Is student debt a crisis or not? That is a very good question! A good way to answer this question is to focus on Statistics. First, of the 20 million Americans that attend college, 60% of them borrow money to help pay for costs. There are about 37 million people with outstanding student debt. This means they are not making payments on their loans due to being enrolled in school still or cannot afford to pay. 14% of people with outstanding debt cannot afford to pay back their student loans. There is about $85 billion in pass due amounts of debt. Two out of 5 borrows become delinquent at some point in the first 5 years. These numbers are terrifying. Over half of college students are borrowing money. This is a large number and it continues to rise. As that number increases so does the amount of people with outstanding student debt. $85 billion dollars is money that could be used for other things, but instead it is just a balance that may never be paid back.
Now, why are students struggling to pay back their student loans? They are going to graduate and get a job in their chosen field and pay back loans immediately. Sounds perfect in theory, but it doesn’t happen that way. There are several different reasons why students are struggling to pay back their student debt. 48% of 25-34 year olds struggle due to being unemployed or under-employed. 52% of students believe their financial situation is fair. 70% of students claim that it is more difficult to make ends meet than the previous four years. 42% of students have other forms of personal debt that they must pay off as well. Based on these statistics, I think that most students are under-employed or unemployed. The job market is rather difficult right now. Often those that go into a career after college are forced to go into a different field due to a lack of jobs. Regardless, if you can pay or not the Federal government wants their money back. This is an epidemic in the making and it will soon burst. The government needs to learn like bank and businesses have learned. You cannot give out money on credit because it will continue to increase. When people are paying back at a slower rate than they are borrowing, then the system is going to crash. People should focus more on this crisis and not dismiss it. Students need help or student debt can create the next recession or worse…depression! Think about it!