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The student loan crisis is fast becoming a national epidemic

The student loan problem in America is what some economists are calling the next big economic bubble that just might burst.  Two other bubbles that keep the economy afloat are the housing market and consumer spending.   But we’re slowly entering into an era where these bubbles can’t exist forever, and there is likely going to be a day of reckoning on which the entire economy could fold.

Americans can no longer afford to do a lot of things that they used to be able to do:  They can’t afford to get sick without insurance, they can’t buy homes in many major cities, they can’t afford attorneys if they get into serious legal trouble, and they can’t afford to send their kids to college without massive loans and financial aid.  This scary crisis has long been ignored by government officials, but now students are coming out of college with more debt than they can ever afford to pay.

As a result, this is the first generation of children that are expected to actually DIE IN DEBT.  That means that they won’t start in the red and finish in the black….they are going to start in the red and end there.  This is hardly the future that we expected.

Our suggestion is that when you send your child to college, send them to the right school for the right reason.  That means the $35,000 per year private school might not be the best place to go and study Philosophy, since the degree won’t give enough earning power to deal with the debts.  Consider alternative learning options for the things you enjoy, like free classes online and look into spending money to learn skills that actually make you employable or give you the ability to run your own business.

You may also consider allowing your children to take responsibility for at least part of their loans, so that the entire burden is shared and not thrust onto one person.  When you’re planning for retirement, they’ll be hitting their peak earning years.  You don’t need that kind of financial headache.

PBS talked a little bit about this topic in the documentary below:

We’ve been keeping up with the ongoing shocks to the American economy, the real estate bubble going pop, credit card debt, the bank mess far and wide. Now there is a new headache coming to a family near you, rising defaults on student loans. Many of today’s grads owe more than a hundred thousand dollars. We’re talking tens of millions of people in trouble. Alexander Dean produced our report.

The phone rings often in Gina Moss’s little house in Baltimore.

It rings while she gets her daughter, Alice, ready for school. It rings when she’s putting her to bed and a lot in between.

Gina:              For two years, I’ve been screening my calls. Any number that I don’t recognize, I don’t answer.

Host:     Because why? Because they might be one of these people?

Gina:              Because they might be about collector, right. It might be one of the loan companies.

Host:     The calls she’s avoiding are from companies trying to collect on Moss’s overdue student loan payments.

Gina:              They treat you like you’re trying to be sneaky and be deceitful and like I’m hiding some Swiss bank account that I’m not giving them access to. That’s not the case at all. If I had the money, I would pay them. There just isn’t any money.

Host:     Moss currently owes about a thousand dollars a month in payments. That’s more than a third of her gross salary as a social worker so payments are always hard. A few weeks ago, in the middle of this deepening recession, Moss lost her job. Now she finds the payments are impossible to make.

Gina:              It was very devastating initially. The first week was really, really hard.

Speaker 1:     Gina Moss isn’t alone. She’s now at the heart of a colossal controversy. In America today, there are 70 million people, about a quarter of the US population.

You can watch the video on the topic below:

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5 thoughts on “The student loan crisis is fast becoming a national epidemic

  1. JOAN MORRIS

    tell Joan morris about it, because of 1 BLACK AMERICAN BORN WOMAN @ BLACK COLLEGE (FLORIDA MEMORIAL COLLEGE ), JOAN MORRIS COLLEGE TUTION WENT DOWN THE DRAIN, I AM NOT AN AMERICAN BORN, BUT THEY SAY I AM LYING, THE STAFF AND FACULTY @ FAMU LIE ABOUT BRUM LINE MAJOR CHAMPLAIN DEATH FOR 2 YEARS.

    *** Y DOES BLACK POLITICAN LET ANGER AND HATRED GETS IN THE WAY IN GIVING THE BLACK NEGRO STUDENT THEIR COLLEGE DEGREE RATHER THAN TO MAKE THIS MONEY WAIST.
    [email protected]
    754-244-6355

    Reply
  2. Mayon'naise Jackson

    @Joan Morris: I see why you did not get your degree. You can’t string two sentences together. That’s what’s wrong with a lot of these colleges today. They take your money, promise pipe dreams, and graduate people who can’t even write at a fundamental level. College is not for everyone and some people should be told that. Go pick up a trade and do something you can excel at instead of trying to waste your money on college. Nothing is wrong with that.

    Reply
  3. Rev Bullbone

    I attended an HBCU in the early 1960’s on what was called (told to me) a football scholarship. I was quarterback as well as offensive and team captain. The so-called scholarship became nothing more than four years of student loans the school officials tricked me into signing under the National Defense Student Loan Program. Plus, I had to work on campus under work-study and my student-athlete meal ticket was terminated immediately at the end of football season. I had to take a second job in janitorial work off campus to pay for my meals. Ten years after graduation, I got a call from a lawyer who told me: “Just pay what you can, when you can”. I wrote him a check and he used the information on the check to clean out my entire checking AND savings accounts 2 weeks before Christmas. You can only imagine what that did to my family finances, my childrens’ educational fund, and my ability to give my family (wife, two small children) any form of a holiday. with fun and gifts that year.. Colleges, their “degrees”, their tricks and traps, and their loans can be a triple scam — at least it was for me. Buyer beware .

    Reply
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