The college grads are doomed. Here’s what they can do
I’m a college graduate; I received my degree in communications with very little debt that was easy to pay off. This was an exception, not a rule. According to Nerdwallet about 70% of graduates hold a high amount of debt, an average of 37 thousand dollars, a substantial amount for students newly released from the safety of the university dorms into the hit or miss work force.
I was invited to a friend’s get together, who was in the final year of his degree, where I met a sundry of different students he had class with. I met a group of people and we talked for a while when a lull in our conversation occurred. Me being the iconoclast that I am asked “what do you guys think the average debt of everyone here is?”
One person responded with, “10,000?” Another, “no way, more like 50,000!” The numbers varied but it sparked an interest. I met several people, when I was in university, who held a substantial, higher than average, debt. Many of these people shook it off, hoping that they would find a career after college to pay it off. But, the stats do not bode well for most.
The total debt reported from the Federal Reserve is 1.4 trillion, held between 44 million Americans. That’s roughly 13 percent of the U.S. population. For comparison the total US debt is about 15 trillion dollars. This debt is hard to pay off and it’s not getting any easier.
The average debt has risen by about 10,000 in the last 20 years and so has the monthly payments made by students to pay back the loans. This has taken toll nationally as we can see homeownership has been on the decline as debt rises. The study from nerdwallet shows us that the average 2015 graduates will postpone retirement until the age of 75 whereas a decade ago 62 would the national average retirement.
A nationwide survey from Student Debt Crisis 7,095 adults from all 50 states showed 65% of loan borrowers to have 1000 dollars in their bank account; 20% reported being unable to make their next loan payment, while 44% reported that making their next payment would be a struggle.
Aison Abel and Richard Dietz of the Federal Reserve Bank tell us that about 27% of graduates obtain the career of their aim. Now, this may seem all doom and gloom but we should consider our options when it comes to working with future graduates. What can students do to minimize their likelihood of a high debt?
Something to consider is the old adage: an ounce of prevention is worth a pound of cure. Choosing the right degree, one that is highly sought after, will help set the path to earning more, to decrease the ratio of debt to income. This can also bring security to your life, helping abate some of the stress likely to come to those in debt as 86% said student debt is a major source of stress, and of respondents, one in three said it’s their biggest source of stress. (Student Debt Crisis.)
Now, we should be sure to talk about passion versus practicality; this article is not written to deter you from seeking your passion but I recommend considering research into each degree and looking at the unemployment rate and annual salary therein. Art degrees such as film, photography, music, and other degrees or studies can be sought after later in life, after a secure income has been developed. These degrees have a higher unemployment rate than the national average. Think of it like this: we love Nutella. But will a degree in the sociological effects of Nutella in the Antarctic get you job selling stocks?
“When the economy is robust, the demand for the arts goes up,” says Carnevale, director of Center on Education and the Workforce (CEW) at Georgetown University “but in a recession, they are the first victims.”
The preventative measure
Occupational Therapy, translation, web development, nursing, engineering, and physician studies are great academics to get involved in, each with low unemployment rates and a growing demand.
Translation services are expected to grow up to 28 percent by 2021. Plus, when you graduate with a BA or BS you will be able to teach English in a foreign country to go and seek fluency in the desired language. Just be sure that language is in growing demand and not, say, Latin or Greek. This is just one example of research one could do.
Watching the trends of the market, even with a general eye can direct you on the best path of a career. Advertising is growing, with the ever growing reach of Google and FB with it’s thousand tendrils of breaching ad in our lives, so expect new sorts of advertising jobs that might include some of your passions. This would open the doors for the computer science and psyche students or advertising and psyche. Remember, Big Brother is watching, and so can you!
Internships and mentor-ships
These programs are highly valuable. As a student graduating a class with many others, what can one do to set themselves up for success? Many employers look at experience, not only degree. Employers normally ask for two basic things: experience and degree… plus experience. If you can get an internship, even unpaid (this should be seen as an investment of time towards your future) it will benefit you. A foot in the door you might say. It may seem more nihilistic to see your peers as competitors but it is the truth, especially if you seek a job in the same city as these people might be seeking the same positions. The amount of adults with Bachelor’s degrees has doubled in the last 35 years. This is a hard truth you will learn if you haven’t any experience to bring to the employers table after graduation.
Income Sharing Programs
Income Sharing programs are offered by some colleges and can be beneficial. Colleges are now taking on some of the financial weight and allowing students to pay back the school directly through a set percentage of monthly/yearly wages. This is an interesting concept and might be the way more schools go, one of the benefits to students is the investment; schools would be less likely to stamp a degree and hand it out like coleslaw in a family style buffet. Being successful and getting a good job means being able to pay them back.
Scholarships and grants
These are available for a litany of different successes in life. Some are available to those from different backgrounds while others are intended to help some get people back on track with their lives to build themselves a more successful future.
Studentaid.ed.gov has a full list you can research into but don't forget private scholarships that might be geared towards you. Look back on your earlier academic work, the clubs you might have joined, the sports you might have played, anything is worth a shot if it helps you get out of college with even a marginally fractioned debt.
Quick and simple routes to paying off your school loan debt normally don't work, so stick with the basic measures and pick the right degree, use all the grants and scholarships available, and apply yourself with full tenacity to the work force.