Our country is reeling from debt repayment.\u00a0 One out of every 10 people are listed as unemployed but we all know that many more are unemployed (those who were not listed as unemployed before the recession but are still wanting to work, those stay at home moms who are now ready to work but there are few jobs available which fit them, those who have graduated from school but cannot find work, and those who have been laid off and no longer qualify for assistance).\u00a0 These people are having a difficult time paying their mortgage.\u00a0 In addition, they are taking on higher personal credit card debt to\u00a0provide for daily living expenses.\u00a0 \u00a0It is bad out there but just when you think the\u00a0recession could not get worse, along comes the student loan.<\/p>\n
For many years college students have been paying for their education through work, grants, and loans.\u00a0 Once a student is accepted into a school, they are almost automatically qualified to receive a student loan.\u00a0 That does not mean that\u00a0students really qualify to repay<\/strong> it but schools don’t care.\u00a0\u00a0Schools need the student count and the students money (FSU just laid off 21 tenured profs due to budget constraints).\u00a0 Their concern is to pay their bills and the way they do that is through receiving student loan checks.<\/p>\n Under the old economy,\u00a0college graduates could expect to receive a good job following their graduation and therefore\u00a0easily\u00a0make their monthly\u00a0student loan payment.\u00a0\u00a0 With college enrollment up 17% since 2000, there is a lot of money being borrowed.\u00a0 In 03-04 the average college graduate owed 17,125 but in 07-08 the average college student graduated with $23,000 in student loans.\u00a0 That is a huge increase in personal debt.\u00a0 Nearly 66% had received some amount of student loan.\u00a0 The typical government backed student loan is around 4.5%.\u00a0 This means that in addition to paying for a car loan, car insurance, and other living expenses, the average college graduate now holds a student loan of\u00a026,719\u00a0and will pay around $250 per month for the next 10 years.\u00a0\u00a0 If they graduated from a private four year college, that amount is 29,000 which slightly increases the loan payment.<\/p>\n So, with all this debt and a bleak outlook in the job market, how will this affect contributions?\u00a0 Students, and all Millennnials, love helping others.\u00a0 They are quick to contribute time, energy (when they aren’t at the mall with mom!) and are ready to toss in cash to any personal needy cause\u00a0they see.\u00a0 They even make commitments for future donations…all with OR without a job.\u00a0 What that means is this:<\/p>\n 1.\u00a0 They live on hand outs from relatives.<\/p>\n 2.\u00a0 They spend when they have it and narrow their choices in spending or giving.<\/p>\n 3.\u00a0 They don’t just give to a cause because their ‘suppose’ to contribute.<\/p>\n 4.\u00a0 When they give, they are doing so on the back of someone else, usually their parents because they end up asking for more help from them.<\/p>\n 5.\u00a0 They give less to organizations….they don’t have it to give.<\/p>\n 6.\u00a0 Churches and organizations that put themselves in debt\u00a0better bail themselves out before the boomers die off.<\/p>\n 7.\u00a0 Churches and organizations that center their operations around building, may have a generation coming that cannot even pay the light bill nor may they want to.<\/p>\n What can you do to help a student:<\/p>\n 1.\u00a0 Encourage them to select an affordable college.\u00a0 Maybe community college then transfer for the big name on the plaque school.<\/p>\n 2.\u00a0 Help them understand that life is tough and jobs are often earned by hard work.<\/p>\n 3.\u00a0 Help them structure their finances.\u00a0 Move them from relational spending to budget care.<\/p>\n 4.\u00a0 Start by telling 8th graders the importance of good grades in receiving grants for college.<\/p>\n 5.\u00a0 Help those who receive grants understand that maintaining great grades is their #1 job.\u00a0 It provides the money for the grant!<\/p>\n 6.\u00a0 If you are a parent, hold somethings back.\u00a0 Challenge your student to understand your money is not theirs. Make sure they ‘feel’ what responsible living is like in life.<\/p>\n 7.\u00a0 As a parent, get your financials in order.\u00a0 Life is more caught than taught.\u00a0 Let your kids see good borrowing practices and how it impacts your spending, savings, and contributions.<\/p>\n A couple of resources:<\/p>\n http:\/\/www.usatoday.com\/money\/perfi\/college\/2010-07-11-college-funding_N.htm<\/a><\/p>\n