Student Debt

The following is a Guest Blog by Celina Jones.


Financial experts advise against accumulating debt unless there is a situation where it is necessary. In the current economic climate, it is more difficult than ever to get credit on decent interest rates and repayment is also hard to make on time. This is why you should avoid borrowing any amount, no matter how small, if you have any other option for getting the money. One type of debt which is unavoidable to a great extent is student debt. If you want higher education, you have to pay for it.


However, the cost of higher education has gone up over the years. Adding the expenses for books, tuition, stationery and all other things required increases the cost that you have to bear. You might also have to pay for accommodation while you are in college or university, making it more expensive for you. Since students don’t have the kind of jobs required to bear the cost, borrowing money is the only way they can get through college. Hence, student debt has been on the rise over the years.


The Convenient Choice for Students

It seems like a convenient option for students to borrow money and then pay it over a number of years. They can borrow the money they need now and then the repayment would be spread over 5 to 10, even more years. That way, the amount is broken down into smaller chunks making it easier to repay. However, the uncertain financial climate has made it hard for students to keep up with the repayment schedule and bear the costs associated with it.


In some cases, they require debt settlement services to find a way to deal with the debt if they are having a hard time paying back the money. When the students finally settle down and get married, they have to continue paying off their debt. At present, over 20% of all households are dealing with student debt. The sheer volume of total student debt has grown exponentially, nearing $1 trillion this year.


Relationship between Education and Economic Insecurity

The problem which most borrowers are facing is that they aren’t aware of the terms and conditions which apply to their loans. Hence, they face trouble paying the amount back. The growing link between student debt and higher education means that debt is becoming a major part of the economic insecurity faced by students after graduation. They have to pay off the amount they have borrowed for the next few years which means it is going to affect a significant part of their lives.


The main issue here is that even students with degrees from known institutes are finding it extremely difficult to find a high paying job. There was a time when having a degree virtually guaranteed you a good job with a six figure salary. With the recession taking its toll on the economy, the number of jobs available to them upon graduation has been receding for the past couple of years. This is the reason why the unemployment rate for people aged 20 to 24 is around 25%.


Even those students who get good jobs after graduating have to pay hundreds or thousands of dollars every month as part of the repayment plan. On average, a student has to pay the lender $800 to $1,500 unless the amount borrowed is exceptionally high. Even if the student makes a decent amount of money, the repayment takes away a considerable chunk of it. This leaves a small amount for them to get by and have a family.


The students have a hard time making any major economic decisions. They have to think twice before opting to buy a home or investing some money in any asset as most of their money is going towards the student debt they have accumulated. Moreover, having a family is another decision which they have to put off so that they don’t have to get by on a meager income, especially if they have to raise children.



There is no doubt that student debt is contributing to the growing divide in the relationship between student debt and economic insecurity. If the economy doesn’t improve in the next year or so, it could be some time before students are able to graduate with economic security  For information on debt consolidation companies, you are advised to visit



Author: ramanan50

Retired Senior Management Professional. Lectures on Indian Philosophy,Hinduism, Comparative Religions. Researching Philosophy, Religion. Free lance Writer.Blogger

One thought on “Student Debt”

  1. Making Indian currency weaker by the day is the main culprit which is increasing difficultuies to parents & students in repaying the debt of Foreign educaqtion. Since our politicos have most of their kids Buddus, they can either manage with influence or by not educating them at all. Because they have the means & clout.


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