IS THE STUDENT LOAN BUBBLE ABOUT TO POP?

[Geee]

Human Events:

Reuters brings grim tidings from the world of America’s debt-encrusted college students:

 

 

Banks wrote off $3 billion of student loan debt in the first two months of 2013, up more than 36 percent from the year-ago period, as many graduates remain jobless, underemployed or cash-strapped in a slow U.S. economic recovery, an Equifax study showed.

The credit reporting agency also said Monday that student lending has grown from last year because more people are going back to school and the cost of higher education has risen.

“Continued weakness in labor markets is limiting work options once people graduate or quit their programs, leading to a steady rise in delinquencies and loan write-offs,” Equifax Chief Economist Amy Crews Cutts said in a statement.

[clearvision]

It is going to get worse.

[Valin]

Human Events:

Reuters brings grim tidings from the world of America’s debt-encrusted college students:

 

Via Meadia: College Tuition: The New Gamble

3/27/13

 

If you have young children, or have given some thought to starting a family, the looming specter of paying for your son or daughter’s college tuition 15 or 18 years down the line no doubt keeps you wide awake some nights. You may have considered putting money into a “529 plan”, an investment vehicle designed to give certain tax advantages for saving for higher education expenses. The NYT has a short piece about one version of these investments, the Private College 529 Plan. The plan offers parents a chance to prepay tuition for their children at a selection of private colleges and universities, at today’s tuition rates:

 

(Snip)

 

Beyond the risk of a child rejecting his or her parents’ carefully mapped out future (we’re sure this rarely happens), there are other ways this plan is risky, it seems to us. If you buy into the plan, you’re making predictions about the future of education which we would argue are far from a sure thing. Parents are betting that tuition costs will rise faster than the returns on their savings if they had invested them in any number of other options.

 

Here at Via Meadia, we’ve tried to show that higher education is undergoing a period of rapid change. What colleges will look like 15-20 years from now is anyone’s guess. But with the rise of MOOCs, the decline of state higher ed funding, and increasingly unsustainable student debt burdens, one thing is certain: change is coming.

 

 

More Here

[pollyannaish]

I'll tell you what...having a college student right now is one of the most terrifying experiences ever. Once this bubble pops, it may be easier, but right now its terrifying because there is a high likelihood this generation going through right now will end up holding the bag.

 

One of the hardest things for me, is realizing that the "follow your dreams" meme that we have been sold with giant price tags for the last thirty years or so is an illusion. It's just not that easy and can mean struggle for the rest of ones life.

 

What I do know is that I can not map out my children's future. We can talk openly, but at some point they have to make their own decisions. For better and for worse.

 

Sigh. The upside is it is a stark reminder that our future is in God's hands and we must rely only on him.