Tuesday, December 31st, 2013
A growing number of young adults are stuck in what analysts are calling a “worst case scenario,” in which they are stifled by debt from college loans, but they never finished their degrees. More from NBC News:
According to a 2011 study by the Harvard Graduate School of Education, only 56 percent of students who enter four-year programs graduate within six years. That number plunges to 22 percent for for-profit colleges. Meanwhile, the percentage of incoming students relying on loans is growing—from 2001 to 2009, the number increased from 47 percent to 53 percent, according to a report by Education Sector. The same report also found that borrowers who drop out are four times more likely to default on their loans.
Some of these dropouts grew up middle class with an expectation of getting a degree, like [Christopher and Harmony] Glenn. Others are students from low-income backgrounds, perhaps the first in their families to go to college. Michelle Obama recently launched an effort to encourage these first-timers to pursue higher education, but the odds are stacked against them: Pell grants and funding for state and city universities continue to shrink. Forty percent of students at four-year colleges, and 60 percent at community colleges, are working 20 hours or more to make up for these gaps, according to the Pell Institute.
“A lot of these kids come up against this wall of bureaucracy,” said Jennifer Silva, author of Coming Up Short, a book about working-class young adults. “They lack mentors to help them navigate the system” of admissions, financial aid, and choosing classes. “It ends up leaving them feeling kind of betrayed.”
Image: College debt, via Shutterstock
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Monday, April 23rd, 2012
Half of recent college graduates are either unemployed or working at jobs that don’t fully use their skills and knowledge, an analysis of government data by The Associated Press has found. Young adults are, instead of putting their degrees to full use, increasingly parsing together lower-paying jobs in an attempt to keep up with student loan payments and cost of living. From the AP:
Opportunities for college graduates vary widely.
While there’s strong demand in science, education and health fields, arts and humanities flounder. Median wages for those with bachelor’s degrees are down from 2000, hit by technological changes that are eliminating midlevel jobs such as bank tellers. Most future job openings are projected to be in lower-skilled positions such as home health aides, who can provide personalized attention as the U.S. population ages.
Taking underemployment into consideration, the job prospects for bachelor’s degree holders fell last year to the lowest level in more than a decade.
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“I don’t even know what I’m looking for,” says Michael Bledsoe, who described months of fruitless job searches as he served customers at a Seattle coffeehouse. The 23-year-old graduated in 2010 with a creative writing degree.
Image: Graduation caps, via Shutterstock
Friday, March 30th, 2012
A growing number of American families are seeking loans for education long before their kids even apply to college. According to SmartMoney.com, families are applying for school loans when their children are as young as 5 years old:
Though data is scarce, private school experts and the small number of lenders who provide loans for kindergarten through 12th grade say pre-college loans are becoming more popular. Your Tuition Solution, one of the largest lenders in this space, says demand for the upcoming year is already up: This month, the total dollar amount of loans families requested rose 10% compared to a year ago; at that pace, the company expects its total funding to rise to $20 million for 2012-13. Separately, First Marblehead, which exited the market in 2008, reentered last year as demand for loans began to rise.
Much of this demand is coming from high-income families. Roughly 20% of families that applied for aid to pay for their children’s kindergarten through 12th grade private school education had incomes of $150,000 or more, according to 2010-11 data, the latest from the National Association of Independent Schools. That’s up from just 6% in 2002-03. Those who don’t get approved for free aid, like grants, increasingly turn to loans, experts say.
Image: Kindergarten class, via Shutterstock
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