The Burden of Student Loans: A Post-Graduation Challenge

INTRODUCTION

Today, the majority of college students in our country are dealing with one issue: loans. Student loans are considered a burden from the application process to the monthly payments. When students graduate college, they are excited to have finally achieved one of the biggest accomplishment of their life. However, nowadays the end of those four years also marks the beginning of another challenge. Students find themselves facing debts larger than they could ever think of. With just six months given as a grace period, students become in a hurry to find jobs, stabilize their life and wait for the bills. Those unable to find employment fall into deeper debts and and even risk defaulting. Additionally, if not tracked properly, those first payments can catch students

Between 2000 and 2015, tuition at U.S. public colleges increased by 80 percent every year (McCarthy). At Northern New Mexico College, tuition increase by 359 percent between 2000 and 2015. This situation is also being experienced in other colleges of the country and creating panic among students (see Figure 1). While being useful and helping many get a college education, the burden the debt of student loans brings seem to discourage many and push them away. However, despite everything, spending on a college education remain an investment that some hope will result in better and higher paying jobs.

FIGURE 1 . Increase in Tuition From 2000 to 2015

TYPES OF STUDENT LOANS

While Pell Grants are being cut and leaving about 8 million students from low and modest income unable to afford college, students loans are becoming a necessity in a time when the cost of higher education is rising quickly. In 1980, Pell Grants covered 77 percent of the cost of a four-year college education. However, those grants have been decreasing and now cover less than one-third of students’ education (Flannery). Reductions similar to those are all