25 years old and deep in debt

[Phillip V]

The White House proposes that the government forgive billions of dollars in student debt

Ohboyohoboyohboyohboy

SUBSCRIPTION ONLY GIVE ME A SUMMARY MAN

The proposal, included in President Barack Obama's budget for next year, would increase the number of borrowers eligible for a program known casually as income-based repayment.

Borrowers in the program make monthly payments equivalent to 10% of their income after taxes and basic living expenses, regardless of how much they owe. After 20 years of on-time payments—10 years for those who work in public or nonprofit jobs—the balance is forgiven.

Under the program, most borrowers with loans issued since October 2007 are eligible to participate. The budget proposal—which requires congressional approval—would let all borrowers with pre-2007 loans participate and would make tax exempt any debt forgiven through the program. (Loan forgiveness can be considered taxable income.)
...
Liliana Rodriguez-Marshall, a 30-year-old mother of three who graduated from Southwestern Law School in Los Angeles in December owing more than $300,000 in federal loans, plans to take advantage of the current program.

"Without it [my debt] would be unmanageable," she said.

Ms. Rodriguez-Marshall said she racked up the debt by spreading her degree over 4½ years from the normal three and taking out student loans to cover living expenses, which the government allows.

During her studies her husband was laid off and she twice had to take out emergency student loans totaling more than $30,000 to make home repairs, pay unexpected medical costs and keep up with the family's $1,000-per-month health-insurance bills, she said.

She now is applying for government jobs that pay about $55,000 a year. According to a repayment calculator created by the New American Foundation, a Washington-based think tank, Ms. Rodriguez-Marshall would pay $273 per month in her first year under the program; without it, she would owe $3,562 a month. Under the program, she would pay about $102,000 over 10 years, and the government would forgive about $639,000, which includes interest.
...
Critics say the administration underestimates the costs. Economists at Barclays PLC said the current program, along with loan defaults, could cost the government $300 billion between now and 2020. Barclays hasn't released an estimate of the Obama proposal's costs.

[CountDeMoney]

During her studies her husband was laid off and she twice had to take out emergency student loans totaling more than $30,000 to make home repairs, pay unexpected medical costs and keep up with the family's $1,000-per-month health-insurance bills, she said.

But see, that's all her fault.

[Phillip V]

It's cap & groan time

The class of '13 has no luck at all. As the graduates take to the streets with their six-month grace periods before their student loan debt bills begin arriving, they face a horrific job market.

"At 16.2 percent, the March 2013 unemployment rate of workers under age 25 was [roughly] twice as high as the national average," in the words of a recent report on young people entering the work force. Young people starting out are normally at a disadvantage because they are trying to establish themselves in a profession.

Like Kristine Gutierrez, 22, of Park Slope, who recently graduated from the University of Colorado. She has two part-time jobs earning under $24,000 a year and has college debt she is trying to pay off. Gutierrez says she "is struggling to pay for things in New York," and had to move in with friends.

http://www.nypost.com/p/news/business/it_cap_groan_time_nO6yKVt81n2qa5mwvMC0PO

[CountDeMoney]

I can't worry about new grads, I've got my own problems.

[HVC]

I can't worry about new grads, I've got my own problems.

you're over looking the opportunity to be a sugar daddy

[CountDeMoney]

I can't worry about new grads, I've got my own problems.

you're over looking the opportunity to be a sugar daddy

Not much market for unemployed sugar daddies.  That's more like sugar-free.

[HVC]

I can't worry about new grads, I've got my own problems.

you're over looking the opportunity to be a sugar daddy

Not much market for unemployed sugar daddies.  That's more like sugar-free.

you'll get sugar before they do. Long term planning

[CountDeMoney]

I've got a cat.

[HVC]

I've got a cat.

[garbon]

Like Kristine Gutierrez, 22, of Park Slope, who recently graduated from the University of Colorado. She has two part-time jobs earning under $24,000 a year and has college debt she is trying to pay off. Gutierrez says she "is struggling to pay for things in New York," and had to move in with friends.

Most people her age struggle to pay for things in New York and have to have roommates.

[DGuller]

Like Kristine Gutierrez, 22, of Park Slope, who recently graduated from the University of Colorado. She has two part-time jobs earning under $24,000 a year and has college debt she is trying to pay off. Gutierrez says she "is struggling to pay for things in New York," and had to move in with friends.

Most people her age struggle to pay for things in New York and have to have roommates.

Manhattan, yes.  Park Slope, not necessarily.

[garbon]

Like Kristine Gutierrez, 22, of Park Slope, who recently graduated from the University of Colorado. She has two part-time jobs earning under $24,000 a year and has college debt she is trying to pay off. Gutierrez says she "is struggling to pay for things in New York," and had to move in with friends.

Most people her age struggle to pay for things in New York and have to have roommates.

Manhattan, yes.  Park Slope, not necessarily.

Most people I know in the outer boroughs have roommates...whereas most people I know who can afford to live in Manhattan...live alone.

[garbon]

Besides Park Slope isn't really that cheap - maybe if we were talking Bushwick.

[Berkut]

You know, the cost of higher education in teh US has gone up something like 1000% over the last few decades.

Economically, that is simply not possible in anything even approaching a closed system.

The only rational explanation for how that could possibly happen is rather obvious - when you have some external factor pouring huge amounts of money into the pockets of those who purchase the commodity for the express purpose of buying said commodity, then gee, what a shock - the business looking to get as much of that cash as they can are going to raise their prices to pull in more and more and more of those dollars.

So yeah, great plan, lets just go an dump some more external billions into that side of ledger. What could go wrong?

[Baron von Schtinkenbutt]

How Colleges Are Selling Out the Poor to Court the Rich

A new report finds hundreds of schools are charging low-income students obscene prices, even while lavishing tuition discounts on their wealthier classmates.

Neat fact: If the federal government were to take all of the money it pours into various forms of financial aid each year, it could go ahead and make tuition free, or close to it, for every student at every public college in the country.

Will it ever happen? Ha. Not unless Bernie Sanders somehow leads a Latin American-style coup down Pennsylvania Avenue. But one of the reasons I argued for the idea a couple of months back was that it would allow us to finally stop burning money subsidizing obscenely expensive tuition at dubiously worthwhile private institutions. At the time, I singled out the for-profit college industry, which has been rightfully savaged for devouring federal aid dollars while charging poor students backbreaking prices.

Today, though, I'd like to apologize to the University of Phoenix and its kin. It seems there are plenty of traditional, non-profit colleges leeching off the system as well.

For proof, see the demoralizing report released this week by Stephen Burd of the New America Foundation on the state of financial aid in higher ed. It documents the obscene prices some of the poorest undergraduates are asked to pay at hundreds of educational institutions across the country, even as these same schools lavish discounts on the children of wealthier families in order to lure them onto campus. 

And here's the key bit: Many colleges, he argues, appear to be playing an "elaborate shell game," relying on federal grants to cover the costs of needy students while using their own resources to furnish aid to richer undergrads.

"With their relentless pursuit of prestige and revenue," Burd writes, "the nation's public and private four-year colleges and universities are in danger of shutting down what has long been a pathway to the middle class for low-income and working-class students."

You can read the rest over on the Atlantic's site.