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Misuse of Student Loans

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I might be the worst person to talk about student loans considering I have never had a student loan, however it is something I have been hearing a lot of lately so I wanted to give my two cents.

At the University that I attend for my MBA program, tuition will be greatly increased.  Tuition, per credit, has been increased to $339.50 for College of Business students.  For all other graduate students (excluding Engineering), the cost per credit is only $239.50.

With that being said, many of my peers are even more reliant on Student Loans to pay for their education.  I am fortunate enough to have my parents pay for my education, so I do not have to pay for my grad school.

Student loans can be wonderful for those who need them.  Low interest rates and deferred payments make them an ideal candidate for any student.  What really bothers me is the lack of research that goes into taking out a student loan.  Just because your payments are deferred does not mean you’re not still accruing interest.

Another thing that irks me is when your classmate/friend rolls up in a brand new 2011 Ford Escape.  How did they pay for this?  “I took out a student loan.”  Good for you.  A $12,000 used vehicle would have worked just as well as the $20,000 brand spankin’ new car you just purchased, but what expert am I?

And taking that a step further, what PEEVES me is when someone goes on a shopping spree.  Why?  “I had money left over on my student loan.”  Do people not realize they’re paying the interest for these loans?  Isn’t paying these loans off more ideal than a pair of $60 pumps that look just like the rest?

Did you know that:

  • The average rate of tuition increases at TWICE the rate of inflation.
  • 2/3 of college students have loan debt after graduation
  • Average student loan debt is $42,000 for graduate students
  • You can defer payments up to 3 years after graduation

Resources Used

Federal Student Aid

Student Debt in America

Student Loan Debt

Photo Credit

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5 responses »

  1. I would let this irk me too, until I realize that people who treat loans like this will never get the last laugh. Not that I ever want to see someone in debt that they can’t get out of (and I have student loans myself), but sometimes irresponsible people have to learn the hard way.

    I just hope they learn the first time they get in trouble, because it seems like a lot of those people who had to deal with foreclosures and such (that got our country’s economy in trouble in the first place) are still running up credit card bills.

    Reply
    • Right?! It’s like they’ll never learn! I know when I put something on my credit card I am incredibly paranoid to pay it off immediately. Some people look at it as free money though. Urgh.

      Reply
  2. I also have never had student loans, though not because my parents paid for my college. I paid it for myself with a lot of help from financial aid and scholarships. I could never understand how people could view loans and credit cards as free money.

    Reply
    • Wow that’s amazing! Scholarships are so crucial to surviving college without student loans – it’s people like you who are completely on the right track with utilizing scholarships.

      Reply
  3. Yesterday i spent 300 bucks for platinium roulette system ,
    i hope that i will earn my first $$ online

    Reply

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