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More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

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Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#271

Post by astura »

alistairSH wrote: post #62
H1Supreme wrote: post #14

Earlier quoted context omitted.

The amount of people I know with degrees who work in retail, or something completely unrelated is staggering. From my observations, I'd guess "underemployment" is the biggest contributor to the late payments. This is just another example of why I urge any young people I know (high school age) to think long and hard before choosing to go to a 4 year college. When I graduated high school in 99', we were primed to think…

think long and hard before choosing to go to a 4 year college A college degree is still worth a considerable bump in lifetime earnings.[1] Perhaps you should revise your advice to "think long and hard before choosing to go to an expensive 4 year college" or "consider spending the first two years of college at a local community college." 1 - https://trends.collegeboard.org/education-pays/figures-table...

I would be very, very careful making the conclusion college degree leads to lifetime earnings, it's possible that a third (or forth, or fifth, ...) factor that makes people more likely to earn a college degree is what leads to the bump in lifetime earnings.

It is also completely useless to lump together all college degrees from all schools.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#272

Post by indubitable »

tyrw wrote: post #44
fhood wrote: post #37

Earlier quoted context omitted.

Speaking of lessened "value" of degrees, University's need to be held accountable for some of the debt that they are encouraging students to take on. For example, at my public university, STEM students were charges several thousand dollars a year more than humanities students. STEM programs also did their best to discourage enrollment. Meanwhile the anthropology department is literally begging students to stay and ge…

Why should this be the case? They offer a service with hundreds of competing options (other schools), so it's hard to argue they're not offering market rate.

I think the infinite access to loans is destroying any connection between market pricing and desirability. People at the age of 17 or 18 when they're going into college tend to have minimal to no knowledge of the workforce, and tend to be completely unrealistic about their own probable outcomes. More than 50% [1] of Americans under the age of 30 expect to become what they consider "rich." That was from 2003, but it was repeated in 2010 and yielded near identical results. [2] What does an extra $20k/year in debt matter if you're going to be a millionaire in a decade anyhow? When people's views of the value of something is completely out of touch with reality, they are rarely going to be incentivized to make logical decisions.

This feature also makes the entire for profit education industry quite predatory. I realize public institutions are ostensibly not for profit. At the same time, when you have higher executives taking salaries in the millions of dollars, and layer upon layer of redundant administrators with comparably bloated salaries, that they then regularly adjust upwards as "their revenue" increases, that belies the intuition of 'not for profit.' So forgive my colloquial nature.

[1] - http://news.gallup.com/poll/7981/Half-Young-People-Expect-St...

[2] - http://www.bankrate.com/banking/savings/do-you-think-you-wil...

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#273

Post by Chris_Jay »

moftz wrote: post #252
lettergram wrote: post #224

Earlier quoted context omitted.

That's the median starting salary for a lot of places. I was actually speaking to a UPS driver about how that was his starting salary..

UPS drivers don't start out as drivers. You have to work your way up from package handling to get to that point. $25/hr isn't reasonable for any entry level job with no college degree requirement. Even a skilled trade like an electrician still requires training and apprenticeships. You might not be going to college but it's going to take just as long to become a journeyman in whatever trade you are looking at.

I made that as a roughneck straight out of high school. It's not that unusual.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#274

Post by brewdad »

alistairSH wrote: post #268
brewdad wrote: post #87

Earlier quoted context omitted.

One question I have regarding spending the first 2 years in a CC is how does this impact your ability to get admitted to a 4-year school later on, particularly a top-tier (say top 50) university? Are these schools less likely to admit students who will only spend a couple of years there vs students entering straight out of high school, all other things being equal? I don't know the answer, but given my son is on a tr…

tssva is correct, most states have matriculation agreements between the CC system and state college system. So, at worst, you finish your degree at your home states flagship state university (obviously, those vary, but generally, each state has at least one well respected institution). If you're in VA, you "hit the jackpot" and have many choices (UVA, W&M, VT, plus a half-dozen other solid choices). Locally (VA), stu…

Unfortunately, my state's universities are decidedly mediocre. Both flagships sit outside the top 100 nationally. Bordering states do have strong public universities, so I will have to see if there is any reciprocity. Otherwise, it looks like we'll have to do a lot of close examination of the total financial packages being offered when the time comes.

I graduated in the mid-90s with $20k in debt. That wasn't fun but it was manageable. I can't imagine graduating with a mortgage's worth of debt.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#275

Post by eighthnate »

1_2__4 wrote: post #108

I hate sounding both old and weird but I cannot shake the feeling that much of the claims of economic health and growth in the US is... if not fake (I’m not totally nuts) but not accurate. My most charitable interpretation if I’m right is that we’re using the wrong metrics (possibly intentionally) that give a distorted view of the economy. But I keep hearing employment is great, productivity is great, stock market is…

> But I keep hearing employment is great, productivity is great, stock market is great, and yet it seems like most anecdotal evidence I see and read about suggest this is all hollow, and things are actually really bad for the average American.

Stock market and the incredible rebound of housing prices are great if you are older/wealthier and own assets.

There is no denying that if you were wealthy and an asset owner, you did incredibly well.

But if you are young with student loans or an average joe with a few thousand in the 401k, then it isn't going to affect you much.

The years since the financial crisis was primarily about bailing out the big banks and the wealthy asset owners.

If you are an young or an average person, you are doing even worse now since medical costs have increased. The ACA ( obamacare ) was about transferring the burden of medical costs from the elderly and sick to the young and healthy.

If you are older, wealthier and owned a lot of assets, the past 8 years have been the best years of your financial life. The S&P 500 rose from 600s to 2500s and looks to be headed to 3000. Everyone else has fallen behind. Stagnant wages and increasing medical insurance costs.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#276

Post by eighthnate »

Have they looked at the ACA and people having to pay a lot more for insurance now? And service industry moving more towards part-time jobs since they don't deal with full-time employees given the push towards increasing hourly wages to $15?

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#277

Post by Godel_unicode »

rtkwe wrote: post #267
Godel_unicode wrote: post #241

Earlier quoted context omitted.

This isn't the 1850s, UMD essentially competes with at least the other east coast public schools. So you have Penn State and UVA, as well as UD, Va Tech, GA Tech, UNC, etc. Add to that the negligible degree to which attending "the best school" effects your outcomes (spoiler: virtually not at all. Being in the top 25% at your school far outweighs how good your school is) and you'll realize that they compete heavily. T…

Except not really because the cost for going to an out of state public school is much larger for a student so any given school has a large leg up on cost in competing for students in their state.

Except not really because most State schools on the East coast will give you in-state tuition after you live in said State for one year. Take a year off after highschool, make some money, then get in-state at whichever school you chose.

Source: many of my friends graduated college a year behind me after doing exactly what I'm suggesting.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#278

Post by cJ0th »

1_2__4 wrote: post #108

I hate sounding both old and weird but I cannot shake the feeling that much of the claims of economic health and growth in the US is... if not fake (I’m not totally nuts) but not accurate. My most charitable interpretation if I’m right is that we’re using the wrong metrics (possibly intentionally) that give a distorted view of the economy. But I keep hearing employment is great, productivity is great, stock market is…

Maybe decision makers are too data driven? Whatever they do has to be justifiable and most people don't argue against numbers. So trying to optimize aggregated or averaged numbers looks like a sensible approach. The problem, however, is that aggregated numbers don't tell much about the gap between rich and poor and averages don't describe individuals. As a result, there is a gap between reality and what people believe the data tells us.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#279

Post by ameister14 »

trts wrote: post #193
StanislavPetrov wrote: post #130

Earlier quoted context omitted.

>But I keep hearing employment is great, productivity is great, stock market is great The question you have to ask is, who are you hearing this from? The answer is: people with a vested interest in making you believe the economy is doing great, or people fooled into believing this by those with a vested interest. I suggest you closely examine the metrics used by those who claim the "economy is great". First these met…

"Hedonic adjustment" is meant to control for the 'quality' of some (limited) products sampled in the CPI such as rent, computers and automobiles. 'quality-adjusted' means that they run a standard linear regression across the features of sampled items to normalize the variation in the sample. For example, the sampled rent of apartments would be modeled as (in the simplest example I can think of) : y = rent, b = slope,…

Hanlon's Razor seems to be applicable here.

Re: More Americans Are Falling Behind on Student Loans, and Nobody Quite Knows Why

#280

Post by alistairSH »

brewdad wrote: post #274
alistairSH wrote: post #268

Earlier quoted context omitted.

tssva is correct, most states have matriculation agreements between the CC system and state college system. So, at worst, you finish your degree at your home states flagship state university (obviously, those vary, but generally, each state has at least one well respected institution). If you're in VA, you "hit the jackpot" and have many choices (UVA, W&M, VT, plus a half-dozen other solid choices). Locally (VA), stu…

Unfortunately, my state's universities are decidedly mediocre. Both flagships sit outside the top 100 nationally. Bordering states do have strong public universities, so I will have to see if there is any reciprocity. Otherwise, it looks like we'll have to do a lot of close examination of the total financial packages being offered when the time comes. I graduated in the mid-90s with $20k in debt. That wasn't fun but…

VA also has a private college subsidy (effectively brings most private college tuition down near state-tuition rates). Maybe your state offers something similar? And, check other in-state privates, maybe they offer something like Shepherd U.
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