Student Loan Debt And Consumer Choice - 2824 Words

Student Loan Debt and Consumer Choice In today’s society, student loans are haunting the lives of millions of postgraduates all over the United States. Students who have carelessly taken out loans and those in serious need of financial aid for their college education are now burdened with thousands of dollars worth of debt. As the student debt average continues to increase in our nation, the budgets of postgraduates begin to dwindle and the amount of defaults grow dramatically. With the large student debts our young adults are now dealt with, recent graduates are forced to compromise certain aspects of their quality and standard of living after graduation. Our nation’s recent graduate’s budgets are being directly affected by the student loan debt and interest accrued during and after their college careers. Student loans are a form of financial aid given by federal and private organizations designed to help fund the student’s tuition, housing, books, and ot her expenses. Student loans are primarily given to those who are in most need of financial assistance. The interest rates that accompany these loans are relatively lower than those of credit cards, housing and auto loans, because these loans were meant to be quickly and easily paid off. With federal interest rates fixed at as low as five percent and private loan interest rates decreasing, it comes to question: why is the amount of student loan debt in our nation increasing so rapidly? And with the amount of student loanShow MoreRelatedThe Debt Of Student Loan Debt1168 Words   |  5 Pages Here in the United States, there are many forms of consumer debt, which help contribute to the large sums of debt countless Americans find themselves faced with. Directly effecting many college students is student loan debt. Student loan debt is now the second largest form of consumer debt behind housing† declares the Federal Reserve Bank of New York (Grisales). This is due to the fact tha t student loan debt grew 7.1% in 2014 to $1.2 trillion (Grisales). If this statistic alone is not worrisomeRead MoreJohn Maynard Keynes Absolute Income Hypothesis1481 Words   |  6 Pagesthat aggregate consumption is highly dependent upon disposable income; but also, as total income increased, the proportions of savings would increase, meaning one’s marginal propensity to consume (MPC) would decrease. Leading to the assumption that consumers’ consumption decisions are made only by considering disposable income. Following Keynes Absolute Income Hypothesis, James Duesenberry developed the Relative Income Hypothesis (Duesenberry 1949). This theory asserts that consumption is not onlyRead MoreStudent Debt Of High School Students1527 Words   |  7 Pagespopularity, investment of consumer debt is student loans. Since 2008, student debt has been rising in increments of nearly $100 billion (Schrager). As alarming as it seems, this is not the result of student decisions alone. High school students are being pressured by society to further their education. Students seem to be raised believing a college degree is the ticket to success. However, it is not; anyone can become successful, regardless of background or education. Some students strive for attendingRead MorePersonal Finance1129 Words   |  5 PagesA KEY True or False 1. True 2. False—A debit card will work just fine when renting cars and checking into hotels. 3. False—The debt snowball begins with your smallest debt. 4. True 5. False—If you have to loan money to a friend, give it to them as a gift. Never co-sign a loan. Matching 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. i. b d j c k e l a f Multiple Choice 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. c d a a b d a d c c b d c d a Short Answer: 31. The adult market isRead MoreStudent Debt Crisis1380 Words   |  6 Pages A student loan is designed to help students pay for university tuition, books, and living expenses. It may differ from other types of loans in that the interest rate may be substantially lower and the repayment schedule may be deferred while the student is still in education. It also differs in many countries in the strict laws regulating renegotiating and bankruptcy. There are two types of student loan that can be applied which are federal student loan and private student loan. BasicallyRead MoreStudent Debt Crisis And Its Effects On The Economy1586 Words   |  7 Pagesstudent debt crisis has reached an all time high with debt reaching a total of 1.3 trillion dollars across the United States.With tuition cost increasing,lack of scholarships and unpaid back loans,student debt will continue to increase even higher.The enormous amount of debt put upon each student creates the inability of those students to help the economy grow.Our economy as we know it is a loop and decreasing the student debt significantly will help the economy grow.Instead of putting that moneyRead MoreStudent Loan Is A Terrible Idea1308 Words   |  6 PagesStudent loan forgiveness is a terrible idea. Sure, in an idealistic world it would be great if the country could forgive all student loan debt and thus bring relief to all students across the nation. Realistic? Not necess arily! Instead of the fairytale notion of student loan forgiveness being the answer to all the problems, America would fair better in taking the initiative in making reforms to the educational loan system that are a bit more realistic. Student loans are a massive predicament in theRead MoreCollege Debt Is Increasing Number Of Students1390 Words   |  6 Pagesnumber of students are turning to college student loans. As a result of these changes in prices and policies, the percentage of undergraduates borrowing has increased from 37.8% to 46.2% for public 4-year institutions and from 48.5% to 58.9% for private institutions. According to one estimate, student loan debt has reached $1 trillion dollars, surpassing credit card debt (Reynolds and Brandon). Most recently, another report estimated that two-thirds of college graduates in 2011 had an average loan debtRead MoreThe Terribly High Cost of Education928 Words   |  4 Pageson graduating high school students. Students are dropping out rapidly because they do not have the appropriate funding. Other financial resources such as grandparents are helping out students more than ever now. Financial aid is supposed to provide money to students who cannot afford tuition, but unfortunately they give very little to only those who quality. When students cannot come up with their tuition money, they are forced to take out student loans. Student loan debt causes numerous problemsRead MoreStudent Loans And The American Dream1708 Words   |  7 PagesIs a College Degree the Key: An Analysis on Student Loans and the American Dream These days, going to college is hailed to be the solution, the key to making something of oneself in life. It is celebrated as a part of life that will make a person successful and rich later on. A degree is essential to making one’s way up the 21st century economy. College is meant to give people a chance at the American Dream – an education, a job, money, and quite possibly a spouse. But is that promise too good to