The student loan crisis has alway persisted in our media for far too long now with no long-term solution on the horizon; most are palliatives, or worst, band-aid solutions.
To make matters worse, these debts are in an upward trajectory where they are expected to rise in the coming years. It is estimated that by the year 2021, the total student loans will be over $2 trillion. This figure is expected to hit over $3 trillion before 2030. These show that the estimates are predicting an increase in student loans at much higher rates than we have ever experienced.
Every day there are stories of people struggling to maintain a healthy lifestyle, takeout mortgage or even startup a family because they cannot afford. The main reason most cited by these individuals is the student debt they have to pay.
For instance, graduates are subjected to huge monthly interest rates which may span over a decade or even decades. The higher interest rates make it very difficult for these students and graduates to meet their obligation of paying up student loans.
How serious is the student loan crisis?
It is estimated that the debt currently stands at over $1.6 trillion. This is more than the accumulated credit car loans in the entire nation, and even car loans. It is a problem for students, graduates, lenders, businesses which employs these individuals and government institutions responsible for higher education.
For instance, graduates are subjected to huge monthly interest rates which may span over a decade or even decades. The higher interest rates make it very difficult for these students and graduates to meet their obligation of paying up. This leads to defaulting of the loans at significantly higher rates than most types of loans. This affects the lenders who have to contend with the fact that they are losing money because the people are not being able to service their loans. This business makes huge loses due to these loans and sometimes they may require government help to unsettle some of these defaulted loans.
The fact that this loan crisis goes far beyond the financial struggles according to experts is very worrisome. For instance, young adults are finding themselves depressed due to the financial situations they are finding themselves into
Difficulty of solutions to the student loan crisis
Implementing solutions for student loans has been a very difficult task so far. We have always put our faith in Congress to make laws that would help curb these effect. This has taken years of waiting and optimism is fading away with each passing day.
Higher education institutions have also not been able to come up with solutions. This is because of the self-interest involved in these organizations. For instance, it is not in these institutions best interest to cut fees for students. This is because, over the last few decades, they have been increasing the salaries for the coaches, school administrators and coming up with projects that are cash-intensive and therefore they cannot be able to implement anything of the sort.
The solution that is not commonly discussed is the one involving the students. The students have a responsibility to determine their own future. They have the power to force the school administrations to reconsider the high rates they charge for higher education. The solution to their predicaments can sometimes lie in their hands.
If students can delay their enrollment by one or two years due to this rising cost of education. They can spend the time working, traveling or any productive activity they have always wanted to undertake. With no money coming in for the school administrators, they would most likely reconsider about the rising cost of higher education.
Perhaps this may not work at all, but so are the other solutions that have been suggested by the people we have entrusted to ensure that they come with these regulations. What we know for a fact is that a solution must be found to address this problem
