Students and Their Finances
What does the future hold for the next generation in modern America? Are the youth of today going to be able to start off on a strong footing with a solid education under their belts and money in the bank? It certainly does not seem that way. Students are drowning in debt.
Student loans account for $1.2 trillion of borrowed money, a truly staggering amount of money. This enormous amount of debt could mean that people affected by the loans and repayments may have to wait to purchase a house or a car longer than those without debt, and it is these larger financial commitments that help drive American economic growth. Equally, it affects their ability to save for retirement, and so their financial well-being is at risk for years to come.
Some students who have taken loans are also struggling to keep their heads above water. 11.2% of those with loans are 90 plus days delinquent or in default. At this rate, they won’t be able to move out of mom and dad’s basement let alone buy their own home.
Getting a second job will be on the cards for a lot of college kids, but will they be able to pay off their loans once they enter their chosen field of study? A good way to get on top of student loans is pay off more each month than your monthly payment. This way, if you can afford it, you pay off your loan sooner with less interest, and so you save time and money. Doing this will decrease the overall cost of the loan over time. Once the loan is paid off, every cent you were paying towards student loans is now free for you to use towards whatever else you earmark it for. Planning for retirement is probably a good way to go, especially if you can set aside some money every month at that point.
Students are in trouble as they are in debt, but, if they can figure out ways to decrease their debts or eliminate them over a shorter period, the American economy will benefit, and everyone wins.
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