Student Loan Debt Continues to Rise

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Student Loan Debt Continues to Rise

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Shannon Goldhahn, Centurion Staff

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The federal student loan debt is at an all-time high of $1.6 trillion dollars while private student loan debt has reached $119 billion dollars and now policy makers are scrambling for a solution.
According to a study by the Harvard Kennedy School, 57 percent of Americans view student debt as a problem for younger people.
Rebecca Lang a 20-year-old communications major from Morrisville found the idea of taking out a student loan extremely daunting.
“I will be graduating eventually but it’ll be over my dead body before I take out a loan because I don’t want to. It makes me feel trapped. As if were in a simulation and credit is the governments way of hounding us past retirement,” said Lang.
There are about 45 million Americans who are in an average of $35,000 in debt. If a borrower wanted to pay back the loan within 10 years with the current interest rate of 4.53 percent, then the monthly payments would be just under $400. If a parent is needed to borrow then the interest is around 6 to 7 percent, leading to higher monthly payments.
Many students felt that there isn’t enough information available when signing up for a student loan.
Maura Kelleher, 20-year-old psychology student from Doylestown thought that the interest rates on student loans are unreasonable.
“When you look at tuition costs, the idea of paying back student loans doesn’t seem so bad. But you don’t think about the accrued interest until six months after you graduate” she said.
Lang also worries about how long a loan takes to be repaid.
“My cousin took out student loans and she owes a lot and will be paying them off until she’s 40 and she only got her bachelors,” said Lang.
The growing student loan debt has led to many 2020 presidential candidates to share their idea to combat the high amount of debt.
Sen. Bernie Sanders(D) is leading the idea of student loan forgiveness for all federal loans. Sanders’ plan would cost around $2.2 trillion. He would execute it by placing a tax on Wall Street transactions which would make $2.4 trillion dollars in the next ten years.

Erin Baeder, a philosophy student at Bucks, found Sanders’ plan to be the best for the American people.
“Bernie’s plan covers everyone. His plan covers all the struggling students, the professionals, people who have two different jobs just to afford rent. His plan leaves no one out” she said.
Sen. Elizabeth Warren(D) is another presidential candidate with concrete plan to reduce student loan debt. Warren introduced the Student Loan Debt Relief Act that would allow 95 percent of Americans with student debt to see a portion of their balance reduced.
Her plan works on a scale. If the household income is below $100,000 then $50,000 of student debt will be cancelled. If a household earns between $100,000 and $250,000 then the balance would be reduced by $1 for every $3 a household earns over $100,000. If a household earns more than $250,000 then they would not receive any forgiveness.
Warren’s plan would be funded by a 2 percent tax on any wealth over $50 million and an additional 1 percent on wealth exceeding $1 billion. Some of the other Democrat candidates have other ideas.
Sen. Cory Booker(D) has plans to only forgive student loan debt for public school teachers.
There has only been one Republican leader who has taken the side of debt forgiveness, Wayne Johnson. Johnson worked under U.S. Secretary of Education Betsy DeVos. He believes that all borrowers should be forgiven of up to $50,000. This plan would be paid for by placing a 1 percent tax on the revenue from corporations and organizations.
All these plans could have the possibility of being enacted by next year. Although, the wait has students still feeling anxious over student loans.
20-year-old Sean Cahalin, an English major from Doylestown, is nervous over the payment of college.
“The way people spoke to me about college is literally why I have anxiety about life. I honestly don’t know what to trust because student loans are so messed up. They’re a scam and a trap to get hardworking, underprivileged young adults to sell their soul” Cahalin said.
Baeder wants to continue her education but as of right now she can’t afford it.
“If I wasn’t a scholarship student then I wouldn’t be taking classes. I have dreams of going to a university, but if I can’t afford it then I wouldn’t be able to go. I wouldn’t be able to take out loans” said Baeder.
Overall, student seemed to be worried about student loans and how they will affect their future. It appears that the crisis of debt from student loans will be a deciding factor when voting for the upcoming presidential election.

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