This was an interesting topic on the CBS Early Show a few weeks ago. Right off the bat I wasn’t surprised to learn that the average tuition for a public university is $56,000 while a private university’s tuition is 2.5x as much at $140,000. I was surprised to learn that the amount of college debt Americans are carrying is 830 billion dollars. This is almost 5 billion dollars more than the national credit card debt! To make matters worse, the unemployment rate for college students is at a record high 5% in an economy, which we all can agree, is still for the most part struggling. Another scary fact is that collections are the harshest for college debt than for any other kind of debt. I should rephrase that…Any other kind of LEGAL debt. If you’ve ever seen Rounders, you know never to borrow money from Teddy KGB.
Intrigued, I continued to watch and as the so-called “expert” panel on CBS is taking just-waking Americans through the bleak options they have if they are parents of soon to be collegiate matriculators, I couldn’t help but wonder why? WHY are you suggesting that someone’s kid take a “gap” year which would entail them working their butt off at Carvel just to save enough money for school? Taking a year off to party or travel sounds fun (excluding Hostel) but a year to do hard time earning minimum wage just so I can afford books? I’d rather date a nerd and make photo copies.
The other option is to send your kid to community college for 2 years so they can work their butt off trying to earn good grades and get into a 4-year school. This actually sounds good in theory, but as often the case, these kids enroll in classes part-time so they can work a job the other part of the time (you know who you are S. Setauket Park). When they start to earn some money they put more time into the job than their studies. One day they wake up, 4 years have passed and they have 24 credits and a 16k dollar debt. Damned if you do, damned if you don’t. You want your child to take on responsibility, but with this responsibility looms the possibility they will find greater value in work than school.
I honestly would hate to be in high school right now mapping out my path for the future. What should be a fun and exciting time has turned into a Venn Diagram of pro’s and cons with financial debt encompassing the overlapping circle in the middle. Here’s an idea – because the economy is still in turmoil and unemployment is at a record high for graduates, why don’t universities lower tuition? 9/11 aside, I never thought rent would go down in Manhattan, but it has. Colleges should take a cue from the real estate market and give students and parents a break. This might even enable graduates to go back to school. More grads in grad school means less in the job market, decreased competition and more opportunity for everyone else.
Whether this will work or not, who knows? What I do know is that something needs to change. Like the BCS for college football, the current system just ain’t working. A college grad fresh outta school with no job prospects and 40k in debt is one big Shaq-step closer to Falling Down than they are to Wall Street (the original of course).