Massachusetts Lawmakers Talk to Students About Loans and Debt – What They Found Out
April 22, 2014

According to the Project on Student Debt, 66% of Massachusetts college grads come out of school in debt and the average loan balance is $28,460. The state ranks 12th in the US for the amount of debt per graduate and 10th in the country for the percent of grads in debt. The increasing debt among their college graduates has spurred state lawmakers there to dig in and find out what can be done to lessen the burden and improve outcomes.

Student panel at Amherst

Massachusetts students talk about important issues
Image source: Bart Everson via Flickr Creative Commons

State legislators hosted a series of seven public hearings at both public and private universities around Massachusetts and a Joint Committee on Higher Education approved a report based on their findings, which will move on within the state legislature to hopefully prompt legislation around the recommendations lawmakers made after these sessions. This is critical for Massachusetts in particular, where over the last three years alone, student debt for those in public colleges in the states has risen by more than 25%.

What these lawmakers found – and what we’ve heard before time and again – is that students taking on student loans have no clear idea how much they’re borrowing and the implications of that debt. State Representative Angelo D’Emilia reports that many students they spoke to didn’t understand that they had to pay back loans at all. This speaks to a huge gap in financial savvy that needs to be bridged as soon as possible.

Here are some of the recommendations from the report and our thoughts on these:

#1 Ensure high school students in the state receive financial literacy courses as part of the core curriculum

This is an excellent suggestion. We’ve heard proposals before to add them to the college core but, by then, many are borrowing and it’s too late. If students gain an understanding of the consequences of student debt, they may be more motivated to work and save while in high school and strive for more scholarship opportunities.

#2 Decrease the time required to obtain a degree by funding and promoting dual enrollment programs

Another great idea. There’s a good bit of overlap between upper level high school courses and lower level college courses, so allowing students to pair college experience while still in high school is a natural fit. Less time in school means less debt. This makes particular sense for low income students who must borrow to matriculate.

#3 Ensure advanced placement (AP) courses are accepted for credit at all public and private state universities

We have to agree here as well. These courses are pushed for high school students but the results aren’t always what they are promised to be. Some private colleges use them only as a prerequisite to allow the student entry into a higher level class without giving the actual credit on their transcript for a passing AP exam. If credit isn’t possible, what’s the point of the class?

#4 Increase and reform state aid, including need-based state scholarships

Any time scholarships can be beefed up, it’s a good thing. What’s unfortunate is that many schools apply scholarships to financial aid packages in such a way that instead of reducing family contribution, it reduces aid offered by the college. This is simply ridiculous. Scholarships the student earns via need or other criteria should reduce what they need to borrow.

#5 Limit state funds accessible to for-profit schools and regulate these institutions more strictly

Another excellent suggestion. For-profit schools take up a huge share of public aid while matriculating far fewer students and graduating even fewer. And many of these schools make private loans to their students at high interest rates that they know are risky and not fair to their students. Any schools graduating low rates of students should be scrutinized.

#6 Reform Massachusetts 529 college plans to encourage saving

This is important, but it’s also important that pressure is applied to federal lawmakers that are pushing to make withdrawals from savings plans for college expenditures taxable. If the state reforms but Congress makes things worse, it will not be a win for parents. This is very important.

#7 Promoting loan forgiveness programs

This is well and good for those already in debt, but preventative measures seem more critical.

#8 Promoting education for skilled employment opportunities

Creating alternate educational pathways for students outside of the college path is important to fill current and upcoming skilled labor shortages and to empower options for those that may not be a fit for college but nonetheless need a path to a meaningful career.

The recommendations resulting from this study are promising and we must hope that they spur some legislation that will make a difference in the lives of Massachusetts’ college students and their families and keep them out of this drastically growing debt. If you have student loans, sign up now for’s free student loan tool to track and optimize your debt. Check our blog often for other legislative updates and student loan news and tips.