It is official; the student loan debt has reached $1 trillion and is expected to reach $1.4 trillion by the year 2020. Earlier this month, this debt surpassed the amount of debt from credit cards. It seems as though student loan debt is climbing at a rapid pace, with little solutions from the state or feds to create a solution. Predictions show that the student loan bubble could the next bubble to burst, just like the housing crisis back in 2007. Since 2006, the average student debt has risen almost 30%.
The debt is not the only big issue here. The other issue is that many students who graduate college in a large amount of debt are having a harder time finding a job or a career, than say a decade or two ago—making it even harder to begin making the appropriate payments on their loans. If graduates cannot find a job upon graduation, that not only affects their ability to pay, but also the economy. How are these graduates supposed to buy homes, cars, etc. if they cannot make their monthly student loan payment? These factors for student loan debt are hot issue not only among college students, recent graduates, and their families, but for our elected officials across our state and in Washington, D.C
So what does this mean for Ohio? Ohio has been brainstorming and preparing for this bubble in hopes to take some of the financial stress off people going to college, anticipating a large amount of debt upon graduation. Ohio boasts itself as being one of the largest comprehensive public systems of higher education in the United States. Not only does Ohio offer 14 public universities with almost 25 branch campuses, it offers 23 community colleges, and over 120 adult training centers—those numbers do not include private institutions. Another factor for Ohio to brag about is that every Ohioan has at least one college or university within 30 miles of them!
Ohio’s solutions to the student loan debt issue are both common-sense initiatives and can be very cost-effective. Ohio has implemented a 3-year plan; this plan allows students to complete a typical 4-year bachelor’s degree in 3 years, cutting down on costs. The State has also implemented an easy credit transfer system that can allow students to get credits are less expensive branch/regional campuses or community colleges, and transfer their earned credits to the larger institution. These are just two examples of the many ways college bound people can relieve themselves from the financial crisis that is now the ever-growing student loan debt bubble.
http://www.forbes.com/sites/sherylnancenash/2012/03/22/student-loan-debt-1-trillion-and-counting/
http://www.ohiohighered.org/