How U.S. Student Loans Became A $1.6 Trillion Crisis

College is more expensive—and important—than ever before. Some 44 million Americans collectively hold nearly $1.6 trillion in student debt. And these numbers are growing. This decade alone, college costs increased by 25% and student debt increased by 107%. Today, college graduates earn 80% more than those with just a high school diploma. That dichotomy is putting students in a difficult situation: Do they risk going into crippling debt at the beginning of their adult lives in the hope the investment turns into a career financial stability that goes with it?

Some 44 million Americans collectively hold over $1.6 trillion in student debt. And these numbers are growing.

At the same time, advancements in technology, especially automation, are making it harder to earn a living wage without some type of advanced degree. Today, college graduates earn 80% more than those with just a high school diploma, on average.

College is more expensive — and important — than ever before. And that dichotomy puts students in a difficult situation: do they risk going into debt they can’t pay back or miss out on the benefits of a college degree?

Experts have long labeled this dynamic a “crisis.” But then, another kind of crisis hit: the coronavirus pandemic. And then, an economic crisis followed.

In February, the United States officially entered an economic recession and between mid-march and June, over 42.6 million Americans filed for unemployment.

During the 2008 recession, many opted to go back to school and gain new skills. However, since then, the cost of a four-year college degree increased by 25% and student debt increased by 107% and many are less sure if college will be the solution to riding out a recession this time around.

CNBC Make It spoke with students, borrowers, historians and experts to learn how student debt became a crisis, how the pandemic will impact borrowers and who is to blame for putting students in an impossible position.

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How U.S. Student Debt Became A $1.6 Trillion Crisis

[NikhLogic]

College in the US has become a business, not a service.

[tt]

By the time the message hits most students it’s too late. Lack of financial info from parents then the push from school to go ahead and start applying and taking classes early. The pressure is ridiculous

[Squintillions]

Cost of tuition has increased so much in the last 20 years and salary levels have not kept pace with that.

[sameerahmohammed]

Kids take notes:
1. Take AP classes in high school to get college credit.
2. Pick an in state school and live at home if you can.
3. Go to community college if you really need to save money.
4. Apply for as many scholarships and grants as you can.
5. Work while you’re in school if you can.

[zahirsookoor]

America: You have to be 21 and over to buy a can of beer
Also America: You can be a minor and enter this binding contract that leaves you hundreds of thousands in debt

[jellybeans]

Time to remove the stigma of trade schools and community college and transferring, nothing wrong with them parents just want the elitism of university

[Kaizer]

Let be honest, most student don’t event know what is a Interest rate
Until it too late
This is America

[BradThePitts]

Fun Fact! You don't need to go to an expensive school.

[maxmadill]

College have failed America’s youth. It’s a fact.

[JadeTrading]

$1.6 trillion dollars? I learn more on YouTube for free than from my university classes! Crazy! 👀

[driverg]

Jobs should not require a college degree when the requirements obviously don't need one, at least that's how it should be

[ChristianAguilar]

I graduated with a Bachelor's degree debt-free from Cal State Fullerton December 2019. I convinced myself that I would not further my education if I would have to accept student loans. Because of my mindset, I earned 11 scholarships and reached my target.

[downloadgoblin]

Go to community college then transfer to a state university. You don't need to pay $60k a year for a different school name on the same piece of paper.

[MBisFrenchy]

Dorming can be 14-20K per year based on the people I know going to college now. So a lot of the debt isn't the education but the housing.

[gwtgwtv]

I almost couldn’t go to school because I didn’t have a co-signer. I went to a state school I graduated with a bachelor's Degree in Psych and I make 50k but have to pay 850 a month for my student loan payments. I am 80k in debt and at this point I wish I didn’t go. Some days I go hungry because I’m living paycheck to paycheck

[micahwright]

I highly recommend working for two years after high school. It gives you a handle on finances, where you want to be, and what the real world is like. It's not good that kids are thrown into school with the pressure of making a career choice without even dipping their toes into anything.

[FinancialShinanigan]

The glamour of college is slowly starting to fade which is great news.

[TheGuitarGuyCody]

The other issue is that it’s hard to get a job after college. Ridiculous requirements to get started out in your career, even with an internship sometimes it’s not enough experience. That combined with debt is just gonna hurt the overall economy.
Broken system.

[JustineCarissa]

Dave Ramsey entering the chat room. Lol

[MissAbigael]

Upcoming college kids:

Stop going to expensive unis just because you wanna have that college experience. Community college imo is perfectly fine. The professors in community college are just as great, it's just that facilities like library are less great than unis.