College Debt Benefits

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College students are facing an increasing amount of debt as they find ways to improve their career options and human capital. There are many reasons why expenses could pile up and cause some students to impact their financial decisions as well as go further into debt. The question is why are they going into debt and why is it an increasing problem for many? A higher education is an important requirement because it provides many open door opportunities and advantages. Obtaining a degree in college will give you an advantage to be more qualified than other candidates, who only have a high school diploma or GED. Some people believe that having college debt is reasonable and valuable, if it gives them an opportunity to better themselves and…show more content…
Some seniors in high school will not take the initiative to research about scholarships and grants (which they do not have to pay back) prior to their graduation and will wait until the last minute to apply. Additionally, some of them do not research to learn what types of scholarships or grants the school offers and deadlines. As a consequence, they are forced to pay out of pocket or apply for loans to cover expenses while they are in college. It is not a wise decision for a student to take out a loan that they have to repay, however, in most cases, it is unavoidable and is a common way to fund education. According to Kevin Carey from New York Times, “The loan crisis hits the hardest at colleges enrolling large numbers of students from low-income backgrounds. These undergraduates have to borrow for college, then often have difficulty finding well-paying jobs after graduation -- if they graduate at all.” Those who fail to complete a degree are more likely to end up being behind on student loans. Paying late fees and penalties will worsen the problem they created already. As of 2012, 71% of all students graduating from four-year colleges had student loan debt. That represents 1.3 million students graduating with debt, up from 1.1 million in 2008 and 0.9 million in 2004, according to the Institute for College Access and Success. Unlike other types of debt, student loans will not…show more content…
Usually college student who are poor at budgeting and financial decisions tend to depend on credit cards. It might be fun for a moment when they do not think about the consequences. Many credit card companies allow students to spend more money than they actually have. Most have high interest rates and hidden fees, which some people do not realize or read about located in the terms and conditions contract. When reality sets in, they have to pay off their credit cards. If they are careless, they can ruin their credit score and there will be a lot of regret in their choices. “Keep in mind that credit cards can play a vital role in establishing your credit history, so that doesn’t mean credit cards should be avoided. Instead, credit cards should be used to help build a solid credit history and the balance paid off in full each month”.

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