference filled with young people. “That is wrong. It is morally wrong. That is obscene.”

“The government should not be making profits off the backs of our students," Warren said.

Senators reached a deal Wednesday that temporarily gave students lower interest rates until the 2015 academic year. However, the students will then find record high rates once they return to campus, according to the Huffington Post.

Based on the new deal, interest rates would rise depending on economic situation up to 8.25% for undergraduates, 9.5% for graduates and 10.5% for parents, while the rates for this fall would be 3.85% for all undergraduates, 5.4% for graduates and 6.4 for parents.

This fall’s new rates are higher than last year. For example, last year undergraduates could borrow at 3.4% depending on their financial needs. Some say the temporary low rates are not very helpful since students do not usually take loans before returning to campus in fall.

Lawmakers are expected to vote on the agreement on Thursday.

The record profits of the federal student loans have surpassed $1trillion in overall debt, according to a regulator.

Warren’s comments are the latest of a wave of lawmakers and regulators criticism on Obama and the Education Department over policies that allow increased student debt and record interest rates.

The new deal would affect two loan programs that is the mostly used loan program known as Stafford loans and the PLUS Loans allocated to graduate students and parents.

The Stafford loans roughly comprise 7 million students. In other words, one quarter of all student loans will be affected. Since the rate has doubled, the average student should pay an extra $1,000 over the life of a loan. A typical student could pay $4,000 more in interest to pay four year’s worth of subsidized loans.

The Obama administration profits $51 billion this fiscal year from the federal student loan program, according to the nonpartisan Congressional Budget Office, as almost all student loans in higher education levels are provided by federal government. The interest students pay contributes to the $1.2 trillion in education debt carried by U.S. families.

Average student debt at the time of graduation has increased by 200% since 1993, a study by Hamilton Place Strategies showed.

[PAULYPOKER]

US government to make $185 billion from new student loan bill




An American student protesting the student debt burden






As student debt continues to grow and millions are struggling to repay their loans, the US government is estimated to reap $185 billion in profit over the next decade from distressed borrowers under an overhaul of the student loan program.

The profit estimate would land the student loan program among one of the 20 most profitable public companies in the world, according to Fortune magazine’s annual list of the world’s 500 biggest companies, The Huffington Post reports.

“Why are we piling on another $715 million of debt onto the backs of our students?” Sen. Barbara Boxer (D-Calif.) said.

Despite strong opposition from liberals, the US Senate approved a bill Wednesday to link federal student loan rates to financial markets. The 81-18 vote, which was endorsed by the White House, could increase the costs of borrowing for US students and their families in the future.

The bipartisan proposal would lower the interest rates on federal student loans to 3.86 percent down from the fixed rate of 6.8 percent under current law but they could increase if the financial market improves as expected.

President Barack Obama supports the proposal and the bill will become law if the House of Representatives, which has already passed a similar measure, approves it.

Democratic senators who opposed the bill argued that the caps the bill imposes on interest rates are too high, putting students at risk.

The caps would be 8.25 percent for undergraduates, 9.5 percent for graduate students and 10.5 percent for PLUS loans, which are additional loans that graduate students or the parents of undergraduates can take out.

Student debt has reached a record of more than $1 trillion and an increasing number of borrowers are defaulting on their debt.

According to a report from the New York Federal Reserve, 17 percent, or 6.7 million of students are in default.