Student Loan Debt To Exceed $1 Trillion This Year

Student loan debt will top $1 trillion this year for the first time in history, USA Today reports.

According to the Federal Reserve Bank of New York, students took out more than $100 billion in loans in 2010, and will have $1 trillion in outstanding loans this year -- twice the amount of five years ago.

Politico has more on the report:

The average full-time undergraduate student borrowed $4,963 in 2010, up 63 percent from a decade earlier, even after adjusting for inflation, the report says.

Meanwhile, with a greater loan burden, the percentage of borrowers that defaulted on their student debts also rose - from 6.7 percent in 2007 to 8.8 percent in 2009.

[See the states with the highest student loan default rates.]

A report last year from the Project on Student Debt put the average student debt load at $24,000.

Read below real stories from students struggling in debt from the HuffPost College series Majoring in Debt. Are you in debt? What's your student loan story? Email [e-mail] or post in the comments section.

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• Brittany Baker, Allegheny College/Sarah Lawrence College

  I'm all for paying high prices for good value -- and my education was certainly of quality -- but I'm not in the market to be abused. From interest rates to the ease of borrowing, to confusion of terms and steadily climbing price of college tuition, I guess I have to thank all of the higher education system while I have the floor to speak. To the loan companies, the banks and private colleges: thank you. I and my peers will forever be indebted to you. <a href="http://www.huffingtonpost.com/brittany-baker/debt-up-to-my-neck_b_945267.html" target="_hplink">Read more...</a>

• Mike Vattuone, UC-Berkeley

  I currently owe around $23,000 not including interest and Parent PLUS loans, which my mother is still generously paying off. She is 60 years old and works 11 to 12 hour days selling flooring, which her employers pay on commission and only if no mistakes are made. She can't retire because she has to help me pay back my loans, and she won't let me pay the PLUS loans myself. It's very frustrating. <a href="http://www.huffingtonpost.com/mike-vattuone/colleges-catch22_b_945213.html" target="_hplink">Read more...</a>

• Quinn Anderson, Boise State

  As an average, working-class, white American male who is neither left-handed nor a great athlete, the options for scholarships available to me have always been slim. Combine that with my parents' income -- which is above Pell Grant eligibility and too high to be considered for greater loan amounts -- and you get my situation. At the end of the spring 2012 semester I will be $50,000 plus in debt, which means I will have reached my loan cap for borrowing. With a credit rating that sunk to an embarrassing low years ago, there is no way for me to borrow using private loans to finance my education. <a href="http://www.huffingtonpost.com/quinn-anderson/quinn-anderson-27-boise-s_b_943879.html" target="_hplink">Read more...</a>

• Laquinda Settles, New York Institute of Technology

  I graduated from the New York Institute of Technology in May 2010 with a degree in Communication Arts; I am currently working 2 part-time jobs with no benefits and making $12 an hour. I'm also so over my head in debt with college loans. It's to the point that I'm considering filing for bankruptcy. I went to college to educate myself and make more money, but it feels like I dug my own grave. College is one of the biggest scams in the world; some of these institutions charge students between $700-$800 per credit for an undergrad degree. <a href="http://www.huffingtonpost.com/laquinda-settles/a-degree-in-hand-but-what_b_951098.html" target="_hplink">Read more...</a>

• Aleesha Nash, New York University

  I am a 31-year old woman originally from Ohio working and living in New York City area. I graduated with a Master's degree in Speech and Interpersonal Communications from New York University's Steinhardt School of Culture, Education, and Human Development in 2007. Logging into the Federal Student Aid website I see that today my balance is $104,104.63 for a percentage of the information in my head. <a href="http://www.huffingtonpost.com/aleesha-nash/debt-thats-worth-it_b_945223.html" target="_hplink">Read more...</a>

• Jaclyn Cabral, Elon University

  I am a recent graduate from Elon University, a private school in North Carolina, and have $90,808 of college debt. Though my debt seems extremely high, Elon is also regarded as one of the most affordable private college educations. My story dates back to high school where my parents worked opposing shifts simply to make ends meet. I knew since middle school that I would go to a great college and venture away from my hometown. My motivation during the past 17 years of my educational career was to do well, go to a great college and then have no problem landing my dream job. <a href="http://www.huffingtonpost.com/jaclyn-cabral/post_2357_b_945238.html" target="_hplink">Read more...</a>

• Mike Newman, Ohio State University

  I graduated from the Ohio State University with a fine arts degree in 2004. This is what I settled on after changing my major four times in my first three years at school. Clearly college wasn't for me, but I finished it because I wanted to make my parents proud and thought it would improve my life. Neither of my parents went to college, but they managed a pretty good life for themselves. Like all loving parents they wanted me to have a better life than them and were duped into believing that college was the answer. From the first day in elementary school to my last day in high school, we believed the myth that college was the only real path to success. <a href="http://www.huffingtonpost.com/mike-newman/forced-to-fall-off-the-gr_b_945263.html" target="_hplink">Read more...</a>

• Brandon Woods, Hampton University

  I turned down a full ride at Michigan State (a school that ranks in the top 20 in my field, education) to get the HBCU (Historically Black College and University) experience at Hampton University. It was the best thing I could have done as far as experiences go, but the worst for my finances. They say you can't put a price on experience, but I can. Roughly $24,000 my freshman year, and it only got more expensive every year after that. <a href="http://www.huffingtonpost.com/brandon-woods/i-should-have-listened-to_b_951080.html" target="_hplink">Read more...</a>

• Erin Dunphy, Ithaca College

  I grew up with an insatiable need to explore the world around me. So I knew when I was going to go to college I was going to do two things: One, major in journalism and two, leave my home. It was time for me to blaze my own path. I had worked hard throughout high school and did all those things they tell you to do to get as much money out of the process as possible. I was an honors graduate and was involved in almost every kind of extracurricular activity. I did my best to be the girl any college would want -- and therefore would hopefully give money that she wouldn't have to pay back. <a href="http://www.huffingtonpost.com/erin-dunphy/excited-for-the-future-ev_b_945253.html" target="_hplink">Read more....</a>

Comments

[healthybudgetcoach]

09:14 AM on 11/10/2011

You can go to college and not have enormous debt. Taking out loans is a personal decision and not one that is forced upon you. You make a decision to drive to another store to get a better price why not do the same when it comes to college? http://www.healthybudgetcoach.com/

[TiltUpward dot org]

04:46 PM on 11/01/2011

This is why it's time to create our own breaks instead of looking for someone else to give us breaks. We know that the Banking & Student Lending Industries lobby Congress to legislate their profitable racketing. The question is what are we going to do about it ourselves? We have the ability to create what we want for ourselves. Congress will not provide the solution we're looking for. We ourselves must become the solution we're looking for.

I absolutely agree that borrowers must be accountable for the choices they make. However, I do not agree with the Congressional removal of standard consumer protections and bankruptcy protection from Student Loans. Every other loan is nondischargeable by bankruptcy except for student loans. Therefore, another way to reform the system is by restoring these protections to Student Loans because without these protections, the Student Lending Industry has unregulated free reign to victimize borrowers with its usurious practices. The Industry has become a racket.

What also needs to be understood is that college is not the only path to success. Many are borrowing huge amounts for an outdated education that is irrelevant in today's ever-changing global economy. Why borrow over $20K for the same exact information you can freely access through libraries, conversations and the internet? Our job market has become a degree-saturated market where the value of the college degree is plummeting.

[StringHub]

08:32 AM on 11/01/2011

I think students, the government, and colleges and universities need to look at an entrepreneurial solution to the student debt problem. I recently wrote a blog post titled, "An Entrepreneurial Solution to Student Loan Debt" - http://blog.stringhub.com/2011/11/student-loan-debt-an-entrepreneurial-solution/

[RobM1981]

07:06 PM on 10/24/2011

Let me get this straight:

A young man gets a full-boat scholarship to one of the best schools for his major, but he decides that it's not "ethnic" (being polite) enough. His father counsels him "take the money," but he needs a "cultural experience," so he gets into debt up to his neck...

...and I'm supposed to pay for that?

A young woman gets into debt for over $70,000 - for a degree in "non-fiction writing" and doesn't realize that this is an unbelievably dumb thing to do...

...so I'm supposed to pay for that?

Monster is listing, right this second, literally thousands of engineering, nursing, science (not "research assistant...") and other such jobs. College grads who don't act foolishly *are* getting jobs. Unemployment amongst all college grads is only 5%.

I am the 53%, and this is the kind of thing that disgusts me.

If you made a really dumb decision, in spite of your parents trying to talk some sense into you, then it's time to suck it up and pay off your debts.

Good grief, this is absurd.

[John MC]

03:42 PM on 10/26/2011

It is absurd. They need better stories then these, I can’t feel much sympathy for these adults.

I have 2 kids in college and I know how expensive college can be, but I have also learned how not to waste money on college.

[rh654]

02:22 PM on 10/24/2011

Recommendations:

1) Attend a Community College and take very class you can that will transfer - and if you can live at home - do so.

2) Select your University with an eye towards cost as much as perceived quality - again if you can live at home and attend University that will save huge amounts of money.

3) Be realistic about how much your major will pay and what the job prospects are. Sure you may want to really major in journalism, art history, communications, etc.. but are there jobs that pay what you will need for however much debt you will take on?

[cd1081]

04:00 AM on 10/22/2011

we saddle our students with these horrible loans yet we want to be
the best in the world in education.
the sons and daughters of millionaires and billionaires have it so good while
the odds are stacked against the vast majority of our young people.
they need to go into all these burdensome debts to go to universities
and colleges. something is really terribly wrong here.

[Anti-Panoptic]

09:47 AM on 10/22/2011

Thankyou! Im 50,000 in debt for getting my masters so I can teach. smh

[hamsteronwheel]

10:21 AM on 10/21/2011

we're all hamsters on neocon "financially engineered" and "financially innovated" wheels

this is the economy our hard working & studious youth will enter

"the 2000s were the first decade we are aware of where net job growth was negative. The economy as a whole was a lot bigger at the end of the decade, and the population was a lot bigger, but people with jobs was not."

http://www.technologyreview.com/blog/editors/27268/?nlid=nldly&nld=2011-10-21

"The median income fell in 2010 for the second year in a row to $26,364, a 1.2 percent drop from 2009, and the lowest level since 1999, according to David Cay Johnston at Reuters."

http://www.huffingtonpost.com/2011/10/20/us-incomes-falling-as-optimism-reaches-10-year-low_n_1022118.html

Top 1 Percent Control 42 Percent of Financial Wealth in the U.S. – How Average Americans are Lured into Debt Servitude by Promises of Mega Wealth.

93% of ALL WEALTH OWNED BY TOP 10%

http://www.mybudget360.com/top-1-percent-control-42-percent-of-financial-wealth-in-the-us-how-average-americans-are-lured-into-debt-servitude-by-promises-of-mega-wealth/

Income Inequality: Top 400 U.S. Earners See Income Rise 476% In Last 15 Years

http://www.huffingtonpost.com/2010/03/05/income-inequality-top-400_n_487878.html

New York's Income Inequality Worse Than In Chile: Study

http://www.huffingtonpost.com/2010/12/17/new-yorks-income-inequali_n_798462.html

[hamsteronwheel]

09:29 AM on 10/21/2011

we're all hamsters on neocon "financially engineered" and "financially innovated" wheels

the British politician Tony Benn say, “If you want a compliant population, saddle the young with debt.”

My own daughter has birth-to-death total health coverage provided by the state. Despite American insurance industry propaganda, both she and I have found this health care to be first class (if a little slow in nonemergency cases). She has a total debt of $20,000 for her undergraduate and post-graduate education, and this is only for loans taken out for her living expenses while she was studying. Her tuition was free. I am paying this debt, but if she were doing so it would be taken out of her salary at a rate of around 5 percent. She would not be liable for any payments at times when she would be unemployed. She’s paid well as a grammar school teacher in London. She lives in a spacious, Edwardian-era apartment in the center of the city run by a state-subsidized cooperative which charges her a rent about one-third the market value. After three years of working, she has been able to take a year off to travel around the world. She has entered adulthood unencumbered.

My friend with the beleaguered daughter in Chicago, incidentally, pays income tax at a rate around 15 percent higher than I have been paying in Europe.

http://weeklyseven.com/news/2011/04/14/what-freedom

[McKeaton]

08:28 AM on 10/21/2011

Debt slavery...the earlier , thr better...thanks GS and Fed. Res.

[tald311]

01:47 AM on 10/21/2011

There is a crisis brewing with this $1 Trillion+ in debt. How many people are graduating with 40K to 200K or more debt who cannot find jobs? What happens when the defaults on student loans start to rise?

The traditional gripe that higher Ed is out of touch with the professional world is more exacerbated now with the high unemployment and lack of jobs. You really have to choose the right profession in school now if you want to find a job so you can spend the next 20 to 30 years paying of the insane loan you took out.

I hate to say but the traditional fare of perquisite classes, 4 year graduation cycle and the atmosphere that institutions and related commercial interests have in making money of college students (the Third Class) is no longer sustainable and really damaging the prospects of those attending schools.

Colleges and Universities need to change their practices and offer competitive tuitions and real value to what they are teaching. Like many things, the model being used for higher education for 60 years is busted.

The consequences for the higher Ed system not being able to adapt and being fat, lazy and comfortable are coming.

[ChezMJ]

12:19 AM on 10/21/2011

This country needs to have a big conversation about education. It has been so drilled into parents & students that they must go to college & grad school that they are willing to do anything to get into a prestige university. I know a woman with a $200,000.00 undergrad degree who is a stand up comic. Thank goodness her parents paid! She'd be in debt until she's a senior--not a senior after Jr. yr.--a senior on Social Security!

Degrees must be thought of as an asset & few kids graduate with a degree that prepares them to "do" anything, career wise. Accounting, engineering, nursing, teaching, yes but your basic English, history, psych...you'd better be sure you're not so far in debt you'll never get out.

I counseled a 39 year old not to go to law school. It's three years of not only paying for the degree but 3 years out of the work force. He'd be mid 40s before he got out. He wouldn't have time to make back the $ his degree cost and coupled with the opportunity loss, it's not sensible.

Education for education's sake is a wonderful thing. Never stop learning but be sensible about where & how you do it. Consumer Education should be a requirement to graduate from high school because many don't know the difference between a stock & a bond or the true cost of credit...including education loans.

[fortyfiveseventy]

10:40 PM on 10/20/2011

Student loan debt is unnecessary. I worked through college and also attended community college before transferring. It's possible, even today, to get a fine education for little money.

[axt113]

11:25 PM on 10/20/2011

Not so much anymore, even in state public universities cost around 20K plus a year, and that price is going to rise over the next few years, even if you work 20-30 hours a week at minimum wage, you aren't going to be able to cover that cost (working more than that is not recommended by most schools if you are taking a full course load)

[Elk Hunter 1]

09:47 PM on 10/20/2011

Maybe these kids who are part of the OWS crowd on the basis of crying about student loan debt should go and protest somewhere else. Maybe just maybe it's not the people on wall streets fault they are in so bad of debt.

I just wonder what would happen to those super high tuition costs if all of these people focused thier energy on the higher education system? Why do the costs of college keep going up while the level of education seems to stay the same or go down? Why do the students of all these big name schools have to buy a new football stadium with tuition fees? Where is the justification of charging a student who lives two states away 3 or 4 times the cost of someone who lives in state? Also why do we have a government that is willing to give pale grants to prisoners who will never see the light of day?

Even with all of that being said, these students dont' have to go into so much debt. I understand it is easier to borrow money and not worry about it until your done with school, but maybe if they had to pay as they went these kids would do better in school and get it done faster. We all know 1 or more people who are in thier 6th year of college and still don't even have a bachelors. That is just insane. I dont' feel bad for those people.

[axt113]

10:25 PM on 10/20/2011

Well if there were jobs and less wealth disparity, the students could pay off their debts, so protesting WS is the right place for them to be

[Elk Hunter 1]

10:29 PM on 10/20/2011

They don't need to go into debt to pay for school. Why is school so expensive that they need to be in debt nearly six figures to finish?

There are a lot of people to blame for the lack of jobs. WS is just one of many who are to blame.

[fortyfiveseventy]

10:41 PM on 10/20/2011

Wall Street is to blame for that too?

[denhamdk]

05:22 PM on 10/20/2011

The student loan "problem" goes back to the 1980's. I am a 53 year old woman with loan debt from before 1986. I am now on disability and not able to pay even small payments at this time. I never finished my degree so I have received very little benefit from my education. Undiagnosed mental health problems kept me from finishing school or ever working at a job long enough to make enough money to do little more than survive. After many years of struggling, and finally being in many years of treatment, I still cannot work to the best my intelligence has to offer. I still have a high principle on my loan and the amount of interest is a nightmare. Now, at the age of 53, and considering finishing my education,I am wondering if it would be worth the effort. Will I ever be able to make enough to pay off the loan and the interest?

[aliceandthecat]

04:09 PM on 10/20/2011

Isn't it interesting that so many of the big Wall St. players hold stakes in for profit universities. We should send loans and grant to for profits, but rather subsidize public schools, and their students. For profit degrees are garbage, or worse. This is the work of the vampire squid.....