Student loan stereotypes are often held as truths near and dear to the hearts of non borrowers. Today’s post is here to crush those stereotypes into oblivion with widely available data packaged up in a usable form. Why? Because if folks run around believing stereotypes instead of reality it makes solving student loan debt much harder.
Cheers to the facts so you can slay the student loan stereotypes. Estimated read time < 5 minutes.
5. You have debt because you didn’t work during college.
- In 2015 43% of full-time college students and 78% of part-time college students worked.
- In 1980 the inflation-adjusted minimum wage was $9.83/hour. Currently the minimum wage in Wisconsin is $7.25/hour.
The buying power of minimum wage has significantly decreased since 1980.
4. You borrowed mostly for booze and spring break.
- According to a 2016 Student Loan Hero survey 79.8% of students said they did not use student loans to pay for things other than educational expenses, such as vacations, dining at restaurants, or entertainment.
- The 20% of students who used their student loans for other expenses were more likely to use the money to pay for cell phone bills and car payments than for vacations and alcohol.
Eighty percent of students said they did not use student loans to pay for things other than educational expenses.
3. You should’ve gotten scholarships to pay for college.
- Annually the private sector offers around $3 billion dollars in private scholarships.
- There is around $14.6 billion available in Pell Grants and another $20 billion in institutional grants.
- This fall approximately 20.4 million students attended college. That’s an average available amount of around $2,000 per student per year if all college students split up the available funding.
If the available grant and scholarship dollars were divided among all college students, each student would get around $2,000 per year.
2. You borrowed so much because you went to a private college.
- In 1980 the inflation adjusted cost of tuition and fees + room and board at four year public institutions was $7,015.
- In 2015 the cost of tuition and fees + room and board at four year public institutions was $19,189.
The inflation-adjusted cost of tuition and fees plus room and board at four year public institutions has increased 274% since 1980.
1. You have student loan debt because you were irresponsible.
- The annual cost for tuition and fees plus room and board at a four year public institution is over $19,000.
- The minimum wage is $7.25/hour in Wisconsin.
- The amount of scholarship and grant money available if split evenly among borrowers is about $2,000.
- In 2017 if you work at minimum wage for 20 hours per week (+$6,963 after taxes), obtain scholarships and grant money annually (+$2,000) and attend a public 4 year institution (-$19,189) you won’t have enough money to pay for college let alone books, and other necessary expenses.
- Objectively speaking for the average student working part time and obtaining scholarships and grants is not enough to cover the actual costs of attending college. The shortfall is over $10,000 every single year. After four years that’s a $40,000 deficit yet the average student has only $30,000 in student loan debt. Students and their families are being creative and working hard to minimize the amount of debt they borrow for college.
Despite working and obtaining scholarships the estimated shortfall for four years at a public institution is $40,000.
Times have changed, this is the true picture of paying for college.
In 1980 you could work a minimum wage job for $3.10/hour and pay $3,499 each year to attend college. That means the college student had to work 22 hours per week at minimum wage to pay for their costs.
Today you could work a minimum wage job for $7.25/hour and pay $19,189 each year to attend college. That means the college student had to work 51 hours per week at minimum wage to pay for their costs.
Costs have gone up and the buying power of minimum wage has gone down. The burden of student loan debt is not a result of work ethic, partying, failing to apply for scholarships and grants, attending private college, or being irresponsible. The burden of student loan debt is a result of increasing costs.
You’re a smart repayer who knows their facts and doesn’t take crap from anyone. If you learned something new please give this post a share and help slay the stereotypes!
Resources
- College student employment National Center for Education Statistics
- Minimum wage information US Department of Labor
- Consumer price index inflation calculator Bureau of Labor Statistics
- Student loan use for non educational expenses Student Loan Hero Survey
- Scholarship and grant information Finaid.org Report
- Tuition and fees over time National Center for Education Statistics
Recent Comments