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Students are leaving college with bigger debts than ever. Why? Because
they can.
Here's
the Federal Reserve Bank report.
Here's
breaking news you should consider.
Ned
Vizzini writes:
But while private colleges pile on to the idea of expanded scholarships
and grants, state schools increasingly exclude students in the middle
class who they were intended to support.
They do so through student loans. Across the country, states provide
state loans to students through non-profit corporations that are accountable
to no one and increasingly corrupt. In Iowa,
the Iowa
Student Loan Liquidity Corp. is one of the worst offenders, under
investigation by the attorney general for pursuing aggressive loan tactics
and giving colleges incentives to steer business their way.
Meanwhile, students attending the private University of Iowa graduate
with an average of $20,234 in debt, below both the national and state
averages. The idea that public colleges leave middle-income graduates
better off financially than public ones is simply wrong.
The solution is to do away with government
student loans completely. What makes Harvard's plan so lauded
is that it is a "no loan" policy, like Princeton's, Amherst's,
and Williams'. It relies on straight grants and scholarships. A student
from a household earning $120,000 to $180,000 will pay 10 percent of
their income per year. A student from a household earning $60,000 per
year will pay nothing at all.
From
the AP:
The University of Pennsylvania on Monday joined Harvard and other elite
private colleges in announcing loan-free financial aid programs aimed
at middle- and upper-middle class students.
Penn officials said they will begin giving loan-free packages to eligible
undergraduates in those income categories starting in the fall of 2009.
The school will phase in the changes by eliminating loans for students
with family incomes under $100,000 (€68,920), replacing them with grants.
At the same time, the Ivy League school will reduce need-based loans
by 10 percent for students whose families make more than $100,000 (€68,920).
Penn already covers full tuition and room and board for students whose
families earn $60,000 or less. Penn costs about $46,000 (€31,700) a
year for tuition and room and board.
From
PE.com:
As college costs continue to climb, more students and parents are
borrowing money to pay for education. And it's only going to get worse.
Tuition and fees at public four-year universities nationwide rose 54
percent over the decade from 1997-98 to 2007-08, and 33 percent at private
four-year universities, after adjusting for inflation, according to
the College Board. Fees at California's public four-year universities
have nearly doubled since 2000. Increases are imminent next year unless
the state's budget situation improves. The average fee for a UC undergraduate
has risen from $3,964 a year in 2000-01 to $7,347 in 2007-08. Similarly,
fees for Cal State students have increased from an average of $1,839
a year in 2000-01 to $3,521 this year.
Housing, food, textbooks and transportation can add another $15,000
a year to the equation. Even among low-income students, subsidized loans
typically make up a larger proportion of financial-aid packages than
grants and scholarships, which don't need to be repaid.
For those who don't qualify for low-interest federal loans, borrowing
from private sources has skyrocketed in the past decade and now equals
about 24 percent of total education loan volume. Robert Shireman, executive
director of Project on Student Debt, a nonprofit policy research group,
said the problem with private loans is that they often have variable
interest rates and lack protections for borrowers in case of unemployment
or disability.
From
report:
Decreasing life insurance premiums, innovative product enhancements
and upcoming changes in underwriting make it an ideal time to put financial
security at the top of your New Year's to-do list. "As costs continue
to go down and the number of product options available increase, there
is no longer an excuse for not having adequate life insurance coverage,"
says David F. Woods, CLU, ChFC, president of the Life and Health Insurance
for Education. "In the New Year, Americans should really look to take
advantage of these trends and work with a qualified insurance professional
to ensure they are selecting the best possible coverage to fit their
specific needs."
To help consumers start the New Year off right, the non-profit LIFE
Foundation reviews four key trends it hopes will encourage more Americans
to get the life insurance coverage they need in 2008: Life insurance
premiums continue to decrease -- "About three-fourths of Americans think
life insurance is too expensive to fit into their family budget, but
the reality is that that's no longer the case," says Woods. Industry
experts say that term life insurance premiums have reached an all-time
low, in part due to people living longer and increased competition among
companies.
Permanent insurance has also seen a slight decrease in cost. However,
Woods notes that Stranger Originated Life Insurance products (STOLIs)
could have an adverse effect on pricing if companies decide to raise
premiums for older insured's in an effort to offset the potential influx
of guaranteed payouts happening around the industry. Consumers should
take advantage of these current low rates, whether to purchase more
coverage or even qualify for lower rates on the coverage they already
have.
LIFE's online calculator (http://www.lifehappens.org/howmuch) can help
people get started evaluating how much life insurance they need. Term
life insurance maintains popularity, with whole life close behind --
Because of its affordability, term life insurance continues to be the
product of choice for many Americans, especially young families.
According to LIMRA International, industry-wide sales for term life
insurance policies increased eight percent from 2006 to 2007. The current
volatility in the stock market means that Americans are seeking more
stable, guaranteed products. Whole life policies have gained traction
among those who are looking for something permanent and predictable
over products such as variable life, whose benefits vary depending on
the stock market's performance. In 2008, consumers will continue to
have a multitude of choices for finding the right life insurance policy
to fit their needs and can access LIFE's online decision guide at http://www.lifehappens.org/whatkind
to get started.
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