Mom- the reasons for the college loan crisis are manifold and quite complex- and there’s a LOT of research that shows that a small number of borrowers carry a huge and debilitating amount of debt-- but the typical borrower is responsible, pays off their loans on time AND end up in a far better place economically than if they hadn’t borrowed.
I borrowed for a graduate degree- and in 19 months (accelerated my two year program to cut down on the amount of time I would spend without a salary) I tripled my salary. Yes- that was a long time ago. But I’ve got nephews and cousins and nieces with much more recent experience with educational loans and the math is incontrovertible- a niece who was making 42K a year as a paralegal took on the debt for law school, took the big law job, paid off the entire loan after three years with her firm and now earns many multiples of her paralegal salary.
Much of the untold story about educational loans is about the predatory practices of the for-profit colleges. Many of them have changed their names over the last few years so it’s harder to Google them and find out what the story is. But this is not a kid from Indiana borrowing to attend Purdue. This is about kids borrowing for bogus degrees in “Travel and Tourism Management” which qualifies them for customer service jobs at the car rental counter of any airport in the country- a job which they could get with a HS diploma and a clean drug test. These are kids getting four year degrees in “court reporting” (again, you don’t need a college degree to become a stenographer) and four year degrees in criminal justice when a two year AA from a decent community college gets you to the same place- a job as a probation officer. My least favorite of these is the new vogue from the online, private, predatory colleges for degrees in forensics. These kids watch TV and think they’re going to become medical examiners (in my state, you need to be an MD) after taking online classes which teach outdated techniques in saliva and hair analysis.
It’s sad. But taking out loans-- in moderation-- for a legitimate four year college- is what gets thousands of kids out of poverty and into professions.
Buying a $900 cellphone? This I don’t get. Taking out a home equity loan to build a “home theater” in your basement? That’s a foolish use of debt IMHO. But the lifetime differential in earnings for a college degree vs. a HS degree is substantial. And the difference between the earnings of an LPN vs. a BSN-- especially one with advanced training in surgery or cardiac care-- for some kids, that won’t happen without the federally guaranteed loans. Yes- it would be great if kids could work their way through a BA like the good old days. Try stuffing that genie back into the lamp.