Like it’s not enough that college tuition costs are doing their best Jack and the Beanstalk imitation, but with declining state investment in public colleges, more and more of those tuition hikes are falling on students and their families. According to a report released earlier this year by Dēmos, a non-partisan think tank out of New York: “Adjusted for inflation, state support for each full-time public-college student declined by 26.1 percent from 1990 to 2010.” To paint the picture a little more clearly: tuition is going up, state support is going down, incomes are stagnant at best and student debt is the only type of consumer debt that’s continued to climb since 2008. Forgoing college altogether isn’t the answer, but getting in command of your debt is.
The Dēmos study makes clear that although state spending on higher education has increased in actual terms, when the rate of inflation is factored in, spending has actually decreased as a percentage. State spending for public colleges has not even approached keeping up with the rate of overall inflation. At the same time, tuition costs have increased at many times the rate of overall inflation, as is depicted in the graph below. That leaves students and their families to pick up the slack. The result? Loans, loans, loans. Compounding the situation is that weak labor markets are making it difficult for students to find jobs after college, creating quite a challenge when it comes to student loan repayment.
Laden with suggestions to improve this state of affairs, the Dēmos report first and foremost calls for renewed commitment to higher education on the part of state governments. On top of the above-mentioned issues, there is also a continuing boom in the number of students attending college, most of whom are being matriculated into public schools; this is no time to lose state support. Among a number of other recommendations, the report goes on to ask state governments to “recognize the consequences of constant tuition increases;” “align investments in higher education with the goal of completion;” and “think more systematically about how they incorporate borrowing into financial aid programs.”
Hopefully, the pressures currently making it necessary for students to become so dramatically indebted will begin to be relieved. In the current environment, there are loads of fantastic ways to work with student debt and make it more manageable. Income-Based Repayment plans and programs like Public Service Loan Forgiveness provide ways for students to eventually qualify for loan forgiveness. For help navigating the complex machinations of student debt management, borrowers can turn to a number of organizations well versed in helping to optimize student debt.