New research emphasizes the compromises that many students are being forced to make in this era of escalating expenses and shows that the financial anguish produced by the increased inflation rate has infiltrated campuses throughout the country.
The problem of rising tuition prices in higher education has been building for decades. According to a study conducted by Georgetown University using information from the United States Department of Education, the total cost of an undergraduate education has increased from $9,307 in 1980 to $25,004 in 2019; this is an increase of 169%. Tuition alone has more than doubled from $17,045 to $24,623 between the 2008-2009 and 2018-2019 school years.
Many four-year public colleges have recently increased tuition by as much as 5% for the 2021–2022 school year. This is on top of the average 1.6% increase seen at these institutions over the last few years. Intelligent.com recently polled 1,000 college students to find out how a 5% tuition increase for the coming academic year will affect their education.When asked how a 5% hike in tuition would affect their financial situation, 91% of students said it would have a moderate (42%), severe (49%), or no impact at all. 9% said it wouldn’t have any impact at all.
Respondents said that if tuition were to rise by 5%, they would either work more hours at their current job (59%), look for a second job (47%), cut down on entertainment (46%), or cut back on groceries (35%). Students’ most severe answers included taking out more loans (24%), dropping certain courses (17%), and dropping out of school (5.6%). “Since studies show that the majority of college dropouts don’t end up returning to school, the students who do drop out due to inflation-based tuition increases will enter the workforce already having student debt but without the degree to accompany it,” said the Intelligent.com report.
A recent survey by Bankrate found that more than 43 million Americans currently owe more than $1.7 trillion in federal student loans.
The typical student borrower has $28,400 in debt, with federal loans accounting for 92.3% of the total and private loans accounting for 7.61%. When it comes to consumer debt, student loans are second only to mortgages, as reported by Bankrate.
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) put a temporary hold on federal student loan payments and collections actions during the pandemic in an effort to alleviate some of the financial hardship caused by the crisis. That, however, will end on August 31st of this year.
According to the United States Office of Federal Student Aid, the federal CARES Act covers more than 99 percent of all forbearance amounts.This affects almost 25 million direct loan students.
There were 497,700 borrowers in Connecticut carrying $17.5 million in federal student loan debt as of December 31, 2021. This equates to an average of $35,162 in debt per borrower. About 2.4 million New Yorkers are carrying a total of $92.7 million in federal student loan debt, or $37,678 on average. “Paying for college isn’t getting easier, and student debt can impede borrowers’ ability to buy homes, get married or expand families,” said Hannah Bareham, author of the Bankrate data study. “Student loan debt can have a significant impact on a borrower’s mental health. Feelings of anxiety and stress may coincide with any long-term debt, especially if the debt impedes the ability to meet important financial milestones, like saving for a house or buying a car.”
The following article is paraphrased, its original publication can be found here: Inflation forces college students to reconsider their education, Phil Hall, August 13, 2022, https://westfaironline.com/151764/inflation-forces-college-students-to-reconsider-their-education/