Most students go through the rough road of college to hopefully end up with a good job once they graduate. However, reality seems to be rougher these days. Many of these young adults are faced with overwhelming debt as the loan industry refers to them as its “new oil well”.
Millions of Americans have opted for student loans backed by the government. However, more and more borrowers are also falling behind their debt payment. According to data, about 5.9 million Americans are at least a year behind their debit payment.
According to the survey conducted by the State Higher Education Finance, the number of people who have fallen into huge debit has increased by more than a third over the last five years. Many of those who find themselves in incredible financial misfortune opt to default their loans.
Choosing to default is disastrous in many levels. A former student told the New York Times that she had to constantly change her phone number since she has been receiving seven calls every day from debt collectors who are trying to recover her student loan that has long been overdue.
The disaster does not end with the phone calls since there is no statute of limitation when it comes to loan repayments collection. In other words, trying to escape debit is virtually not viable. According to the president of consumer education, those who have incurred debit have to pay for it since an entire industry or the economy itself may suffer in the long run.
At present, the student loan balance all over the country has reached $1 trillion. The new student loan debit now serves as the new hope for the lending industry considering the slow economy has made collection for credit card debit difficult.
In other words, it is a continuous cycle for the lending institutions and for the borrowers. Since hiding from the government is close to impossible, the victor of the cycle is almost always the lenders. People who apply for loans should keep in mind that incurring debit is not a game. You do not just borrow money and expect to get away from it.
Americans are constantly reminded to watch over their expenses. Young people who acquire student loans must learn their responsibility as borrowers at an early age. As difficult as it seems, getting education and eventually a good job is not a walk in the park.
From what the statistics are telling us, the challenge of going through college does not end with the lessons and the long hours of studying. There are plenty of concerns particularly with the finances that need consideration as well.
For many middle-class young Americans, the value of hard work is in college. Millions of college students today balance their time between school, work, and study. Earning extra income to put themselves to college is the best way to get through the difficult times.
While student loans are theoretically helpful, depending on it to survive college is never practical. Students are advised to keep up with their debit payment to avoid paying high interest rate. It is best to stay away from loans as much as possible. However, with the current state of the economy, it is virtually impossible to go through college without debit.
The encouraging thought is that as much as there are millions of young adults in America who have fallen into financial difficulty, there are also millions who have successfully gone through college and acquired good jobs. In other words, the whole process is difficult but not impossible. On top of all these, the best lesson in education is to learn to manage your finances while you are still in college.