According to recent research, Americans now owe more in student loans than they do in credit card debt. A report by MSN Money says the reason for this shift is two-fold. For one, Americans are paying down their credit cards more these days and secondly, they’re racking up more student loan debt. The article sites research by Mark Kantrowitz who estimates that American student loan debt totals about $829.785 billion, while credit card debt is sitting at $826.5 billion.
American college students are paying far more for their college education than in years past. The average cost of a bachelor degree in 2008 was $23,186. It’s also important to note that student loans come with almost none of the protections that credit card debt includes such as bankruptcy protections, statutes of limitations, and truth in lending laws.
And much like the mortgage crisis, thousands of college students were given college loans without any investigation into their earning potential once they earned their degrees. So after college they’re faced with a difficult job market, low paying jobs, and huge monthly loan payments. The lesson to be learned is to truly investigate whether or not that private school or out-of-state college is really worth the hefty tuition. Because for most students it’s a price they’ll be paying for a very long time.
Tags: debt, college loans, Finance, personal finance, debt consolidation, credit card debt, Education
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