Students entering the job market today are not only finding employment difficult, but also have to deal with the tremendous burden of paying back their school loans.
It was revealed that the amount of student loans taken out last year crossed the $100 billion mark for the first time and total loans outstanding will most likely reach $1 trillion this year.
As Reported By USA Today:
Students are borrowing twice what they did a decade ago after adjusting for inflation, the College Board reports. Total outstanding debt has doubled in the past five years — a sharp contrast to consumers reducing what's owed on home loans and credit cards.
Taxpayers and other lenders have little risk of losing money on the loans, unlike mortgages made during the real estate bubble. Congress has given the lenders, the government included, broad collection powers, far greater than those of mortgage or credit card lenders. The debt can't be shed in bankruptcy.
The credit risk falls on young people who will start adult life deeper in debt, a burden that could place a drag on the economy in the future.
These latest numbers released are inexcusable, it's a shame that so many students are in debt before they are even employed. For help on money management and tips click over to flexyourfreedom.
SOURCE: USA Today