Student Loans

We now have $1.2 trillion in student loan debt out there. On average, our students are graduating with $35,000 of debt. That’s a lot for someone starting out in the workforce. 71% of our students graduate with some amount of debt—about three quarters of us. So, that begs the question: Is it worth it?

We know that college grads have higher lifetime earnings, and we certainly saw lower unemployment, especially 2008 through 2010—much lower. But that’s on average. It really depends on the degree. You need to make sure you research the degree and research the incomes that you can get with that degree and the reputation of the college. Make sure your college that you’re graduating from is well thought of by employers.

What about loan forgiveness? We do have some plans out there, but it depends on the type of loan and the age of the loan. For teachers, if you teach five years in a low income setting, up to $5,000 can be forgiven. That’s a nice plus there. If you’re a Special Education teacher, it’s over $17,000 in loan forgiveness. Then, if you work in the public sector or a nonprofit, if you pay for 10 years in a row, the remainder may be forgiven.

We also now have income based plans and pay as you earn plans so that there is a cap on the monthly payments so that you’re not overburdened based on your income. There’s a cap on the payback period of somewhere between 20 and 25 years.

In the meantime, those loans kick in six months after you graduate. If you sign up for automatic payments coming out of your bank account, you’re going to save yourself 0.25% on that interest, which is a really good thing to do.

If you need more information—you want to research your type of loan and see what types of plans are out there—go to for more information. Also, remember, student loans are usually not forgiven in bankruptcy, so you’re going to have to live with them.

#studentloans #debt #financialadvisor #feeonlyfinancialadvisor #investmentadvisor #financialplan

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