anecdotally, in my circle, it's only ok to talk about student loans / precise figures, if you're "doing student debt well" aka, the total figure you borrowed was lower than like- 50k for undergrad, and you're paying it down and making progress every year, and you don't have issues making your car payment / rent / groceries. A friend with student loans and no degree who is living with her mom bc she cannot afford anything else- she doesn't talk about this stuff. You have to put the pieces together.
I think there's this shame attached to floundering. I graduated in 2019 with 69k in debt and I got a 28k a year job- I did very little all year but put money towards my loans, stay home, and cry. (And then covid hit .... yay.) The psychological weight of it was horrible. But I couldn't talk about this stuff bc it made me feel like a failure of an adult. How could I not have foreseen this, how could I not be handling it better, making more money? I paid 10k to the loans that year and it was one of the worst years of my life. The Covid years were better, psychologically. I wish I'd done it differently. You would think by now I'd feel that it was money/time well spent. I don't bc I still have loans lmfao.
I feel way more comfortable talking about my student loans now bc I am not trapped between them and living any sort of a real adult life that everyone else seems to somehow be experiencing. That's not bc I bootstrapped my way out of them- I got married, and our combined income is finally enough to afford my loan payments. That's not a success story, that's Cinderella. Or the golden ticket in willy wonka. Don't get me wrong money is still tight... but I'm not nervously keeping absolutely everything that comes into my apt anymore. If I was single, I think I'd have a hoarding problem that would have been kicked off by my low income. These things all tangle up with each other.
Let's look at hard figures on student debt so we can see who becomes ensnared in the predatory student loan industry in the US. I was a NY Times journalist but did not go to an "elite" college; I am a proud graduate of Buffalo State. But I attended during a gentler time when low-income kids were seen as a great investment by our government. Times have changed.
-- The following figures are taken from The Indicators of Higher Education Equity in the United States: 2022 Historical Trend Report. It's by the Pell Institute for the Study of Opportunity in Higher Education and the University of Pennsylvania Alliance for Higher Education and Democracy (PennAHEAD). I have included page numbers here:
-- Student debt is soaring: in 2021, 43 million people had student debt amounting to $1.75 trillion, up from $330 billion in 2003 (4c page 164)
--In 2016, of students whose families are in the lowest income quartile ($32,542), the average net price of a college education was equivalent to 94 percent of family income. (4b(ii) Page 163)
-- Nearly half of Black graduates become mired in debt. In 2012, four years after graduating from college, 48 percent of Blacks owed more money than they borrowed. In contrast, 17 percent of Whites owed more than they borrowed four years after graduating. (4e) Page 178)
--White families had a median wealth of $108,320 in 1983 and $162,176 in 2019, in constant 2020 dollars. Black median wealth was $7,188 in 1983 and just $9,111 in 2019, a rise of just 27 percent. Hispanic median wealth was $4,151 in 1983 and $14,173 in 2019, an increase of 241 percent. (Figure. 8b(ii) Page 38)
-- Finally: Of students from low-income families who received Pell grants, the average amount borrowed ($43,983) to attend college far exceeded the amount borrowed ($25,375) by students from higher income families. Blacks who qualified for Pell Grants borrowed an average of $58,644; Whites., an average of $31,578. (4e(ii), Page 175).
I rest my case. Student debt is making worse a serious divide between haves and have nots, and our government has become the company store. It's disgusting.
I am so here for all conversations about student loan debt - one of my frustrations is that way too many of the popular media stories about student loan debt are about the most extreme examples. The barista with a degree in film studies from NYU and $150,000 in debt -- this is almost a trope now and isn't representative of actual debt loads for most students but people love these examples because they are easy to judge, I suspect.
When I think about student loan debt (which I do a lot because I'm also in higher ed), I think about two things the most:
1. The average amount of loan debt for community college graduates is under $15,000 and many students graduate without any debt at all and often go into professions that pay a livable wage. But there is still SO MUCH snobbery about community colleges that many parents (especially middle and upper middle class white parents) don't consider them a viable option. Starting at a CC and transferring could save so many students tens of thousands of dollars in loan debt but that isn't the "college experience" that parents picture. It is fascinating that so many parents report stress and worry about how much debt they and their kids will incur for college but ignore the easiest cost savings option out there. People are not rational financial actors.
2. We've got to talk about the student loan rates in the for-profit sector. The combination of the worst outcomes (in terms of graduation) and the highest loan levels is pretty awful and I think we are well overdue for a national conversation about whether or not federal financial aid dollars should continue to support this sector.
I endorse your endorsement of community colleges. They are an undervalued resource, so accessible and far more affordable. Students have more freedom to explore career options and the instructors are way more hands on in my experience. The snobbery is real and it needs to end!
Thank you! I'm battling a related issue in my daughter's middle school parent community around which "good" high schools lead to "good" colleges. The pressure middle and upper class parents are putting on their kids is spilling over to my kid. I'm doing my best to encourage my daughter to chart at an educational path based on her educational, social, emotional, and nascent career goals, but the outside pressures to go for the name brand path feel insurmountable.
I attended Rice University in the 1980s and my freshman year, the tuition was $500 cheaper than the private high school ("Rushmore") I had attended the year before. Rice used to be free but that part of the founder's will was broken along with the provision that only white students could attend back in the 1960s.
What my alumni peers and I discuss about the student loans of our younger friends and our kids, apart from the sticker shock, is how even with our student loans, our economic situation in our 20s and 30s was so much less precarious precisely because we didn't have the burden of student loans the way graduates do now. We're aware collectively that we were extremely lucky because we had low tuition for the education we got, even in the 80s and early 90s, and many of us completely avoided loans between low tuition, grants, and the Bank of Family. We see the difference and support measures to make things better like student loan forgiveness.
I wish there were more of us in my age group and fewer "I got mine" folks happy to pull up the ladder after us.
Fellow Rice alum here! When I attended in the early 2000s, tuition was still $10k less per year than any comparable private university although a far cry from free. I was deciding between Rice and another private school that I was enamored of (New England quad with scarves and snowball fights that I probably would have hated come January but was so perfectly collegiate in my imaginings). The financial difference was an additional $10k in loans per year, so a $40k increase in debt load upon graduation. My parents didn't let me go to that New England school which I was so mad about but (a) I enjoyed my time at Rice and (b) I cannot imagine how much different my 20s would have been with that extra debt loan! I say this not to try to rub in that I made a "smarter" choice to limit my debt or, to underscore the point of some of this research, to say that I can't understand kids today and their debt complaints because I had an easier time of things, but to empathize with all those 18 year olds making major financial decisions. I had NO IDEA what that kind of debt would have meant to my daily life and opportunities (and honestly still don't, since I didn't experience that counterfactual), and I think it's bonkers we put kids in the position to make those kinds of choices. Money was not real to me at that point, and not because I was extremely wealthy but because it was simply abstract.
Elizabeth, you’ve hit on such a vital part of the conversation. Students get the hard sell on a college education from all sides. They believe their entire lives will be a disaster without the ‘right’ degree from the ‘right’ school with no discussion of the practical realities including whether they’re knowledgeable or self-aware enough to know what they want for themselves, expectations be damned. There also needs to be a frank discussion about the ROI of the path they are being steered towards. Students need a fuller exploration of many options, or the choice to not opt in right now, if ever. If we are pricing a colllege education like an expensive commodity, the ‘benefits’ for the price tag need a hard analysis.
+1 on the ROI discussion. I think there’s some nuance here because the awareness/ability to calculate future value, opportunity costs, and even wages often comes with higher education. So this disadvantages first- or newer-generation college attendees. I certainly benefited from my college-educated parents’ perspective and guidance in this regard.
I was a scholarship student at an Ivy Minus—maybe...one tier down from Ivy Plus. Very few of my friends and peers graduated with significant debt. Post-college, I took a less “prestigious” path than many of my classmates (social services vs. journalism/public policy/consulting/medicine). It was very sobering to realize that among my 6 new housemates, I was the only one without major student debt. It really shined a light on my ignorance and missing perspective in my collegiate social network. I’m glad to see this gap is being analyzed and amplified.
I had been hoping for ages that Letters From an American would talk about student loans as the debt relief program was coming to a head. I was so disappointed - and have continued to be - by the overall lack of interest by her as well as other non-traditional news sources. Student debt has and will continue to shape this country, especially as those who can access/afford higher ed becomes a narrower and narrower scope of people. Which I fear is exactly why news outlets, traditional and otherwise, aren't talking about it. Ignorance of the public has resulted in so much chaos for our nation, especially over the last 6 years, and keeping people ignorant about the student loan situation or focusing solely on earnings potential for graduates rather than all those things don't graduate, who go to school and do graduate specially for low-paying essential jobs like education and social work, racial inequality of debt load, etc. I had no idea work like Dr. Baker's existed, and that in itself is a problem. Once again, AHP, thank you for shedding light on a super niche, highly relevant, deeply contextual subject! I can't wait to share this article with my public policy class!
Fascinating angle, thank you! I feel terrible every time I read stats on undergrad degree attainment across the US and then must face the lack of educational diversity of my friends and family. Yes, my Black family's educational attainment is laudable (from not even high school diplomas to undergrad degrees for all in two generations), but at what cost?
I attended a state university, and graduated with about $20k in debt. I paid down some of it, but after my second child was born in 2014 and it made more sense for me to not work, I made the (dumb?) decision to just default on my loan. Honestly, it never really affected me... my partner and I already had a house, and the credit impact is not as scary as they make it out to be. My wages or tax refunds were never garnished, either. I’m now waiting to see the approval from Nelnet on my income based repayment application. I was optimistic for Biden’s forgiveness plan, and sad when it didn’t work out - I’ve only loosely ever used my degree, and it would be nice to not have this hanging over my head for the rest of my life.
I saw the "table setting" questions and found them very important: "What does it mean for college to truly be affordable? Who is provided access to a quality education? What is success in higher education?" When my grandmother went to a state college for a 2-year teaching certificate in the 1920s, she was one of the elite 25% of her generation to graduate from HIGH SCHOOL. So my questions go much deeper than "what is success in HIGHER education" (now sought by about 70% of high school graduates, who are about 90% of all young people).
I wonder, first, why we have come to think "higher" (post-secondary) education is a mandate, and the ways it's been reconstructed as an essential in my lifetime. Today, MA level college grads often need to follow their degrees with unpaid internships to get in line for the possibility of a paid job. Expensive post-secondary career training (eg: Culinary Institute of America) still places you post-graduation in the kind of prep kitchen job you could have done while in high school.
Then, I wonder why we think that "quality education" is the academic kind. I'm a college grad, as are three of my sibs. The sibling who didn't get a college degree (his reading leans to the "Wordless Workshop" in Popular Mechanics magazine) was still able to "dub up" a trailer to haul 2 tons of farm produce to the processing plant. And to design and build his own house. Needless to say, I can't do those things!
Finally, part of the systems task that higher education accomplishes is to sort people by social class. In my time, if you went to Harvard and took an unpaid internship at the Boston Globe, you'd get an offer at the Globe. If you went to Northeastern and had a paid internship at the Globe, you'd get an offer at a small-city daily. Likewise if you went to UMass and freelanced (as I did). So there's some irony in attempting to make college more accessible to more people. Because the jobs and lifestyle that once required a college degree now require advanced degrees and unpaid internships that you need generational wealth to afford. The systems of privilege will just raise the bar.
This is a slight sidewinder from the questions about student loan debt, but people take on that burden with the expectation that it will result in positive life benefits. Which we're seeing it doesn't. Which (in my sometimes cynical mind) it was never designed to do.
anecdotally, in my circle, it's only ok to talk about student loans / precise figures, if you're "doing student debt well" aka, the total figure you borrowed was lower than like- 50k for undergrad, and you're paying it down and making progress every year, and you don't have issues making your car payment / rent / groceries. A friend with student loans and no degree who is living with her mom bc she cannot afford anything else- she doesn't talk about this stuff. You have to put the pieces together.
I think there's this shame attached to floundering. I graduated in 2019 with 69k in debt and I got a 28k a year job- I did very little all year but put money towards my loans, stay home, and cry. (And then covid hit .... yay.) The psychological weight of it was horrible. But I couldn't talk about this stuff bc it made me feel like a failure of an adult. How could I not have foreseen this, how could I not be handling it better, making more money? I paid 10k to the loans that year and it was one of the worst years of my life. The Covid years were better, psychologically. I wish I'd done it differently. You would think by now I'd feel that it was money/time well spent. I don't bc I still have loans lmfao.
I feel way more comfortable talking about my student loans now bc I am not trapped between them and living any sort of a real adult life that everyone else seems to somehow be experiencing. That's not bc I bootstrapped my way out of them- I got married, and our combined income is finally enough to afford my loan payments. That's not a success story, that's Cinderella. Or the golden ticket in willy wonka. Don't get me wrong money is still tight... but I'm not nervously keeping absolutely everything that comes into my apt anymore. If I was single, I think I'd have a hoarding problem that would have been kicked off by my low income. These things all tangle up with each other.
Let's look at hard figures on student debt so we can see who becomes ensnared in the predatory student loan industry in the US. I was a NY Times journalist but did not go to an "elite" college; I am a proud graduate of Buffalo State. But I attended during a gentler time when low-income kids were seen as a great investment by our government. Times have changed.
-- The following figures are taken from The Indicators of Higher Education Equity in the United States: 2022 Historical Trend Report. It's by the Pell Institute for the Study of Opportunity in Higher Education and the University of Pennsylvania Alliance for Higher Education and Democracy (PennAHEAD). I have included page numbers here:
-- Student debt is soaring: in 2021, 43 million people had student debt amounting to $1.75 trillion, up from $330 billion in 2003 (4c page 164)
--In 2016, of students whose families are in the lowest income quartile ($32,542), the average net price of a college education was equivalent to 94 percent of family income. (4b(ii) Page 163)
-- Nearly half of Black graduates become mired in debt. In 2012, four years after graduating from college, 48 percent of Blacks owed more money than they borrowed. In contrast, 17 percent of Whites owed more than they borrowed four years after graduating. (4e) Page 178)
--White families had a median wealth of $108,320 in 1983 and $162,176 in 2019, in constant 2020 dollars. Black median wealth was $7,188 in 1983 and just $9,111 in 2019, a rise of just 27 percent. Hispanic median wealth was $4,151 in 1983 and $14,173 in 2019, an increase of 241 percent. (Figure. 8b(ii) Page 38)
-- Finally: Of students from low-income families who received Pell grants, the average amount borrowed ($43,983) to attend college far exceeded the amount borrowed ($25,375) by students from higher income families. Blacks who qualified for Pell Grants borrowed an average of $58,644; Whites., an average of $31,578. (4e(ii), Page 175).
I rest my case. Student debt is making worse a serious divide between haves and have nots, and our government has become the company store. It's disgusting.
I am so here for all conversations about student loan debt - one of my frustrations is that way too many of the popular media stories about student loan debt are about the most extreme examples. The barista with a degree in film studies from NYU and $150,000 in debt -- this is almost a trope now and isn't representative of actual debt loads for most students but people love these examples because they are easy to judge, I suspect.
When I think about student loan debt (which I do a lot because I'm also in higher ed), I think about two things the most:
1. The average amount of loan debt for community college graduates is under $15,000 and many students graduate without any debt at all and often go into professions that pay a livable wage. But there is still SO MUCH snobbery about community colleges that many parents (especially middle and upper middle class white parents) don't consider them a viable option. Starting at a CC and transferring could save so many students tens of thousands of dollars in loan debt but that isn't the "college experience" that parents picture. It is fascinating that so many parents report stress and worry about how much debt they and their kids will incur for college but ignore the easiest cost savings option out there. People are not rational financial actors.
2. We've got to talk about the student loan rates in the for-profit sector. The combination of the worst outcomes (in terms of graduation) and the highest loan levels is pretty awful and I think we are well overdue for a national conversation about whether or not federal financial aid dollars should continue to support this sector.
I endorse your endorsement of community colleges. They are an undervalued resource, so accessible and far more affordable. Students have more freedom to explore career options and the instructors are way more hands on in my experience. The snobbery is real and it needs to end!
Thank you! I'm battling a related issue in my daughter's middle school parent community around which "good" high schools lead to "good" colleges. The pressure middle and upper class parents are putting on their kids is spilling over to my kid. I'm doing my best to encourage my daughter to chart at an educational path based on her educational, social, emotional, and nascent career goals, but the outside pressures to go for the name brand path feel insurmountable.
I attended Rice University in the 1980s and my freshman year, the tuition was $500 cheaper than the private high school ("Rushmore") I had attended the year before. Rice used to be free but that part of the founder's will was broken along with the provision that only white students could attend back in the 1960s.
What my alumni peers and I discuss about the student loans of our younger friends and our kids, apart from the sticker shock, is how even with our student loans, our economic situation in our 20s and 30s was so much less precarious precisely because we didn't have the burden of student loans the way graduates do now. We're aware collectively that we were extremely lucky because we had low tuition for the education we got, even in the 80s and early 90s, and many of us completely avoided loans between low tuition, grants, and the Bank of Family. We see the difference and support measures to make things better like student loan forgiveness.
I wish there were more of us in my age group and fewer "I got mine" folks happy to pull up the ladder after us.
Fellow Rice alum here! When I attended in the early 2000s, tuition was still $10k less per year than any comparable private university although a far cry from free. I was deciding between Rice and another private school that I was enamored of (New England quad with scarves and snowball fights that I probably would have hated come January but was so perfectly collegiate in my imaginings). The financial difference was an additional $10k in loans per year, so a $40k increase in debt load upon graduation. My parents didn't let me go to that New England school which I was so mad about but (a) I enjoyed my time at Rice and (b) I cannot imagine how much different my 20s would have been with that extra debt loan! I say this not to try to rub in that I made a "smarter" choice to limit my debt or, to underscore the point of some of this research, to say that I can't understand kids today and their debt complaints because I had an easier time of things, but to empathize with all those 18 year olds making major financial decisions. I had NO IDEA what that kind of debt would have meant to my daily life and opportunities (and honestly still don't, since I didn't experience that counterfactual), and I think it's bonkers we put kids in the position to make those kinds of choices. Money was not real to me at that point, and not because I was extremely wealthy but because it was simply abstract.
Elizabeth, you’ve hit on such a vital part of the conversation. Students get the hard sell on a college education from all sides. They believe their entire lives will be a disaster without the ‘right’ degree from the ‘right’ school with no discussion of the practical realities including whether they’re knowledgeable or self-aware enough to know what they want for themselves, expectations be damned. There also needs to be a frank discussion about the ROI of the path they are being steered towards. Students need a fuller exploration of many options, or the choice to not opt in right now, if ever. If we are pricing a colllege education like an expensive commodity, the ‘benefits’ for the price tag need a hard analysis.
+1 on the ROI discussion. I think there’s some nuance here because the awareness/ability to calculate future value, opportunity costs, and even wages often comes with higher education. So this disadvantages first- or newer-generation college attendees. I certainly benefited from my college-educated parents’ perspective and guidance in this regard.
I’m another Rice alumni (‘78) and your post really resonates with me. I had zero debt when I graduated; that is not the case today for my children.
I was a scholarship student at an Ivy Minus—maybe...one tier down from Ivy Plus. Very few of my friends and peers graduated with significant debt. Post-college, I took a less “prestigious” path than many of my classmates (social services vs. journalism/public policy/consulting/medicine). It was very sobering to realize that among my 6 new housemates, I was the only one without major student debt. It really shined a light on my ignorance and missing perspective in my collegiate social network. I’m glad to see this gap is being analyzed and amplified.
I had been hoping for ages that Letters From an American would talk about student loans as the debt relief program was coming to a head. I was so disappointed - and have continued to be - by the overall lack of interest by her as well as other non-traditional news sources. Student debt has and will continue to shape this country, especially as those who can access/afford higher ed becomes a narrower and narrower scope of people. Which I fear is exactly why news outlets, traditional and otherwise, aren't talking about it. Ignorance of the public has resulted in so much chaos for our nation, especially over the last 6 years, and keeping people ignorant about the student loan situation or focusing solely on earnings potential for graduates rather than all those things don't graduate, who go to school and do graduate specially for low-paying essential jobs like education and social work, racial inequality of debt load, etc. I had no idea work like Dr. Baker's existed, and that in itself is a problem. Once again, AHP, thank you for shedding light on a super niche, highly relevant, deeply contextual subject! I can't wait to share this article with my public policy class!
I am so grateful every single time you publish something related to student debt.
Fascinating angle, thank you! I feel terrible every time I read stats on undergrad degree attainment across the US and then must face the lack of educational diversity of my friends and family. Yes, my Black family's educational attainment is laudable (from not even high school diplomas to undergrad degrees for all in two generations), but at what cost?
I'm so happy you are highlighting this important work.
I attended a state university, and graduated with about $20k in debt. I paid down some of it, but after my second child was born in 2014 and it made more sense for me to not work, I made the (dumb?) decision to just default on my loan. Honestly, it never really affected me... my partner and I already had a house, and the credit impact is not as scary as they make it out to be. My wages or tax refunds were never garnished, either. I’m now waiting to see the approval from Nelnet on my income based repayment application. I was optimistic for Biden’s forgiveness plan, and sad when it didn’t work out - I’ve only loosely ever used my degree, and it would be nice to not have this hanging over my head for the rest of my life.
I saw the "table setting" questions and found them very important: "What does it mean for college to truly be affordable? Who is provided access to a quality education? What is success in higher education?" When my grandmother went to a state college for a 2-year teaching certificate in the 1920s, she was one of the elite 25% of her generation to graduate from HIGH SCHOOL. So my questions go much deeper than "what is success in HIGHER education" (now sought by about 70% of high school graduates, who are about 90% of all young people).
I wonder, first, why we have come to think "higher" (post-secondary) education is a mandate, and the ways it's been reconstructed as an essential in my lifetime. Today, MA level college grads often need to follow their degrees with unpaid internships to get in line for the possibility of a paid job. Expensive post-secondary career training (eg: Culinary Institute of America) still places you post-graduation in the kind of prep kitchen job you could have done while in high school.
Then, I wonder why we think that "quality education" is the academic kind. I'm a college grad, as are three of my sibs. The sibling who didn't get a college degree (his reading leans to the "Wordless Workshop" in Popular Mechanics magazine) was still able to "dub up" a trailer to haul 2 tons of farm produce to the processing plant. And to design and build his own house. Needless to say, I can't do those things!
Finally, part of the systems task that higher education accomplishes is to sort people by social class. In my time, if you went to Harvard and took an unpaid internship at the Boston Globe, you'd get an offer at the Globe. If you went to Northeastern and had a paid internship at the Globe, you'd get an offer at a small-city daily. Likewise if you went to UMass and freelanced (as I did). So there's some irony in attempting to make college more accessible to more people. Because the jobs and lifestyle that once required a college degree now require advanced degrees and unpaid internships that you need generational wealth to afford. The systems of privilege will just raise the bar.
This is a slight sidewinder from the questions about student loan debt, but people take on that burden with the expectation that it will result in positive life benefits. Which we're seeing it doesn't. Which (in my sometimes cynical mind) it was never designed to do.