The current economy is facing an increasingly dangerous debt bubble much like the one experienced in 2008. Since there hasn’t been much economic progress since the recession, more and more college students and graduates are finding it hard to get good paying jobs that will help pay off loans.
The housing bubble in 2008 occurred because people kept taking on loans they couldn’t pay off, which eventually led financial institutions to fail due to purchase of toxic investments. Comparatively, students and recent grads have taken on loans they haven’t been able to pay back regularly, if at all. The amount of student debt trumps, by far, car, credit card, and home loans while estimated at $1.2 trillion.
According to the Wall Street Journal, there are around 22 million people with student loan debt. While the probability for higher education costs to fall in the near future is just a dream at this point, there is little certainty regarding what will happen to the market.
Luckily, since the 2008 recession, there have been numerous government regulations put in place to deter the act of betting on market failure, so the likelihood of another recession is still up for speculation. The difficulty of paying for an enormous amount of debt for going to college is unlikely to change, especially since the unemployment rate for recent college grads is 44%, according to CNN.
As college students, many of you should be wondering how the future will pan out after graduating—that’s why we’re here, right? Fortunately, a college education definitely helps in finding higher level jobs and larger salaries; however, after you move out of college you’ll need to take out car loans, credit card loans, and possibly loans to cover rent. Sounds optimistic.
Luckily, Lake Forest College has already prepared us for the rough world ahead by charging us absurd prices for items in the P.O.D., or by forcing us to pay high living expenses (compared to monthly rent at houses around campus) to name a few things. The issue of crippling student debt is not getting the attention it deserves; it is discouraging people from attending college, causing people to default on loans, and is ultimately a life long issue for some people. With that being said, good luck.
