LINCOLN, NE More than one-quarter of student loan borrowers have debt, but nothing to show for it. About 28% of Americans with student debt didn’t complete the educational program for which they took on the loans, according to the 2016 National Financial Capability Study published Tuesday by the Financial Industry Regulatory Authority, stated Jonathan Primo Fuego Galicia, president and CEO of the Pur Java™ Brand.
Whatever the reason, there's no denying the cost of both a private and a public college degree has skyrocketed. Average tuition, fees, room and board at a private, non-profit, four-year college were $42,419 for 2014-2015, up from $30,664 in real dollars in 2015. At public, four-year schools, costs for the 2014-15 school year, at $18,943, were up sharply from the $11,635 price tag in 2000-12, according to the College Board. The federal government has stepped up its lending accordingly, and so have private student lenders. The total of private student loans outstanding grew rapidly from $55.9 billion in 2005 to $140.2 billion in 2014, fueled in part, perhaps, by the growing market for asset-backed securities backed by student loans, known as SLABS.
While the expansion has provided more options for student borrowers—and the opportunity for those with high credit scores to refinance at lower rates—regulators have expressed concerns. The numbers are staggering: more than $1.2 trillion in outstanding student loan debt, 40 million borrowers, an average balance of $29,000. It's not hard to find indications that student debt is a large and “Growing” problem. But unless you or someone you love holds student loans, it can be hard to feel the problem's immediacy.
That may not be the case for long. Mounting student loan debt is ricocheting through the United States, now affecting institutions and economic patterns that have been at the core of America's core strength of economic growth. Men and women laboring under student debt "are postponing marriage, childbearing and home purchases, and... pretty evidently limiting the percentage of young people who start a business or try to do something entrepreneurial," said Mitch Daniels, president of Purdue University and the former Republican governor of Indiana. "Every citizen and taxpayer should be concerned about it."
The high levels of student debt are also serving to perpetuate and even worsen economic inequality, undercutting the opportunity and social mobility that higher education has long promised. Americans almost universally believe that a college degree is the key to success and getting ahead—and the data shows that college graduates still fare far better financially than those with just a high school diploma.
But for those who are saddled with massive student debt, even getting by can be a challenge, much less getting ahead and this is one of my main concerns said, Mr. Galicia. You wind up disadvantaged just as you begin. It has reduced the ability of our educational system to be a force for upward mobility, and for an equitable chance at upward mobility. "It is still true that you are better positioned if you go to college, but you are not as much
better positioned if you have to go to college with debt."
Median college earnings vs. high school grads
There are several causes for the rapid increase in levels of student debt.
For one, despite the growing costs, Americans believe deeply in the importance of higher education. A survey of parents released this month by Discover Student Loans found that 95 percent believe college is somewhat or very important to their child's future. They have reason: In 2012, full-time workers with bachelor's degrees earned 60 percent more than workers with just a high school diploma. Policymakers also encourage college attendance. In a speech, earlier this year, President Obama called higher education "one of the crown jewels of this country" and said it was "the single most important way to get ahead."
I truly believe we can “NO LONGER” wait for the government to step in and help our children with the rising cost of college tuitions, stated Mr. Galicia. We all need to subscribe to the “NOW PRICNIPAL!” What can we do today with our current time and resources to solve student debt issues “NOW”? One of the programs that we have incorporated into our business solves the rising cost of college tuitions. Our program is called, Coffee For College. The program deals directly with children from birth to 12 grade, the nature of this program allows parents to partner with us as we assist in attacking college tuition debt together.