Student debt on the rise

Posted by Ben Unglesbee

December 5, 2013 at 12:53 p.m.

In Kansas and across the country student debt is on the rise, though the debt burdens of Kansas students are, as you might expect, smaller.

A new report from the Institute for College Access and Success, a nonprofit focused on college affordability, shows more than 70 percent of college seniors who graduated in 2012 left school with student loan debt.

That's a lot of indebted graduates. More troubling is that the average debt among them has grown. For 2012 the average debt load was $29,400. That number has been on the rise for several years, ticking up about 6 percent per year on average.

Kansas students are in a bit better shape. In 2012 the average debt taken out by KU students was $23,468, almost $6,000 less than the national average reported by College Access and Success, though that number has also risen from 2008's average of $20,902. For all students graduating from a public university in Kansas, the average debt load is $23,000, according to figures from the Kansas Board of Regents.

While those figures are far better than the national average, and while acknowledging that an average masks very different experiences across students, even Kansas' lower student debt figures could be a problem, especially for lower income students.

In a recent conversation with William Elliot, a KU associate professor of social welfare and the founding director Assets and Education Initiative, Elliott said that student debt burdens even below $20,000 can affect the long-term financial prospects of lower income students. Moreover, the prospect of debt can discourage loan-averse students from enrolling in 4-year programs or from going to college altogether.

To address the problem Elliott and others have advocated for encouraging college savings accounts and even restructuring federal financial aid to more of a savings model. Others are looking sharply at debt and graduate income levels to measure the value of a college education. And still others are just generally freaked out about the $1 trillion in outstanding student debt U.S. adults are trying to pay off.

And I'm proud, sad and frightened to say I'm among them. That's why I need your KU news tips to keep the show going. Send them along to bunglesbee@ljworld.com

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Richard Heckler 3 years, 7 months ago

The Last Mystery of the Financial Crisis -The topic? Student loans.

Obama eliminating private banks and lenders from the federal student-loan business was a smart move. The problem for students however is much much larger.

But the dirty secret of American higher education is that student-loan interest rates are almost irrelevant. It's not the cost of the loan that's the problem, it's the principal – the appallingly high tuition costs that have been soaring at two to three times the rate of inflation, an irrational upward trajectory eerily reminiscent of skyrocketing housing prices in the years before 2008.

Yes when home real estate values were inflating beyond reality between 2001 and 2008 so were numbers attached to college tuitions . My my what a great time for a few to profit big time apparently while the same

Regulators were turning blind eyes to the home loan fraud schemes meanwhile other schemes were also underway.

Those schemes were providing massive financial backing to massive tuition increases with unlimited student loan $$$$$$ that would ultimately match the price of wildly inflated home prices. The primary difference is the loans were being approved without real live collateral.

All the while zillions of USA jobs are being smuggled abroad under the guise of the New World Order Global Economy.

Tons of debt being loaded on the backs of students with wage scales that might take 40 years to pay back. Where has this money been coming from and why in the hell have college tuition rates been allowed to go through the roof.

Were there any regulators on duty between 2001 and 2008? Our student population has been getting ripped unbeknownst to them. In essence victims of some whopping money making schemes involving both educational and financial institutions so I speculate. During the same period as the home loan debacle.

How did college become so expensive?

Richard Heckler 3 years, 7 months ago

Why hasn't congress spent some time FIXING this situation is the big question? Of course any acceptable resolution will be met with the same group of obstacles aka right wing GOP.

Must be time for students and parents to submit massive numbers of lawsuits because congress does not know that it's time to forgive a ton of debt and put some money makers behind bars.

John Graham 3 years, 7 months ago

A major factor in tuition rates growing faster than other aspects of cost of living is the significant increase in the growth of full time administrators and staffers at universities. The ratio of student to professor has remained about the same over the past 40 years but the ratio of students to administrators and staffers has dropped significantly. There are now more administrators and staffers at a university than professors, which is the opposite of historical data.

Also the advent of more and easier to get govt grants and loans has encouraged universities to increase tuition. The universities don't really care where the money comes from. The universities could also help the situation by being more selective in admissions. Most universities, except for the truly elite, are happy to admit students that are not prepared for college level work in order to get more tuition money even if the student is likely not going to be able to finish college. Universities admit students that have to take remedial math and English classes that don't count towards college credit. It means the student may need an extra year or two at the university which the university loves due to more tuition. They don't care if the flunked out student now has a bunch of loans they will likely not be able to pay because the university already has the money. Universities have increased the hours needed for some degrees thus increasing the number of years needed thus more tuition. Universities are in the business of generating tuition. The professors are there to teach but the university is there to collect tuition fees. Govt loans and grants have made money easier to get. The universities are happy to raise tuition to maximize profit and spend that profit on administration and staffers more so than professors.

Bob Smith 3 years, 7 months ago

You mean going $100,00 into debt to get an MA in 14th Century Moldavian nose flute is a bad idea because I'll never get a job that requires that degree? Who knew?