For the first time ever, the amount of student loans taken out last year exceeded $100 billion.
For the first time ever, Americans now owe more on student loans than on credit cards! This having been reported by the Federal Reserve Bank of New York.
For the first time ever, total student loans outstanding will exceed $1 trillion this year.
Reported on ZeroHedge.com, “It’s going to create a generation of wage slavery”. “So… debtors know it’s a bubble, lenders know it’s a bubble, everyone knows it’s a bubble, yet it is growing faster now than ever before.”
What explains this insatiable demand for this kind of debt? Well, it’s cheap, it’s easily accessible (the collateral is education), and a student can take out a loan, yet use part or all of the balance for tangential purchases (that iPhone 4S sure would make me cool). But this, like every other debt, comes at a price. A generation of wage slavery.
Young people are entering adulthood more in debt than ever before. They have an expectation that the tens of thousands of dollars in student loans for a college education will turn to gold as they enter the workforce. The problem is… ‘what workforce?’ Good luck with your expectations of immediately landing that Sr. Manager or Director position. After all, your educational pedigree is stellar, right? Particularly in today’s economic environment, this thinking is delusional.
It may be a false notion to believe that every young adult must obtain a higher college education degree in order to fulfill the young adult’s capacity to perform to their optimum ability in today’s modern society and workplace. Not everyone’s DNA is meant for college either, although most parents today assume that their ‘junior’ must attend.
It is unfortunately an employers market today, and a college degree is often a required prerequisite. However, there comes a point where you wonder if spending the big bucks on a burdening loan at such a young age is the best thing for the long term outlook. I suppose that one could consider a less expensive school while still earning a degree, or perhaps finding a way to enter the workforce early while building on-the-job experience before others do (which is another prerequisite for most jobs in a particular field… e.g. 3 to 5 years experience in ‘xyz’).
There are no simple answers to the dilemma of determining the most frugal but effective way to assure one’s-self a decent job while entering the workforce. However I do question the automatic assumption that every kid needs to go to the fancy big-name school and burden themselves with enormous debt while only in their late teens or early 20′s. Ouch.
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