The cost of higher education is going, well, higher!
And throwing more money at it with longer and longer repayment plans for student loans will likely drive the cost of college up even faster. A great example is the new Pay As You Earn program. It encourages students to borrow even more to attend college. The government’s promise of low monthly payments and debt forgiveness will be very tempting to more and more students and their parents in the coming years.
One interesting outcome of larger student loans (that can be dragged out for a long, long time) is more and more young people will come out of college with a feeling of being “disadvantaged” as they slowly come to grips with the consequences of having a debt anchor wrapped around their neck. It’s sad to watch.
Hopefully, more and more borrowers will realize the wisdom of sacrificing when they get out of school and pour every dollar they can into paying off their student loans quickly.
That’s freedom! That will make that feeling of being “disadvantaged” go away real fast.