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It doesn't matter if $10k or $20k or whatever get forgiven. The second student loan payments restart, the economy is going to tank, I have no doubt that's why they keep pushing it back.
If you owe $50k with a payment of $500 a month, and they forgive $10k, guess what... you still owe $500 a month. They just knocked a few years off your repayment.
If they want to fight inflation they should just restart the student loan payments already, and watch how fast people stop spending money.
Paid about $35k for college (that includes room and board for 2 years and off campus for the final 2 years)
Public state university attended from 2002-2006
Also went to a PhD program from 2007-2012
ended up with about $25k in student loans through all of it (parents helped pay for part of undergrad). During my internships and my first 2 years of working I lived like a grad student to pay off that $25k as fast as possible.
I believe I paid around $40k for college. Student loans were $450ish a month. Got a bunch of grants because my family was pretty poor, and a small scholarship otherwise would have been around $60k.
Had like 6 loans total, paid off anything over 6% as fast as possible leaving the 4% ones and just added a little to the monthly payments but didn't rush to pay them off with urgency.
Had a job offer out of school $88k in north jersey.
It doesn't matter if $10k or $20k or whatever get forgiven. The second student loan payments restart, the economy is going to tank, I have no doubt that's why they keep pushing it back.
If you owe $50k with a payment of $500 a month, and they forgive $10k, guess what... you still owe $500 a month. They just knocked a few years off your repayment.
If they want to fight inflation they should just restart the student loan payments already, and watch how fast people stop spending money.
Exactly! Biden talks about fighting inflation blah blah blah blah but stops all student loan payments. Do you think these kids or their parents are saving that money? Doubt it. They are buying more crap and services further increasing even more demand. Excellent point.
trying to buy votes often doesn't work. Pelosi warned him about this student loan giveaway a year ago. This was a job for Congress to consider. We're talking hundreds of billions of dollars.
It doesn't matter if $10k or $20k or whatever get forgiven. The second student loan payments restart, the economy is going to tank, I have no doubt that's why they keep pushing it back.
If you owe $50k with a payment of $500 a month, and they forgive $10k, guess what... you still owe $500 a month. They just knocked a few years off your repayment.
If they want to fight inflation they should just restart the student loan payments already, and watch how fast people stop spending money.
Amazing how many people can't do the math you just summed up!
My Favorite: 10K in forgiveness will allow more people to buy homes........... A 3 minute call to a mortgage broker will tell them that owing 10k less won't make a difference on a mortgage application.
trying to buy votes often doesn't work. Pelosi warned him about this student loan giveaway a year ago. This was a job for Congress to consider. We're talking hundreds of billions of dollars.
It was a move to kickstart the youth vote. Yes, Pelosi warned him but it didn't matter. What mattered were the midterms.
The Supreme Court will decide if billions in federal student loan debt can be forgiven under President Joe Biden’s plan. My guess is they will vote no and the Biden Admin is working on their exit strategy.. https://www.bestcolleges.com/news/su...e-in-february/
I understand many younger voters believe Biden and the Dems owe them. However, the Dem leadership never intended to forgive the loans. They want the loans paid back just as much as the Rep.
But they needed to get out the youth vote and what better way than to promise a reduction in student debt.
Those in most distress are not the graduates. It's the people who didn't finish. They have 50% or 75% of the debt but none of earning power benefit of a degree.
I disagree. Those most in distress are the taxpayers who are picking up the tab for the above.
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Originally Posted by redguard57
For the graduates, it's also not that the median borrower can't possibly pay the median debt. They can but it's taking a longer time and a bigger chunk of their budgets than previous generations of students. For the same product. At the same time other costs are rising too, but their incomes/earning power is not rising at the same rate. Their financial lives are retarded as a result. This has a variety of follow on effects that impact us all such as lower birth rates.
We cannot change the past, but we can change the future.
We need to stop providing any form of government guaranteed student loans to anyone who cannot reasonably be expected to repay the taxpayers. Loan officers in the private sector are very good at sussing out those who cannot reasonably be expected to repay a non-student loan; our government should employ the same discipline.
No more loans to anyone with a pulse who can sign their name. We should have rigorous screening.
For example, someone with excellent high school grades & board scores & a strong mathematics aptitude (aced high school calculus & physics) who wants to become, say, a structural engineer or electrical engineer? Fine. That person has a reasonable chance of repaying their loan, and could qualify.
Or, at the other extreme, someone who coasts through high school with little interest in academics, is socially promoted even though they didn't complete most assignments, and wants to delay adulthood -- at taxpayer expense -- by enrolling at some educational institution that focuses on this type of student to get federal money? No. In the words of Admiral "Bull" Halsey, "Hell no. Strongly worded memo to follow."
Last edited by moguldreamer; 12-16-2022 at 10:38 AM..
A lot of people owe a lot more than their balances ever were. That's one part of the problem.
if you repay a student loan as originally agreed, beyond any agreement to capitalize interest while in school, then you will never owe a "lot more". Even with capitalization, after 4 years you wouldn't be a "lot more", you'd be about 15% more. But it's all built into the repayment anyway.
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Another problem is that college has skyrocketed in cost especially in the last 15 years, requiring bigger and bigger and bigger loans.
and few people disagree with the fact, it's how we get there that differs. "We" told the colleges "we will fund you" and so they raised the prices both because we devalued the cost (just borrow it and deal with it another day) but also to attract all those borrowers.
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Another problem is all this conditioning leads people to think "more education=better life." Experience since the 19th century tells us this is true, since education was the way to keep one step ahead of the de-skilling of industrialization and then the implosion of post-industrialization.
More education = an undergrad degree. Anyone can choose a field where the undergrad degree provides enough marginal income to repay the debt.
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Many of the jumbo balances come from graduate, professional, and law schools. The problem is less significantly undergraduate degrees, although they are also a problem.
If this were true, you wouldn't have the numbers of folks screaming how this $10K is going to make all the difference.
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A lot of employers started requiring these degrees through a process of expectations inflation decades in the making. Then even if they're not required they became de facto so because everyone else competing for the jobs had them, so you had to get one as well. The public responded by tripling down on trying to get these degrees to be competitive in the jobs marketplace.
Other than professional licenses, nothing beyond an undergrad is required. And engineer takes a PE test a year after graduation, typically.
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Unraveling this will not be easy and will require a level of reform every bit as wrenching and uncomfortable as Obamacare was, if not moreso.
But what I can tell you is that you won't win any political points blaming the borrowers. They were doing what YOU told them to do. What conservatives told them. Can't get ahead? "Upgrade your skills!" you said. They weren't spending the money on hookers and blow.
you are insinuating that it was conservatives that told kids to go become liberal degree-holders with more debt than they could afford to repay from the degree?
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Let those of you that advocate for your children NOT to get educated at the best schools possible cast the first stone. Raise your hand if you willfully told your kids to aim low and never try at school because it was all too expensive. Show me the ranks of the middle and affluent classes who willfully choose community college for their children over a ranked university when they can get into one. No. I bet a million all of you try to tell them to get into the best college possible because that gives them a fighting chance, and there's no way in hell any of you wouldn't try to give your kids the best freaking chance possible. There is a reason why people like Lori Laughlin were willing to commit bribery and fraud to get their daughter into USC instead of Arizona State.
Lucky for me, I have 1 kid in college right now, and one headed there next year. Before the first one ever filled out an application, I made it clear there were numerous quality state institutions, and should she desire to go private or out of state, then what she'd get was the equivalent amount of money.
When this issue reared its head about a decade ago, it became clear that indeed, young skulls of mush had been brainwashed into thinking ANY college degree was needed, and apparently a large portion of them heard "just borrow it all". Now, I doubt it was the parents who convinced them of this, though the parents should certainly have been giving them some financial lessons, and the schools as a backup.
I know fine young kids who didn't excel in HS who started in community college and then transferred to college. We really need to have about 80% of college-going 18 year olds start at CC - that's the # that don't really know what they want to study, or aren't such great learners they're not going to be able to adjust majors and still finish in 4 years. And guess what - when you apply for a job, or meet new friends as an independent adult, they ask "where did you graduate from?" not "tell me everything you did those 4 years". The diploma only says State U, not County CC AND State U.
You say that as if it were some form of nearly insurmountable barrier. It isn't. At most, it is an inconvenience. I know many people who moved to California for a year so they could establish residency for in-state tuition purposes, and then enrolled in a UC.
The bigger issue is being qualified as a financially independent student. Per StudentAid.gov:
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An independent student is one of the following: at least 24 years old, married, a graduate or professional student, a veteran, a member of the armed forces, an orphan, a ward of the court, someone with legal dependents other than a spouse, an emancipated minor or someone who is homeless or at risk of becoming homeless.
In NYS, unless you check one of those boxes, it doesn't matter where the student has established residency if the parent(s) is not domiciled in NY, and the student cannot provide documentation that they established residency in NY for reasons other than schooling, the student does not qualify for in-state tuition.
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A 3 minute call to a mortgage broker will tell them that owing 10k less won't make a difference on a mortgage application.