The data is in; the total amount that students borrow and actually receive grew about 25 percent for the 2008-2009 academic years. This is a staggering difference from the single digit increases we saw in the mid-nineties. The average college student has over 20,000 dollars in debt; with 2 out of 3 college students take out loans to pay for their college education.
What does that mean for you or your freshly graduated child? Sadly, nothing good; with the job market still teetering, jobs for inexperienced, freshly graduated future professionals are becoming a rare commodity. The well educated graduate is being looked over for those entry level positions in their chosen field for experienced just as educated older individuals. With current seasoned employees taking downgrades, pay cuts and doubling up on the workload, it leaves little room for the new positions. Additionally, with employers not filing open positions, the foot in the door jobs are all but extinct.
Now this is not true in every field, but it does put a dark cloud on the prospects of a new graduate. And regardless of economic conditions, the loan companies still expect their bills to be paid. As a jobless newly graduated individual, it is a dark day to receive the first student loan bill only to realize that you can’t pay it.
What now? While many students are taking what they can get in the workforce waiting for their time to shine; others are taking a different approach: If you can’t pay them, borrow more from them. That’s right; a lot of out of work college kids are getting advanced degrees to further defer their loan payments. Does that mean that more debt can help a person through one of the worst recessions of our time? Only time will tell.