Importance of Financial Literacy With Regard to Students and Student Loan Debt

The average student leaves college with $26,000 in debt

The average student leaves college with $26,000 in debt

If you’ve picked up a newspaper in the last five years you’ve no doubt seen concerning headlines detailing the plight of college students and recent grads that are drowning in the massive amount of student loan debt they’ve accumulated.

With the national student loan debt having reached $1.1 trillion, and the average student walking away with a diploma and $26,000 in debt, these shocking numbers are hard to ignore.

Who’s to blame?
Critics blame the ever-increasing costs of college tuition and related expenses for the country’s massive student loan debt, and while there is indeed validity in this argument, the exorbitant price tag on higher education is only a piece of the puzzle. If you dig a little further, you’ll find the problem has much deeper roots: Students in the U.S. are severely deficient in even the most basic financial literacy. This deficiency hinders them from understanding what they’re getting into when they take out loans, and what their options are when they have to pay them back, further compounding their financial burden even after they leave school.

The many incoming and returning college students who are unprepared to successfully manage their finances reflect a continuing trend of financial illiteracy in our nation’s youth that has been consistent over the past decade. A recent report by USA today evidenced this literacy problem with shocking statistics:

“The Treasury Department and Department of Education have teamed the past three years to assess financial literacy in U.S. high schools, and the results haven’t been pretty: the average score of almost 76,900 students in 2010 was 70%,” USA Today reports. “Last year’s testing of about 84,000 students and this years of about 80,000 students were both a point lower: 69%… A biennial survey by Jumpstart Coalition for Personal Financial Literacy, conducted from 1997 to 2008, showed high school seniors doing even worse. In 1997, the average score on a 31-question financial literacy exam given as part of the survey was 57.3%. In 2008, the average score was at its lowest ever, 48.3%.”

How does financial literacy directly contribute to the student loan debt problem? When a financially burdened student does not fully understand or is not fully aware of the different repayment options available they will sometimes just terminate payments. After nine months of this, the student defaults on their loans. Defaulted loans can negatively impact credit scores, a financial no-no that can do significant damage far into the future; it can lead to wage garnishments; and if left unresolved for long enough, it can minify Social Security checks.

And these defaults are happening a lot.
Between financial hardship and misunderstanding of the repayment process, more than 7 million borrowers are in default on a federal or private student loan, as reported by the Consumer Financial Protection Bureau. In 2012, the Federal Reserve Bank of New York reported that the proportion of delinquent student loan debt had surpassed that of credit card balances, nationally. Further, an Education Sector study published in 2013 reports that student loan default rates have actually surpassed graduation rates at more than 500 American colleges and universities.

The financial mentality that students have developed where their confusion leads to inaction and/or denial has far-reaching repercussions that extend way beyond their student loan debt and into every aspect of their financial well-being.

This issue and the implications of these numbers becomes increasingly significant when placed within the context of the environment that young adults now face after graduation: a competitive job market, rising personal debt, and a complex, credit-dependent world economy that puts huge pressures on students and graduates to plan and manage their financial future. The big picture repercussions of the nation’s financial literacy deficiency are reflected in correlating statistics found in the 20-29 year old demographic:

$26,000: Average student loan debt for class of 2013 (CNN Money 2013)

$35,200: Average amount of college-related debt for class of 2013 (Fidelity survey of 750 college graduates)

$45,000: Average debt for those 20-29; includes everything from cars to credit cards to student loans to mortgages (PNC financial independence survey, March)

$1,800: Average credit card debt for those 20-29 (PNC financial independence survey, March 2013)

12.4%: Unemployment rate for those 18-29, well above the national rate of 8.2%;  (BLS data, March 2013)

4: States that require at least a one-semester course in personal finance for high school graduation (Council for Economic Education, 2013)

13: States that require a high school course in personal finance (Council for Economic Education, 2013)

60%: 18- to 34 year-olds not keeping a budget (NFCC financial literacy survey, 2012)

81%: College students who underestimate how long it will take to pay off a credit card balance. (Council for Economic Education, 2013)

30%: Amount of income the average 18-24 year puts towards debt repayment (Council for Economic Education, 2013)

What can be done?
Experts say teaching students about what their repayment options are before they take out loans can help reduce debt.

“It comes back to a financial literacy issue and making sure students understand what they’re getting into, how much they’re borrowing and understanding there are different options for them at the end,” says Megan McClean, director of policy and federal relations at the National Association of Student Financial Aid Administrators.

President Barack Obama pledged in a speech in August that the Department of Education will reach out to struggling borrowers by encouraging them to enroll in income-based repayment plans. Of the millions of federal loan borrowers currently in repayment, roughly 10 percent are enrolled in one of these plans, according to the Consumer Financial Protection Bureau. When you compare the 10 percent enrollment rate to the number of students going into default, it is clear that these programs are hardly being used to their full advantage, and that is due to the simple fact that students just don’t know about them. It’s imperative that borrowers are getting valuable and up-to-date information about repayment options before they get to the point where they find themselves defaulting. The key is letting students know that these plans exist.

But default rates are only a small part of the financial illiteracy equation. Financial education should start much before the college level, extend much further than the immediate post-graduate level, and cover a much wider base of information than just student loan topics. The level of knowledge needed to understand the principles of student loans, debt, and borrowing evolve from much simpler financial concepts that can be easily introduced, taught and learned at the K-12 level. And according to a Bank of America sponsored poll from Harris Interactive last month, a nearly unanimous 99% of adults now agree that personal finance should be taught in high school.

Several states—including Tennessee, Virginia, Missouri and Utah—have mandated that financial education be included in K-12 curriculum, but in the states where this education is mandated, less than 20 percent of teachers feel competent enough to teach the material, indicating the financial illiteracy issue is not just a student problem.

Shannon Schuyler is the corporate responsibility leader at PricewaterhouseCoopers (PwC), an accounting firm that promotes financial literacy among K-12 students and teachers. Through her company, Schuyler tries to spread the message of the importance of financial literacy and emphasize how it can help individuals lead better lives in the future.  If students understand the financial playing field before choosing a college, they might have a better grasp of the consequences of massive amounts of debt and the effect it can have on their life down the road, like where they are able to live, what type of lifestyle they are able to afford, and even how soon they can get married or start a family.

Again, the numbers can back this up. American Student Assistance, a non-profit organization, conducted a recent survey with shocking results. Nearly three-quarters of students said they’ve put off saving for retirement because of student debt; 43 percent said they’ve delayed starting a family and 27 percent said they found it difficult to buy daily necessities because of loan payments; and close to 70 percent said they were confused about the different loan repayment options.

Financial literacy proponents and experts, Schuyler among them, are confident in the idea that educating students sooner about the cost of college, how much they need to borrow, how to repay loans and what their future earnings may look like could help solve this problem.

Now, more than ever, it is important to encourage financial literacy by empowering our nations’ students with the educational tools and resources necessary to strengthen their understanding of proper money management habits and prepare them for a successful future of financial health.

This post was provided by Rob LaBreche, founder and CEO of iGrad, who was a guest on College Smart Radio “Tackling the Runaway Costs of College” on October 19th, 2013.  Listen to this broadcast on YouTube here.

Photo Credit: Chris Potter

Drunk on Credit and a Vanishing Work Ethic

6881508144_3a4dd3c74a_bWhy does it seem so hard to teach kids about money these days?  It seems no matter what anyone does, it just doesn’t seem to be sinking in.  But, why?

A major part of the problem is that we have a financial culture that is sending mixed messages to kids.  The culture seems to scream – Buy now, pay later, and save never.

It’s becoming an annual occurrence in America to talk about raising the debt ceiling and shutting down the government because of a crushing national debt.  The country is drunk on credit!  16.7 trillion dollars in debt and continuing to rise each day.  The CBO projected in February that the government would spend $223 billion just on net interest payments this year.  Sure!  We’ll have a few more drinks… keep ’em coming!

With that toxic credit environment as a backdrop let’s talk about the other part of the problem – a vanishing work ethic among young people.

Parents aren’t perfect either.  Many parents are living beyond their means and racking up sky high debt- sending the wrong message to their kids as well.  They are saying “do as I say, not as I do.”  Credit card debt in the U.S. is weighing down on parents, with the average balance at an astounding $7,200.

By forking over money willy-nilly, not expecting contribution around the house and allowing the electronic babysitter to take over far too often, well-meaning parents are in essence setting a trap for their kids that sucks the work ethic right out of them.

If parents continue being “ok” with these dangerous trends they shouldn’t be surprised when little Johnny is living in the basement at 32, eating their food and expecting his laundry to be done for him.

I believe that the majority of parents want what’s best for their kids, deep down in their hearts.  They really do.  They just don’t have the right tools to help them. is one of the tools that parents are now using to help combat these trends that are robbing their children of work ethic and making it really hard to obtain the money skills they need to navigate through life’s important decisions.  In just 2 1/2 years over 500,000 members have signed up for this free service.

The country seems drunk on credit and work ethic among kids is vanishing at an every increasing pace.  But there is a silver lining.  Some parents still care enough to seek out the right tools to help them in this important battle.

Visit and read my book. My phone number is (888) 907-7121.

This post was provided by Gregg Murset, Founder and CEO of My Job Chart, who was a guest on College Smart Radio “Tackling the Runaway Costs of College” on October 12th, 2013.  Listen to this broadcast on YouTube here.

Photo Credit: Tax Credits

What You Need to Know and Do about Paying for College: Six Essential Tips


When thinking about paying for college, parents often worry most about what they don’t know. College financial aid is a complicated topic, with an alphabet soup of acronyms and jargon. They fear making a mistake that will ruin their child’s future. Despite the complexity, there are only a few things that most families must do to secure their child’s future.

1. Start saving for college as soon as possible. Every dollar you save is about a dollar less you’ll have to borrow. It’s never too late to start saving, because it is literally cheaper to save than to borrow. Every dollar you borrow will cost about two dollars by the time you repay the debt.

2. Start searching for scholarships as soon as possible. Every dollar you win is about a dollar less you’ll have to borrow. There are many scholarships with deadlines in the fall of the senior year in high school, and several that can be won in younger grades, even in elementary school. Search for scholarships for free at web sites like and Answer all of the optional questions for about twice as many matches.

Apply for every scholarship for which you are eligible. Winning a scholarship depends as much on luck as it does on skill. By applying to more scholarships, you increase your chances of winning one. Students often dislike applying for scholarships that involve lower award amounts (e.g., under $1,000) or writing essays. But these are easier to win because they are less competitive, the amounts add up, and they add lines to your resume that can help you win bigger awards. It also gets easier after your first half-dozen scholarship applications, since you will be able to reuse your essays, tailoring them to each new scholarship sponsor.

Beware of scholarship scams. If you have to pay money to get money, it’s probably a scam. Never invest more than a postage stamp to get information about scholarships or to apply for scholarships.

3. File the Free Application for Federal Student Aid (FAFSA) every year, even if you think you won’t qualify for financial aid. The FAFSA is used to apply for financial aid from the federal and state governments and all but about 250 mostly private colleges. It is also a prerequisite for low-cost federal education loans, which you can borrow even if you are wealthy. File the FAFSA as soon as possible after January 1. Several states are on a first-come, first-served basis, awarding state grants until the money runs out. (California’s deadline is in early March.) Do not wait until you are admitted or have filed your federal income tax returns.

It is ok to estimate income based on W-2 and 1099 statements and/or the last pay stub of the year. You will have an opportunity to correct any errors later. You can file the FAFSA for free at Use the IRS data retrieval tool to update your FAFSA information a week or two after you file your federal income tax return. Call the US Department of Education’s federal student aid information center at 1-800-4-FED-AID (1-800-433-3243) with questions about federal student aid and filing the FAFSA.

4. Compare colleges based on the net price, the difference between the total cost of attendance (tuition, fees, room and board, books and supplies, etc.) and just grants (money that does not need to be repaid). This is the amount you’ll have to pay from savings, income and loans to cover college costs. It is a more accurate measure of the bottom line cost. But beware of two caveats: about half of colleges practice front-loading of grants, yielding a lower net price for freshmen than for upperclassmen, and a college’s outside scholarship policy dictates whether private scholarships are used to replace loans (yielding a lower net price) or the college’s own grants (no change). Relying on the net price will help you make a more informed decision about the tradeoffs between college affordability and other considerations, such as college quality and reputation.

5. Borrow as little as possible. You can economize on college costs by enrolling in a less expensive college, such as an in-state public college or a college with a generous “no loans” financial aid policy. But tuition represents only about half of college costs. Students can also save by buying used textbooks (or selling the textbooks back to the bookstore at the end of the term), living at home with their parents, minimizing trips home from school and economizing on everyday expenses. For example, students don’t like the cafeteria food and so tend to eat out a lot. But a $10 pizza a week will cost you about $2,000 over the course of a four-year college career. If you pay for that pizza with student loan money, it will cost you about $4,000 by the time you repay the debt. So live like a student while you’re in school, so you don’t have to live like a student after you graduate.

Keep your debt in sync with your income. A good rule of thumb is that total student loan debt at graduation should be less than your annual starting salary, and ideally a lot less. If total debt is less than annual income, you will be able to repay your loans in ten years or less. Otherwise you’ll struggle to make your monthly loan payments. Parents should borrow no more for all their children than they can afford to repay in ten years or by retirement, whichever comes first.

As an alternative to student loan debt, consider a tuition installment plan. These spread out the costs over 9-12 equal monthly installments. Tuition installment plans don’t charge interest, but do have up-front fees that are typically less than $100. They are a good way of avoiding long-term debt.

If you must borrow, borrow federal first. Federal student loans are cheaper, more available and have better repayment terms than private student loans. Federal student loans have low fixed rates, while private student loans tend to offer variable rates. Variable rates may initially have lower rates, but those interest rates have nowhere to go but up. Federal student loans also offer income-based repayment and public service loan forgiveness, while private student loans do not.

6. Don’t forget about the education tax benefits, such as the American Opportunity Tax Credit (AOTC), because these are claimed when you file your federal income tax return instead of when you pay the college bill. These tax credits give you up to $2,500 back based on amounts you paid for tuition and textbooks.

This post was provided by Mark Kantrowitz, the Senior Vice President and Publisher of, who was a guest on College Smart Radio “Tackling the Runaway Costs of College” on October 5th, 2013.  Listen to this broadcast on YouTube here.

Photo Credit: Edvisors

Applying for College Financial Aid Is Not As Scary As The Monster Under Your Bed

The Department of Education

The Department of Education’s new website can help families with financial aid.

When you were a kid, were you afraid of the dark and the monster under your bed? Well, if you think that applying for college financial aid is like the monster under the bed, I’ve got good news for you, you can tame the monster if you understand the process.

First, let’s look at the most common myth about the college financial aid process: “We don’t want to apply for financial aid because we make too much money and my son or daughter won’t qualify for financial aid. Wrong! There are three basic categories of financial aid: need-based aid, non-need based aid, and merit aid (scholarships). Even if you are lucky enough to make a good living, your son or daughter is at least eligible for a non-need based federal loan (Unsubsidized Direct Stafford Loan). If your student is a high achiever, she or he may get a merit based scholarship to help with the cost of college.

Let’s take a short look at the process.

Federal and State Financial Aid
Applying for federal and state financial aid is easier than you think. The U.S. Department of Education has created a very good web site: This site has great information about the application process, the types of financial aid, and student loan repayment plans.

To apply for federal and state financial aid, the student (and at least one parent for 18-24 year olds) must get a PIN and then fill out the Free Application for Federal Student Aid (FAFSA) on the web beginning in January of the year that the student wants to attend. Huh? If your high school student is graduating in June, apply for financial aid with the FAFSA in January of that year.

You can list several colleges and universities on the FAFSA. Once the on-line FAFSA is filled out and submitted (and signed with your PIN), the FAFSA record will be sent to each college listed. Colleges across the country receive FAFSA application records and begin to process applications by about March of each year. Many colleges may send your student an award letter (offer of financial aid) by March – some colleges may send awards earlier. The FAFSA determines how much your family can afford to pay for college for one year. This amount is called the Expected Family Contribution (EFC). The college establishes each student’s need by subtracting the EFC from its cost of attendance. Depending on the student’s eligibility, the college will offer need-based federal and state aid up to the student’s need. Additional non-need based aid may be offered to the student and parent up to the cost of attendance at the college. The college can offer state aid because your state’s grant authority gets information from the FAFSA also.

Need Based Aid Non-Need Based Aid
Pell Grant Federal Unsubsidized Stafford Loan
Supplemental Educational Opportunity Grant Federal PLUS (parent loan)
Federal Work Study Federal GradPLUS (graduate students only)
Federal Perkins Loan Merit Based Scholarships
Federal Direct Subsidized Stafford Loan School Tuition Discounts
State Grant Athletic Aid (may have a need component)
School Tuition Discounts (need or non-need)

Accepting Financial Aid and School Processing
Generally, schools offer financial aid to students early so that families will know the amount of aid to expect. The process is not finished at this point. A student and parent may have to answer questions about the FAFSA and provide information to the school to document the data on the FAFSA. A student will have to accept the offer and the student who wants to borrow in the loan programs will have to complete an on-line entrance interview and master promissory note. Parent borrowers will have to complete a promissory note. Once everything is in place, the school with disburse funds to the student’s account at the beginning of fall semester.

Is It Really That Simple?
Not quite, but this is a short article! Remember the best source of information about the financial aid process is the college’s financial aid staff. If you can, visit the schools that you are interested in and talk to the financial aid staff. They will explain their process and make sure you can complete the process in time for your financial aid funds to be ready on the first day of the semester. Remember that students must fill out a FAFSA for every year they attend school and want to get federal and state financial aid.

This post was provided by Sam Collie, a senior consultant for Evans Consulting Group, who was a guest on College Smart Radio “Tackling the Runaway Costs of College” on August 3rd, 2013.  Listen to this broadcast on YouTube here.

Photo Credit: DonkeyHotey

Student Loan Rates Increase, Underscore Skyrocketing College Costs

With increasing interest rates, student loans are a heavy burden on many college graduates.

If the fed doubles the interest rate on student loans, but nobody takes out one of those loans, did the cost of college still go up?

The answer is yes. If that brain teaser seems complicated, that’s because it is. So let me simplify what the rate increase means and explain the options for managing the rising cost of tuition.

Congress agreed last year that the federal government’s interest rate for subsidized student loans would balloon from 3.4% to 6.8% if they weren’t able to set a new rate by July 1, 2013.[1] Despite a flurry of negotiations, Congress hasn’t been able to find a compromise. Today the 6.8% rate is a stark reminder that college costs only go in one direction. Unless a deal is reached, students and parents should expect to pay an extra $1,000 for loans and some experts say that number is closer to $2,600[2].

For now, this huge swing has left families in a difficult spot and more expensive loans underscore the challenge of paying for college in the first place. The Merrill Edge Report for Spring 2013 found that families who have their financial acts together—some assets and some money in the bank—plan to use a mix of sources to pay for their children’s education. That mix includes federal loans.

No matter what stage of life you are in—grandparent, parent, 20-something, or teenager—you need a plan in place to pay for college. Here are six ways to start:

  1. Together, set a clear goal. Estimate what percentage of your child’s college expenses you hope to pay for. In the past decade, the cost of a four-year school rose 5.6% per year, far outpacing inflation.[3]
  2. Look at other families’ strategies for context. You don’t have to be the sole funder of your child’s education. Most families use a combination of savings, gifts, grants, scholarships and loans.
  3. Start saving as early as you can. The sooner you begin, the greater your chances of reaching your goal.
  4. Talk with your kids. To avoid surprises, talk with your kids about college costs and expectations when they’re young.
  5. Explore financial aid. Since you have already agreed how much you will contribute to your child’s education, you can look for scholarships, work-study programs and grants as college approaches.
  6. Consider investing in a Section 529 plan. Contributing to a 529 plan could potentially have significant tax advantages. If appropriate, let relatives know they can open a 529 plan as an estate planning tool and designate a beneficiary.

Finally, the best thing you can do is talk to a qualified financial professional who can lay out what the recent rate increase means for your family in the short term, and help you make sense of college savings for the long term.

Wesley G. Gunter is a Financial Solutions Advisor with Merrill Edge which offers team-based advice and guidance brokerage services. He can be reached at (949) 616-1297 or via email Merrill Edge is available through Merrill Lynch, Pierce, Fenner & Smith Incorporated (MLPF&S), and consists of the Merrill Edge Advisory Center (investment guidance) and self-directed online investing. MLPF&S is a registered broker-dealer, member SIPC and a wholly owned subsidiary of Bank of America Corporation. Investment products are not insured by the FDIC; not deposits or other obligations of any bank and are not guaranteed by any bank; and are subject to investment risks, including possible loss of the principal invested.

Wesley Gunter was a guest oCollege Smart Radio “Tackling the Runaway Costs of College”  on July 27th, 2013.  Listen to this broadcast on YouTube here.

Stafford Student Loans – How Much do they Really Cost?

3.4% versus 6.8%. It Matters.

3.4% versus 6.8%. It Matters.

When going to college, financial aid can be a scary and intimidating process. With unfamiliar terms and long lengthy processes, applying for and accepting student loans can make the transition to college a bit complicated. Traditionally, there are two common forms of federal student loans that are made available to undergraduate students; subsidized and unsubsidized Stafford loans. The college determines the actual loan amount you are eligible to receive each academic year. However, there are limits on the maximum amount in subsidized and unsubsidized loans that you are eligible to receive each academic year and over your academic career.

Subsidized Stafford Loans

These student loans are based on financial need and do not rack up interest while students are attending a college or university at least half time. What this means is that the government will take on the task of paying any interest that is collected on your loan while you are in school or in deferment periods. Subsidized loans have various loan limits ranging from $3,500 to $5,500 a year and are federally guaranteed.

Unsubsidized Stafford Loans

As you can imagine an unsubsidized loan is opposite of a subsidized one. These loans are not based on financial need alone and do collect interest while you are in school or in a period of deferment. As with the subsidized loans, there are limits ranging from 2000 to $7,500 depending on the academic year.

If you are a dependent student whose parents are ineligible for a Direct PLUS Loan, you may be able to receive additional loan funds of an additional $4000 to $5000 per academic year.

In order to apply for any student loan, you must fill out a FAFSA every year that you are applying for federal financial aid. This form can be found online and should be completed once per year. It will be sent to all the schools of your choice simply by entering the school codes on the college selection section of the FAFSA form.

Whether you are headed to college in the fall for the first time or starting your senior year of high school, be sure to apply for federal financial aid early in January of each year.

For more resources and help, listen to the archive of College Smart Radio Tackling the Runaway Costs of College on June 15th, 2013.  Listen to this broadcast on YouTube here.

SoFi is Connecting Student and Graduate Borrowers with Alumni Investors

The rising cost of tuition, combined with decreasing earnings, is a big reason why people are concerned about student loans. And it should be. With student debt levels and delinquencies at all time highs, it has become essential for prospective and current college students to determine whether their degrees are worth the cost of tuition and amount of debt they will need incur.

College Tuition vs Earnings for College Graduates

College Tuition vs Earnings for College Graduates

This visualization of trends in tuition and wage growth is certainly troubling, and it is clear this is not sustainable. But how did we get into this position and what can we do to make it better?

The Problem

The federal loan programs were developed with an important mission – to ensure students could afford a college education regardless of the cost. While these programs have successfully enabled many students to achieve their goals for higher education, the unintended consequences of the policies are largely responsible for the student loan crisis and rising cost of tuition.

By allowing students to borrow up to the cost of attending school, the government perpetuates tuition inflation. Without a cap on tuition, universities have less incentive to keep costs down and avoid expensive capital projects. Schools are compelled to spend on state of the art fitness facilities and all-you-can-eat sushi bars to attract the best students and the government is tuition-price-blind when lending money for college.

Keeping tuition costs down is also a challenge because universities are not held accountable for producing successful graduates. Tuition prices are rising as a result of university costs increasing – not because the value of the education is improving. The price of a degree is not necessarily connected to the outcomes it produces – graduation rates, jobs, future earnings. In the current system, schools are not at risk of losing money if students don’t get well-paying jobs – that falls on the government and the taxpayer.

A Private Sector Solution

The private sector is perfectly positioned to enter the student loan space and correct some of the problems of this inefficient marketplace. Private lenders could solve the incentive problem of universities and hold schools accountable for the success of their graduates.

SoFi’s model is one example – a community-based lending model in which alumni invest in a loan fund for current students and recent graduates. Successful graduates willing to invest in their alma mater is a clear indicator that tuition is priced appropriately and that education is a good investment for borrowers and lenders.

A focus on financial education is also an essential component for reigning in runaway tuition costs. All constituents must be involved in this process – from financial aid offices to parents, from private lenders to the government – students should have the information to decide for themselves whether a degree -and the loans they’d take out to fund it – are worth it to them. SoFi has created a Know Before You Owe Calculator to help students understand how their choice of school, major, and city of residence impact their ability to repay their loans.

If the cost of tuition continues to rise as wages decrease, many students will pay more for school than they can ever expect to recoup – a reality that will have significant consequence for individuals and taxpayers as a whole. The private sector must take on more of the student loan market to fix the inefficiencies or the U.S. economy will continue to suffer.

This blog was provided by Dan Macklin, Co-Founder & VP Alumni Relationships at SoFi. Dan Macklin was a guest on College Smart Radio “Tackling the Runaway Costs of College” on March 30th, 2013.  Listen to this broadcast on YouTube here.

Photo Credit: Business Insider