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I'm currently a college student and I'm not surprised at this, at all. When I read "student loan horror stories", people say that they have no idea how they accumulated so much debt. Then I see episodes of Judge Judy and see that people are buying cars and clothes with their loan money. I was the only one in my circle of friends that knew about the controversy (last summer) surrounding the interest rate increase for subsidized loans (3.4% to 6.8%).
I know that I'll borrow $15,500 for my bachelor's degree and $30,000 for my master's. I plan on moving to Houston after graduation, and the job offers for new grads are paying an average of $40/hr or $83,200.
Quote:
According to the first annual High School Student Borrowing Survey, conducted by the Credit Union National Association (CUNA), nearly 50 percent of high school seniors in the U.S. can't even guess how much money they will need to pay for college.
What's more, "even greater numbers appear unable to understand the basic terms of a student loan," the survey concludes.
Many of the nearly 1,000 students surveyed have not set aside money for school, and not considered the seemingly irrelevant yet critical distinction between the terms and repayment options on public versus private student loans. They are, in essence, walking straight off of the same cliff as many of their peers before them.
Of the students, ages 17-18, surveyed by CUNA, 83 percent did not know the rates, and 77 percent did not know the duration, of their expected or existing college loans.
I was the only one in my circle of friends that knew about the controversy (last summer) surrounding the interest rate increase for subsidized loans (3.4% to 6.8%).
Good for you - I too do not understand how people don't know how much they are borrowing or what the terms of their loans are. Unfortunately, it's not just the kids. I know some parents who didn't know there were both unsubsidized loans and subsidized loans, and certainly didn't know the difference. Their kids are signing on the dotted line and their parents believe that "all" student loans have the same terms - 3.4% interest, not accumulating until graduation. It's scary how many people sign without reading and understanding.
This is a big problem for sure. Parents are not instilling basic education in their children.
Double-entry accounting is 700 years old. Why hasn't it been mandatory in our schools for the last 50 years? How hard can it be if it is 700 years old?
Double-entry accounting is 700 years old. Why hasn't it been mandatory in our schools for the last 50 years? How hard can it be if it is 700 years old?
Accounting is not mandatory in our district. But any parent who feels that it is important can have their students enroll in it. However, I don't believe that understanding student loans falls under accounting as much as it does under basic finance. Basic finance is a skillset that is passed down from parents to children. Similar to cooking and cleaning.
Accounting is not mandatory in our district. But any parent who feels that it is important can have their students enroll in it. However, I don't believe that understanding student loans falls under accounting as much as it does under basic finance. Basic finance is a skillset that is passed down from parents to children. Similar to cooking and cleaning.
If there ever should be a class taught in high school it should be a semester of bookkeeping followed by a semester of finance with basic tax and investments included.
Almost all high schools are requiring 2 years of foreign language. In my opinion, this can be reduced to one year as a requirement and add the aformentioned classes.
Our kids NEED practically applied coursework along with strong English, Math, and Science skills. Too many are graduating with no abilities to function in the immediate demands of adulthood.
College students do not understand that governments and schools can and do mislead them by allowing and encourageing the loans for degrees that are not in demand and in practical terms are worthless. True, a student can and should research extensively prior to signing. Thus perhaps it is just the students fault of being so naive.
College students do not understand that governments and schools can and do mislead them by allowing and encourageing the loans for degrees that are not in demand and in practical terms are worthless. True, a student can and should research extensively prior to signing. Thus perhaps it is just the students fault of being so naive.
Students and parents both. I can't imagine a parent not passing down common sense.
not exactly. what they do not understand is the concept of boundaries as they apply to the term "non dischargable loan". they think someone, mom, dad, the bank uncle sam,--- somebody will watch their back and not let them take the fall if it all goes sour. since they have been kept children their entire life, there is no reason for them not to feel that way. its like the first time they end up in jail, they are in a state of utter astonishment.
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