A college education is very important. However, with the cost of college tuition on the rise and student debt nearing $1 trillion, many Florida residents are starting to wonder if the debt is worth it -- and if it is -- how to even go about paying back that debt.
When looking at what happened, college tuition continued to rise at a time when the economy was on a serious decline. This, combined with high unemployment rates, meant that many college graduates couldn't even find a job after school in order to pay back student loans. According to Equifax, student loan delinquencies increased 14.6 percent from last year.
Additionally, while we tend to think student debt really only effects the 20-something crowd, it turns out that student loan debt among those between the ages of 35 and 49 has increased by 47 percent. This can be attributed to a number of factors, including people going back to school hoping to improve their chances of employment, to parents who took on the financial burden of sending their child to college.
In fact, about 17 percent of those parents who had a child who graduated from college in 2010 took out a student loan. In the 1992-1993 school year this was only true for 5.6 percent of parents.
All of these financial factors combined, and many wonder just what to do.
For one thing, there are some steps that can be taken beforehand, like maybe going to a state school or a community college before transferring in to a four year college. Then, once a student does graduate, it's a good idea to look into the Streamlined Application Process for Income-Based Repayment Plans to learn more about capping loans at 15 percent of whatever a graduate's disposable income is. In 2014 the cap will drop to10 percent.
Lastly, if student debt is unmanageable, look into bankruptcy. According to the National Association of Consumer Bankruptcy Attorneys, the cost of college has forced a lot of students and parents into bankruptcy. In fact, four-fifths of those attorneys included in the survey reported seeing an increase in the number of clients who have student loan debt.
Source: HLNtv.com, "What you should know about student loans," Alexandra Thomas, June 7, 2012