It costs money to go to school and making it difficult for students to afford a quality education without assistance. Many students take out loans to pay their way in the hopes that when they graduate they will find a job that will help to pay down the debt they incurred.
Indeed, the press release reports that out of over 20 million Americans that attend college every year, 60% of them take out loans to pay for their education. In fact, there are approximately 37 million people in the US that have outstanding loan debt, accounting for a total debt value of $ 1 trillion dollars when you combine the $ 850 billion in federal loans and the $ 150 billion in private loans.
According to the infographic created by Frozen Pea Fund the debt to age ratios are astounding:
- Age 60 and Over: $ 2.2 million
- Age 50-59: 4.6 million
- 40-49: 5.7 million
- 30-39: 10.6 million
- 30 or under: 14 million
When looked at in terms of how loans are being repaid, the numbers reveal a dismal picture:
- 9.84 million people repay with their income
- 1.58 million people have income contingency payments
- 1.3 million people use pay-as-you-earn plans
- 3.35 million people use alternative plans not associated with income to repay
- 1.63 million people enroll in extended payment plans
- 45 million people have extended graduate repayment plans
Unfortunately, $ 52 billion dollars in loan debt was delinquent by the first half of 2013 – 21.8% defaulted within the first 2 years. This is due to the current state of affairs in the job market. More often than ever before finding a field-related job after graduation is not guaranteed.
Recent graduates find that they are struggling to get a job after graduation, and are being forced to take the same type of employment they could have gotten without the degree or incurring the debt. If a recent graduate is able to secure employment in their field, they are still contending with a 3% drop in their weekly paycheck – 4% if they are under the age of 25, on average. The amount of money they make does not help them to reduce their debt – it is just enough to satisfy essentials in many cases.