I don’t know what it is about my generation, but we can be really stupid sometimes.
For some inexplicable reason, current college students have a massive blind spot when it comes to student loans. Nearly half of the participants in a recent poll believe they won’t have to repay them after graduation.
LendEDU recently conducted a survey of 500 current college students in which 49.8 percent (!) of participants believe they will “receive federal forgiveness on their student loans after graduation.” What these students don’t seem to realize is that loans are only forgiven in unique circumstances.
According to the U.S. Department of Education, federal direct student loans can be forgiven if the borrower is hired for a public service job for a specified amount of time, agrees to teach in an underserved area, dies or becomes permanently disabled, or if the school they attends closes while they are enrolled or within 120 days after they leave. Are you gunning for that open sanitation job anytime soon? Didn’t think so.
“The biggest exemption is the Public Service Loan Forgiveness Program, and very few students go into public service,” Nate Matherson, who co-founded LendEDU in 2014, explained. “With maybe 14 percent of the American workforce in a public service job, the actual numbers of those who may qualify for student loan forgiveness or discharge is maybe below 10 percent. The fact that many students do not understand this means that they may be significantly underestimating the cost of financing a college education,” he continued.
The lack of understanding is a real problem, which is why certain universities are taking active steps to better educate students and their families about the specifics of financial aid.
Mark Stephen, the financial aid director at Pace University, says he conducts 25 or 30 workshops in high schools every year in addition to online tutorials. The “sticker price” for annual tuition for the 2017-18 academic year at Pace is $42,354. That’s roughly 2014 Infiniti Q50.
“It’s not very realistic at all to expect loan forgiveness,” he said. “We try to tell students to understand your loan and manage your spending.”
“Generally students are pretty well aware about financial aid by the time they come,” MJ Knoll-Finn, vice president for enrollment management at NYU, said. The 2017-2018 tuition and fees at NYU add up to $49,062. “There’s a lot of information out there for students.”
“We consider college an investment,” Knoll-Finn said. “We want them to go into this with their eyes open. We always say ‘take out only those loans you think you can pay back.”
This is America, kids. You can’t just ask someone for a ridiculous amount of money in exchange for absolutely nothing in return. How do you expect to survive the real world when you cant even make it through college? Yeesh.