School Loans

JohnDB

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She owes $581,000 in student loans, and the bill is coming due

Ok...
I've heard of this. I used some Stafford Loans to go through Culinary School and Business School...but it wasn't that much and I didn't have to take reduced payments to get out from under them. I got jobs and paid them off decades ago.

But lately the amounts of money for the type of degrees don't seem to be prudent or logical.

$600,000 for Choiprachter degree... when the job only pays on average 60k per year.
Or $75,000 for an acting degree so you can get bit parts in commercials or plays. (Paying maybe $2,000/yr)

Then there's flying lessons that can go up to $250,000 for tuition alone for a $40,000-$60,000 job as a copilot maybe. (currently sitting on the couch waiting for air travel to resume)

Real Estate Profiteering....some people make money and thousands do not.

There seems to be a huge disconnect between what some of these degrees cost and money borrowed vx what these jobs will produce as income.

But other degrees are more likely to produce... Academic degrees in IT or information management, mathematics, biological chemistry, and writing...even psychiatry.

I'm thinking that there needs to be an overhaul for the program. Maybe student loan forgiveness but maybe not. Maybe a limit for some degrees and maybe not.

What do you think?
 

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I'm in full agreement that we need restrictions on student loan programs especially in regards to for-profit schools. My wife was interested in culinary school and it was $40K, even if you left the program. Typical positions only paid around 25-30K which isnt all that much. I used to teach computer classes (mainly MS Office) at a for-profit school in the early 2000s. Even as dedicated as I was towards my students, and a few did get a step up in jobs, the big sell for the school was loans for single moms. The other big issue that I have is that schools can raise the tuition far exceeding inflation. I cant think of anything else where you don't know the final price for something you are purchasing that you are not guaranteed to own. If you don't complete a program, you walk away with virtually nothing to show for it but the bill. Even if you buy a car and then sell it for a loss, at least you've gotten some value out of the purchase.

I do believe there is a place for vocational programs but from what I saw, most of them are pretty underhanded about things. They require classes that have nothing to do with the program you are in and rarely do their credits transfer to a recognized school. At least with a state technical college, you can transfer those credits into a four year program.
 
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Belk

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She owes $581,000 in student loans, and the bill is coming due

Ok...
I've heard of this. I used some Stafford Loans to go through Culinary School and Business School...but it wasn't that much and I didn't have to take reduced payments to get out from under them. I got jobs and paid them off decades ago.

But lately the amounts of money for the type of degrees don't seem to be prudent or logical.

$600,000 for Choiprachter degree... when the job only pays on average 60k per year.
Or $75,000 for an acting degree so you can get bit parts in commercials or plays. (Paying maybe $2,000/yr)

Then there's flying lessons that can go up to $250,000 for tuition alone for a $40,000-$60,000 job as a copilot maybe. (currently sitting on the couch waiting for air travel to resume)

Real Estate Profiteering....some people make money and thousands do not.

There seems to be a huge disconnect between what some of these degrees cost and money borrowed vx what these jobs will produce as income.

But other degrees are more likely to produce... Academic degrees in IT or information management, mathematics, biological chemistry, and writing...even psychiatry.

I'm thinking that there needs to be an overhaul for the program. Maybe student loan forgiveness but maybe not. Maybe a limit for some degrees and maybe not.

What do you think?

Indeed. There seems to be a huge disconnect between our for profit school system and the results they produce. So, what do you think we should do about it? Should we craft a government solution or is their a free market way to correct this issue?
 
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Fantine

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One problem is that the cost of higher education has risen much faster than inflation. The biggest reason seems to be that states are subsidizing tuitions less and less in state schools.
My daughter got a culinary associates degree at a state university that cost about $100 a credit.
 
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JohnDB

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Massage School?
Adult Entertainment Academy?
Blackjack and Poker Dealer university?
Clown College of entertainment?
(These actually exist)

Yeah...there needs to be some limits on what kinds of schools and degrees are funded with loans and dollar limits put upon them.

60%- 90% dropout rates after the first year of education is usually the sign of a fairly standard academic school. (EVERYONE says that they will start again)

Then the cost of education is astronomically high lately. It has definitely outpaced inflation but has seemed to keep pace with Hope Scholarships from lottery ticket sales.

Now I can see the need for loans for doctors, nurses, teachers and a host of other skills. These are needed skills that we need to fund.
(What are they teaching at journalism/broadcasting school?)

A French Renaissance Art Major might find work but they might not. Same thing with Midevil literature major.
Not that art or literature studies aren't important in a society...but elephant dung on the virgin mary or an american flag half stuffed into a toilet isn't art...it's an attack on religion or politics.

Teachers are not paid a lot for the hours they put into teaching in the first place. (Homework grading, test grading, and lesson plans make for very long days for little money) But every University lately seems to have plenty of money for building expansion and facilities lately.
Liberty University's list of assets are astounding. (The president may have been without personal morals but their financials have swelled enormously)

School Loans outstanding are currently at 1.4 Trillion Dollars?
Currently some of the most productive members of American society are enslaved to the debts.

But I also wanted to include the point that many of these loans were made with the agreement of forgiveness for working for non-profit organizations like public schools and universities for ten years while making payments and the servicing companies have not kept their part of the deal. Finding every technicality possible (filling for forgiveness one month too late)
 
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GreekOrthodox

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Now I can see the need for loans for doctors, nurses, teachers and a host of other skills. These are needed skills that we need to fund.
(What are they teaching at journalism/broadcasting school?)

A French Renaissance Art Major might find work but they might not. Same thing with Midevil literature major.

You'd be very surprised for journalism. I have one classmate who broke the story on meth and was a finalist for a Pulitzer. Another person from my school, graduated from Yale with a American Studies major, has written a number of best selling biographies including Gregg Allman, Prince and the history of Leonard Cohen's Hallelujah.

Personally, I have a BS in Chemical Engineering and a BA in Religion and work in hospital clinical communications. You never know where you will end up for work. One classmate has an MD from Johns Hopkins but opened up an award winning children's bookstore instead.
 
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JohnDB

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You'd be very surprised for journalism. I have one classmate who broke the story on meth and was a finalist for a Pulitzer. Another person from my school, graduated from Yale with a American Studies major, has written a number of best selling biographies including Gregg Allman, Prince and the history of Leonard Cohen's Hallelujah.

Personally, I have a BS in Chemical Engineering and a BA in Religion and work in hospital clinical communications. You never know where you will end up for work. One classmate has an MD from Johns Hopkins but opened up an award winning children's bookstore instead.
Oh I completely understand...but do you have outstanding student loan debt that you can't afford to pay?
The Journalism comment was being facetious about all the shaded journalism going on. Not that it isn't a needed skill.

Sure, people end up in careers that have nothing to do with their degrees or are somewhat different than the focus of their degrees. An English Education/writing degree can be useful in many ways outside of the public school system. Just like a Chemistry degree is useful for pharmaceutical or pesticide sales or purchasing agent.
An MD running a bookstore? OK...but is he at least paying back the student loans?
(Used to say that those who failed at Veterinary medicine were your local MD)
 
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iluvatar5150

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Indeed. There seems to be a huge disconnect between our for profit school system and the results they produce. So, what do you think we should do about it? Should we craft a government solution or is their a free market way to correct this issue?

Markets require information to function efficiently and a big problem with the education market is the lack of information held by the potential student and the difficulty in acquiring that information.

Very few people have a good grasp of what the job prospects are like across fields, what they're like across geographic areas, what different jobs pay, or how certain universities' programs are perceived in industry. And university marketing material does nothing to clarify things.
 
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98cwitr

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$2500 for a professional welding cert at my local tech school. Come out making $45k-$50k/yr. Now that's a pretty good ROI. You can do really well at a non-ivy league school and get a great job. I don't understand why folks think they all need to go to Harvard or Yale to be successful. You don't.
 
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iluvatar5150

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$2500 for a professional welding cert at my local tech school. Come out making $45k-$50k/yr. Now that's a pretty good ROI. You can do really well at a non-ivy league school and get a great job. I don't understand why folks think they all need to go to Harvard or Yale to be successful. You don't.

Harvard and Yale aren't the problem. I'm less familiar with Yale, but at least at Harvard, it's not the most expensive option out there; it has a fairly generous student aid plan such that few people pay sticker price (and those who do can afford it); and the cache of the name helps pay for itself. They're also pretty selective, so they aren't pumping out tons and tons of graduates every year, flooding the job market.

The problem is the mid and lower tier universities (especially, though not exclusively private universities) with more/bigger classes, less-selective and less-prestigious programs, and less-generous financial aid, but with sticker prices that hang with those of elite institutions. Universities aren't like sports cars where prices grow exponentially the closer you get to the very top. If anything, they're closer to a logarithmic curve where most of the field charges high rates with little regard to their quality.
 
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Belk

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Markets require information to function efficiently and a big problem with the education market is the lack of information held by the potential student and the difficulty in acquiring that information.

Very few people have a good grasp of what the job prospects are like across fields, what they're like across geographic areas, what different jobs pay, or how certain universities' programs are perceived in industry. And university marketing material does nothing to clarify things.

True. Not to mention the whole "Pursue your dreams!" movement that encourages people to make choices that are more feel good then realistic. I might dream of playing video games for a living but the reality is that most people don't get to make a career of that.
 
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Belk

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$2500 for a professional welding cert at my local tech school. Come out making $45k-$50k/yr. Now that's a pretty good ROI. You can do really well at a non-ivy league school and get a great job. I don't understand why folks think they all need to go to Harvard or Yale to be successful. You don't.

High school buddy of mine did that as a diesel mechanic. He was making good money right out of high school and was able to leverage that into a side interest in real estate.
 
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iluvatar5150

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True. Not to mention the whole "Pursue your dreams!" movement that encourages people to make choices that are more feel good then realistic. I might dream of playing video games for a living but the reality is that most people don't get to make a career of that.

I know you're joking, but I know a number of people who (sort of) do play video games for a living and even for those who do, it's rare that that's the end goal. Ignoring the competitive leagues, those folks are typically working in some sort of QA capacity, which is the low-paid meat-grinder department, and they're usually using it as a foot in the door to migrate into a different department (typically production or design). IME, QA folks are typically a lot smarter and harder working than their pay and status would indicate.
 
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hislegacy

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600,000 for Choiprachter degree... when the job only pays on average 60k per year.
Or $75,000 for an acting degree so you can get bit parts in commercials or plays. (Paying maybe $2,000/yr)

Median income for a chiropractor is 150,000. Just an FYI
 
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JohnDB

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$2500 for a professional welding cert at my local tech school. Come out making $45k-$50k/yr. Now that's a pretty good ROI. You can do really well at a non-ivy league school and get a great job. I don't understand why folks think they all need to go to Harvard or Yale to be successful. You don't.
Tech schools do pay off well... until the day comes that your body won't do the physical portion of the job. Steel is heavy. And in some areas of the country welders do well to get $11/hr.
Welding fumes aren't the greatest thing to breathe either.
So there aren't a lot of jobs for foreman or something else in that industry that doesn't require a lot of manual labor...and backup plans are needed.
 
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There was a time when loans weren't readily dispensed. I think students should go to schools they can afford. When my daughter applied to NYU's program in the Middle East (without my knowledge), I told her I wasn't going to afford it! The program was $200K for a bachelor's degree.

Parents need to put their foot down. This isn't free money. They need to quit treating it that way.

Yours in His Service,

~bella
 
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98cwitr

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Tech schools do pay off well... until the day comes that your body won't do the physical portion of the job. Steel is heavy. And in some areas of the country welders do well to get $11/hr.
Welding fumes aren't the greatest thing to breathe either.
So there aren't a lot of jobs for foreman or something else in that industry that doesn't require a lot of manual labor...and backup plans are needed.

Sure, but hopefully by that point you're ready to retire, better be smart and start dumping into a 401k. Sitting all day working in an office job isn't great for the body either, but here we are :D

If I were a welder, I'd wear a respirator and once I got enough money and experience saved up, I'd open my own welding shop and be my own boss.
 
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hislegacy

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Tech schools do pay off well... until the day comes that your body won't do the physical portion of the job. Steel is heavy. And in some areas of the country welders do well to get $11/hr.
Welding fumes aren't the greatest thing to breathe either.
So there aren't a lot of jobs for foreman or something else in that industry that doesn't require a lot of manual labor...and backup plans are needed.

Q: What Is the Average Welder Salary by State in 2020?
 
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Sure, but hopefully by that point you're ready to retire, better be smart and start dumping into a 401k. Sitting all day working in an office job isn't great for the body either, but here we are :D

If I were a welder, I'd wear a respirator and once I got enough money and experience saved up, I'd open my own welding shop and be my own boss.
Don't even have to do that. get into some high end welding jobs like the guys who work under my father, and you can be pulling in $40/hour easy with as much overtime as you want.
 
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Oh I completely understand...but do you have outstanding student loan debt that you can't afford to pay?
The Journalism comment was being facetious about all the shaded journalism going on. Not that it isn't a needed skill.

Sure, people end up in careers that have nothing to do with their degrees or are somewhat different than the focus of their degrees. An English Education/writing degree can be useful in many ways outside of the public school system. Just like a Chemistry degree is useful for pharmaceutical or pesticide sales or purchasing agent.
An MD running a bookstore? OK...but is he at least paying back the student loans?
(Used to say that those who failed at Veterinary medicine were your local MD)

Morning John,
I'm 52 so my bachelors loans were paid off a long time ago. I will say that my private college did have the highest increases of tuition in the late 1980s. When I started, it was $10K, 5 years later (with the double major), it was $22K. I was working on an M.Div and had to drop out just as the 2007 recession hit. I had to go on full blown welfare for three years. I'm still working on the loan for that.

As for my buddy... well, probably a quarter of the families (not mine) at my HS were in the top 5%. Money was typically not a huge problem for them. If I'd played my dating cards right back then, I could have married into a billionaire family.
 
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