Student debt has risen to $1.5 trillion, more than all credit card debt. There is no way to discharge student debt, even through bankruptcy.
Women now hold two thirds of the student debt loans, nearing $1 trillion of the total. Women now make up 57 percent of those attending college. They tend to borrow more and then, when in the workforce, earn less than their male counterparts. With lower salaries, women struggle to repay.
State funding for public colleges has been reduced from two thirds per student to one third today. The cost of public education has been transferred to the students. Although college costs have skyrocketed, median family incomes have barely budged since 1976, so students must turn to loans for financing. Financial aid packages (mostly loans) are widely available but often poorly explained.
The consequences of the massive debt loads are becoming clearer: Young adults cannot afford to buy homes, cars, or invest in their futures, including graduate education to enter many professions. The birth rate is declining as indebted young adults cannot envisage raising families. Many careers post-college, in nonprofit jobs or teaching, do not offer high salaries or benefits.
Planning for college expenses and the aftermath of student debt weigh heavily. The impact on women is fraught, especially on single mothers who must manage the major cost of child care.
Repayment of student debt, with the government holding most of the debt at much higher rates than banks repay when they borrow, has become a problem. Myriads of problems have arisen with poorly managed loan servicers.
Currently no government action exists to address the issue of this massive and potentially destabilizing debt. This country depends on our future earners to keep Social Security and Medicare stable and citizens thriving.
What can be done? Here are some actions to take:
Protect and increase Pell Grants, which are now at their lowest purchasing power in decades. Moving them to a mandatory funding system would free them of disagreements within Congress. Allowing students more than one grant per school year, and increasing the income protection allowance helping working students qualify, is needed.
Support repayment methods reflecting borrowers’ challenges, thus eliminating confusion, needless bureaucracy, and stress.
Address additional costs students need. Child care availability for mothers and families needs to be addressed, such as on-campus child care. One federal program, CCAMPIS, needs to be reauthorized so parents are supported as they pursue their education.
Fight to eliminate the pay gap. That includes closing loopholes in existing laws and discarding salary history in setting pay in jobs.
Re-engineer data collection and transparency. Many important data points such as transferring students from two- to four-year degrees and how students are completing their education need to be better addressed. The Student Loan Bill of Rights creates a Student Loan Ombudsman that would help students, and also requires student loan servers to be licensed and follow basic student loan protections.
Institutions can do a lot more to provide financial aid information and guidance, to identify the best resources and avoid unnecessary debt, including managing debt after leaving college. They also need to do more to support nontraditional students — especially parents with dependent children, those working full-time and those with special educational challenges due to health, food insecurity, and related issues. Colleges can do better at providing students with information about job data in various fields after college.
FINALLY, we can ask candidates for office what they can do if elected to address these issues.
And then we can VOTE.
Karen Serrett is a member of AAUW Ashland. AAUW Update, a report prepared by members of the American Association of University Women, Ashland Branch, appears quarterly. For more information, go to ashland-or.aauw.net.