Student Loan Bubble Is Creating Millions Modern Day Serfs (Ivy League, degrees, costs)
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Since 2006, students from families with incomes less than $60,000 who are accepted to Harvard under our regular admissions policies have had no expected parent contribution for their education. Beginning in the fall of 2012, this "zero contribution threshold" will be increased to $65,000. Financial aid is available to all students based on assessed need.
Last edited by toobusytoday; 09-11-2012 at 10:33 PM..
Reason: link and SNIPPET please added link
To get a really good idea of just how much in real dollars term (after inflation over time)..........
$600.00 in 1952 had the same buying power as $5,109.55 in 2012. Annual inflation over this period was 3.63%.
So the real dollar cost HAS increased by a HUGE amount!!
And ironically that's right around the tuition rate of most state universities. So while it might have gone up at the Ivy Leagues--which I'd argue that with their generous financial aid brings the average tuition paid to around $5000 per year--it is still quite possible to get a secondary education for the same cost in real dollars after inflation as it was in 1952.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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The college I graduated from in 1975 cost me $1,500/year. Today it's just under $5,000, a little more than 3 times as much. Not too bad for 37 years of inflation. My first new car in 1972 was $2,500, my last in 2007 was $26,000. That's over 10 times as much. Maybe college is actually a bargain.
The best financial strategy is probably to attend a community college for years 1-2, then transfer to a state university. I would suggest only attending a private college if you are talented- in some area- to receive a full, 4 year scholarship.
The best financial strategy is probably to attend a community college for years 1-2, then transfer to a state university. I would suggest only attending a private college if you are talented- in some area- to receive a full, 4 year scholarship.
My husband and BIL both took this route. Two years at community college then both transferred to top tier universities to obtain engineering degrees. BIL went ROTC and husband finished with a whopping $3K in student loans--he sold the classic car he had rebuilt to fund his senior year.
This article was very good. I totally agree that college is a cash cow for a lot of people. I've worked at a college for almost 4 years. I saw first hand how tuition goes up and up...yet they cut back everywhere on administrative and operating costs. Fewer tenured professors and more adjuncts, more online classes (that can be pricey to develop, but once they get going, use less resources on campus than face-to-face classes), closing computer labs (with the excuse that most students have their own PCs anyway), etc. Paying tuition outright is impossible for even the upper-middle class to manage. With more and more students going to college, the availability of merit-based financial aid is increasingly difficult to obtain.
In spite of the fact that student loan debt can't be discharged in bankruptcy, I wouldn't equate my student loan debt to serfdom however. To me, it's one of those situations where I feel it is just so bad, there is no way it can get any worse, so it can only get better. Currently there is the income-contingent plan for repayment and also loan cancellation for when you work in public service for 10-years. It's not much...but it's something. And it's more than what was available 10 years ago.
Between all the defaults and all the whining about student loans, I anticipate the government will do one, if not two things: forgive the whole pile of student loans or bail out Sallie Mae and the other lenders. Possibly both. This whole mess is not going to have a happy ending.
People think college is absurdly expensive because from the 1950s to 1990s college was absurdly cheap. If you go back before the babyboomer period, you'll see that college was expensive. We're seeing a nice correction.
The issue is that students are taking loans left and right because they are so easy to get. Then they learn about their irresponsibility after the fact. Worse, adults in their lives are fully supportive of this behavior.
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