I was just reading a story in the New York Times about the massive student loan debt being incurred by students. They are deeming it another looming financial crisis and I’m guessing they are correct.
Since students are leaving school often with $50,000-$100,000 in debt, I used a student loan interest calculator to crunch some numbers. If a student today were to incur $100,000 in student loan debt (which is not hard to do – I have many friends with that amount in student loan debt), at today’s interest rates, and hoping to pay it off within 20 years of leaving school, the monthly payment would be $763. That’s a $763 payment every single month for 20 years!
That also means the total cost of that education was not $100,000, but actually $183,000 because $83,000 in interest would accrue over that time.
Think of how insane it is that we are putting students in this situation. Think of what we are burdening students with for the bulk of their working adult lives. And many of these students will leave college with degrees that might not even get them anything more than an entry-level position anyway. Something has gone very wrong in our higher educational system. Very wrong.