Editor's Note (The View From Here)
At What Cost?
- By Deborah P. Moore
- January 1st, 2015
Higher education affects more than the students who attend local colleges and universities. It directly affects the economic development of the region. Business and industry are attracted to locations where the education system creates a well-qualified workforce and a higher standard of living. Communities experience economic growth, lower crime rates, increased participation, volunteerism and charitable giving. Local residents reap the benefits of increased property values. It can be a win-win for everyone — but it doesn’t come cheap!
Spiraling tuition has many students asking the question: Is college worth it? According to the Institute for College Access & Success, in 2012, 71 percent of all students graduating from four-year colleges had student loan debt. Average debt levels for all graduating seniors with student loans rose to $29,400 in 2012, a 25 percent increase from 2008 debt levels. Adding fuel to the fire is the much-debated PayScale data gathered on graduates of more than 900 universities showing that, after factoring in the cost of a degree, students in some colleges can expect to make less than a high school graduate.
The rising cost of a college education has increased our dependence on federal and private loans, as well as the rate of delinquencies and defaults on those loans. From November 2013 through November 2014, the aggregate balance in the federal direct student loan program — as reported by the Monthly Treasury Statement — rose from $687,149,000,000 to $806,561,000,000; a one-year jump of $119,412,000,000. Its report on household debt and credit states, “Outstanding student loan balances reported on credit reports increased to $1.13 trillion (an increase of $8 billion) as of Sept. 30, 2014, representing about $100 billion increase from one year ago.”
As costs continue to rise, so do consequences. Incoming students are reexamining their return on investment and reconsidering what college they will attend — if they will attend college at all. For graduates, having to delay payment or defaulting on their loans is becoming commonplace — a cost to us all. Parents who have saved a lifetime to put their children through college are finding their graduates underemployed and moving back home. Hopefully 2015 will be the year that costs are contained and progress is made — increasing the value of a higher education and making it accessible to all.
This article originally appeared in the January 2015 issue of College Planning & Management.