Opinion: America has a $1.7 trillion student-debt crisis: ‘Where is the call for wise student borrowing?’
By TIM RANZETTA
‘Isn’t anyone making the connection between this national problem and the financial-illiteracy crisis?’
A lack of financial knowledge and skills leads to wildly different approaches. One student may enroll in an expensive private college in their town, and decide to live on campus, despite having to take on debt that will be very difficult to pay off, given their choice of major. Another student may set their sights on the same school, but plan to save thousands of dollars by going to the local community college for two years before transferring.
The average student-loan debt is $37,338, but that rises to $54,921 per borrower for private student-loan debt. The average starting salary for students graduating last year was $55,000.
Bottom line: the student-debt crisis exists in large part because young people borrow thousands of dollars for college, and oftentimes end up with jobs that make it difficult for them to pay off their loans in a timely manner. A rough guideline is that your total loans should not exceed the annual salary of your first job.