The Student Debt Crisis: Explained

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Student loans are financial tools that have been put in place to give promising individuals the ability to get an education and increase their potential for future earnings with a strong professional career.

On a nationwide level having a well educated and skilled workforce is one of the strongest determinants of economic success. We have seen this time and time again with nations like South Korea, Japan, Switzerland and Germany, who are not necessarily blessed with a wealth of natural resources or great geography but nonetheless hold their own as some of the world's wealthiest nations.

For all of these reasons, young men and women from around the world have grown up with the idea that their education is the best investment they can make…

... but is it?

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[EconomicsExplained]

Last time I was this early I could get a masters degree for $20 and a case of beer.

[bobchannell]

Face it, as student loans became available, colleges found they could raise their prices by a higher percent every year.

[TheDhammaHub]

Once you guarantee unlimited credit to students, universities are incentivized to charge unlimited money. In Germany, our student loans are capped at a fixed amount and universities are forced to charge accordingly. Hence, no crisis!

[tallperson]

When I was in undergrad (~10 years ago) at a top ten public university in the US, I had a buddy who sat on the school's budget committee as a student ambassador. During the course of one meeting, the board voted to 1. stop supplying paper towels to all dormitory restrooms due to budgetary constraints, and 2. raise the salary of everyone on the board by around 15%. Food for thought.

[vincentstewart]

Colleges and Universities would not necessarily need to be “harder” to get into, we would just need to stop trying to coerce every high school graduate into going to college and stop using post-secondary education as the only way of defining success

[hydronpowers]

Wages: *stagnates for decades*
College tuition: *blows out of proportion*
Also College: _WhY cAn'T yOu AffOrD cOllEgE?_

[FingeringThings]

Even though school is online now we still gotta pay the same ridiculous amount

[leogalante]

There was this TV show where someone said "Grandma told me I could get a job now and pay off all my tuition" the dude next to him said "when your grandma was your age a summer job could get you through college" he wasn't wrong.

[plapin]

17 year old with no credit, No income, no plan? Here’s $50, 000!

[pettermortensen]

“A country cannot run entirely on pushing numbers around”. Swiss bankers: «Hold my goldbar»

[mraaronhd]

Here’s what I’ve learned from my own college experience: don’t go to college when you have no idea what you want to do with your degree. My current job has nothing to do with my study field (bachelor’s in history), and I hated working in the field that my degree was in (teaching). I didn’t know what I wanted to do with my life, but I know I didn’t want to work a blue-collar job. Now, I work a blue-collar job. Ironic really.

[bubblybreeze]

Your options are go to college, join the military, learn a trade, have connections, or do illegal business and don't get caught.

[samuele]

Never closed my chemistry book so quickly

[marka]

In all of this, universities have no real incentive to give a quality education. Either the student or taxpayer will bear the burden. Their main focus will be to fill the seats. This ends up predatory practices where naive students are hooked into "college education". So, professors and staff are given recruitment bonuses and incentives rather than quality of education bonuses. Most departments only reward "growing" their classes and department. It is very hard to measure price/benefit for most universities. University paint a rosier picture of their alumni and corporations that hire are tight-lipped about what they think of universities and say they judge on an individual level.

[zalmute]

In my local area, it was drilled into our heads that you had to go to college or you were doomed to Factory Work. I really wish they pushed trade schools and other means as hard as they did college as those are really great alternate paths to success.

[MattRoszak]

I think the most dangerous part about student loans is giving a kid with no financial education/experience a $50k loan that they can never get out of paying.
And yeah, 18 year-olds are still children when it comes to personal finances. Plus at that age you very likely have no idea what you want to do with the rest of your life!

[seawingo]

As a Norwegian student attending University, I still need a loan, albeit to cover living costs and the tiny $50 semester fee.

If I pass my exams and don't drop out, 40% of my student loan will be converted from loan to scholarship. So in essence, I only pay 60% of my loan back. 🇧🇻

[ultrascreens]

When you realise you are paying taxes to the same people who create the money out of thin air, loan it to you at an interest, then tax you on any profits you make...

[alexanderstark]

Speak for yourself buddy, I’m gonna make so many baskets that I’ll single handedly pay of the 1.6 trillion