What Is the Student Debt Crisis?
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Student Debt Crisis, Explained in 100 Words
History of the Student Debt Crisis
As part of the National Defense Education Act and a desire for an educated society, student loans were created The Higher Education Act of 1965 expanded student loan options for borrowers Sallie Mae was created in 1972, which used to be government-backed but went private in 2004 The Great Recession happened from 2007-2009, leaving millions unemployed and going back to school After the recession, funding for higher education was slashed in many states, putting the burden on the borrower Occupy Wall Street occurred in 2011, which shed light on the rising education costs and student loan crisis As of March 2020, student loan borrowers got some relief with payments put on hold during the Coronavirus pandemic
Decreased State Funding
Access to Student Loans
Cost of College Over Time
College Graduate Median Earning Over Time
$54,569 in 2012 $56,479 in 2013 $55,613 in 2014 $58,476 in 2015
Effects of the Student Debt Crisis
Student Debt Relief
3 Student Loan Refi Tips
Once the pandemic-related pause on federal student loan payments ends, going back to making payments may be hard on budgets. One solution is to refinance to a lower interest rate, longer loan term, or both, depending on your situation. (The tradeoff is that you’ll be forfeiting federal benefits such as repayment programs.) Find and compare your student loan refinance options. Paying extra each month on your student loan can reduce the interest you pay and so lower your total loan cost over time. (The law prohibits prepayment penalties on federal or private student loans.) If you teach full-time for five complete and consecutive academic years in a low-income school, you may be eligible for federal student loan forgiveness.
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