Average Student Loan Debt $25,250 The “Student Class of 2010” report by the Project on Student Debt found that about two thirds of college students graduated with student debt, in an average amount of $25,250. That’s 5 percent more than the previous year, continuing a steady trend of growing debts.
The national study shows that Louisiana students are significantly less reliant on loans. About 48 percent of college students in Louisiana incurred student debt, the seventh-lowest percentage in the country. Those that do have debt incur an average of $24,548, the 16th-highest in the country. Southeastern Freshman Rebecca Banks said “I don’t have to deal with loan debt because TOPS covers most of it. The remaining of my tuition is paid out of pocket.”
Last Month, nearly 70 percent of voters agreed to renew a 4-cent sales tax on cigarettes. That cigarette tax generates $12 million a year. The will take a portion of tobacco settlement money currently set to be divided between health care and education trust funds, about $40 million per year, and dedicates it to TOPS. Due to this amendment Louisiana students will receive more aid to go to college.
According to the College InSight survey, in 2010 59% of Southeastern students graduated with student loan debt. The average amount of debt for Southeastern students was $36,560 “In the current economic climate, recent college graduates who borrowed for their education face particular challenges in paying back their student loans,” the Project on Student Debt report says.
College graduates are facing an unemployment rate of 9.1 percent. In late October President Obama outlined a new “Pay As You Earn” plan. The proposal would expedite the timeline for an already-approved loan repayment plan that would lower monthly federal student loan payments for Americans whose burden of debt is disproportionate to their earning abilities.
According to the original plan, which Congress approved in 2010, borrowers would be able to reduce their monthly payments from 15 to ten percent of their unrestricted income as of 2014. Additionally, that plan dictated that the balance of borrowers’ debt would be forgiven after 20 years of payments rather than in 25 years.
The president said he would use an executive order to make those benefits available to borrowers as early as 2012. The administration’s plan would also allow recent graduates to consolidate their loans and achieve lower interest rates, and set up a program aimed at helping students better understand their options when taking out loans.
Meanwhile, student debt in America has surpassed credit card debt – and students are increasingly hurtling toward default. “Over the past three decades, the cost of college has nearly tripled,” said Mr. Obama. “And that is forcing you, forcing students, to take out more loans and rack up more debt. Last year, graduates who took out loans left college owing an average of $24,000. Student loan debt has now surpassed credit card debt, for the first time ever. Living with that kind of debt means making some pretty tough choices when you’re first starting out.” Jeremy Williams, Junior Business major comments “I aspire for a higher education to better myself and my career. But will I be ruining myself? I will be in debt for 25 years and possibly without a job.”