The Occupy Wall Street and Occupy Colleges movements are largely driven by citizens who are not able to pay off their debts. While Countrywide engaged in predatory lending that led to an enormous real estate bubble, Sallie Mae has taken a lot of heat for offering student loans to “unworthy” teenagers with unrealistic and impractical professional goals.
Student loans just came due this past November and December 2011, yet college graduates are in even more debt after earning their degrees.
Outstanding student loans are growing by approximately 5% every year and nearing an exorbitant $1 trillion, surpassing even consumer credit card debt. Salaries are decreasing and college costs – along with living and medical expenses – are rising at an annual rate of 5%.
“New Federal laws make it next to impossible for someone under 21 to get a simple credit card, yet the same people can obligate themselves to tens of thousands of dollars in student loan debt with absolutely no problem,” said SmartCredit.com President of Consumer Education John Ulzheimer. “This, of course, makes no sense as student loan debt is arguably worse than credit card debt.”
According to a recent New Yorker piece, almost 14% of college graduates from the classes of 2006 through 2010 can’t find full-time work. Overall, 55.3% of people ages 16 to 29 have jobs – the lowest percentage since World War II. Today, one in five young adults lives below the poverty line.
If you’re one of those individuals who made the ambitious move to take out student loans, Ulzheimer has four tips to help you fight the struggle:
1. Consolidate multiple loans into one giant one. Student loans are reported to the credit bureaus on a disbursement basis. For example, if you take out five loans to pay for college, then you’ll have five unpaid loans on your credit reports. The fewer the number of loans on your credit report, the better your credit score.
Naresh Vissa [send him mail] is a junior accounting, broadcast journalism and finance major.