8 Dec 2011

College Graduates Debt Obscurring the “American Dream”

Author: Kara Campbell-Curl | Filed under: Enterprise Story, Fall 2011, Student Contributor

By: Kara Campbell-Curl

A higher education comes at cost. This cost is becoming more of a burden to the American people every day. That burden is debt.

Bowling Green State University graduates are facing the highest amount of debt for a public university in the state of Ohio, with an average amount of $31,515 in 2010. This means a total of 76 percent of students find themselves in debt once they graduate,  this is according to the “Project on Student Debt” conducted by the Institute for College Access and Success. The average BGSU graduate finds themself in 13 percent more debt than any other college graduate in the state of Ohio.

Bowling Green State University – Main Campus Undergraduate
Average Debt of Graduates in 2010 $31,515
Proportion of graduates with debt in 2010 76%
Nonfederal debt, % of total debt of graduates 2010 42%
Full-time enrollment fall 2009 13,162
2009-10 In-state tuition and fees $9,060
2009-10 Total cost of attendance $ 21,125

Source: Project on student debt

BGSU alumnus, Ashley Zimmerman, is included in that 72 percent. Her story is even more unique. Ashley graduated in May of 2009 with $60,000 in debt and a month later had a baby girl, complicating the re-payment process even more.

Ashley was unable to find employment in her field of study, psychology, and is now working two retail jobs that are only paying here minimum wage.

“I didn’t have the time or the resources to find a job in my major in the area that I live,” said Zimmerman. “I just knew I needed to find a job within that six month grace period or I was going to fall even further behind in my debt.”

Not only do college graduates have to worry about their debt being repaid, but some run into other very important factors that need to take precedence over finding their perfect career.

“I didn’t only have to worry about getting myself into the real world but I had a child to take care of as well,” Zimmerman said. “Student loans were the last thing on my list of things to get started on.”

This is where we see the biggest impact, according to Matthew Reed, program director of the Institute of College Access and Success.

Matthew Reed, director of programs for the Institue of College and Success. Photo taken from the Institute's website.


“The debt college graduates face affects the rest of their lives, and has them thinking about when to make important decisions,” Reed said. “Things as simple as marriage, purchasing a home or even when to have a family are all impacted by the massive amounts of debt graduates have.”

In order to understand how financial aid is awarded and distributed we have to break down the process.

Millions of students sign up for financial aid from the government every year through sources like Federal Student Aid, an office of the U.S. Department of Education, by filling out a FAFSA application.

According to the department of education, filling out a FASFA application provides students and their families with a variety of services ranging from educating them on student loans, to distributing billions of dollars in funds to students through the university of their choice.

The university will distribute the funds to the students based on the students expected family contribution (or EFC) determined by the student filling out the FAFSA application.

The portion of the expenses that the grants awarded from filling out a FASFA do not cover must come from another source.

Students have three main options for paying for that uncovered portion of their college expenses. The options are student loans, parent loans and private loans.

Photo taken from a story by the PecanGroup.

Some students are able to depend on their parents, who might pay out of pocket or take out a parent plus loan.

However, when the student loans don’t cover the unpaid portion of the bill some are forced to turn to private loans that come attached with sky high interest rates.

The average interest rate on a private loan is from anywhere between 3.25 percent and 9.50 percent according to Chase National Bank.

According to the Smart Student Guide to Financial Aid more than $100 billion in federal education loans and millions are distributed each year.

“Private loans many times don’t need to be taken out, and should be your last resort,” said Reed.

According to the Institute for College Access and Success, the average amount of debt for students at Ohio’s public universities is $27,713. With an above average of 68 percent of graduates in debt. This is compared to the national average of $24,000. Ohio’s college graduates owe 15 percent more money in debt than the average college graduate in the United States.

“I roughly have close to $25,000 worth of debt,” said BGSU senior Ricardo Donald. “When I graduate I plan on that number being closer to $30,000.”

With the average amount of debt being $27,713 that figure alone might be enough to make perspective college students nervous, and leave current college students feeling stressed out and overwhelmed. What about the students those who aren’t lucky enough to have only $27,713 in debt? The thing is there are a handful of graduates that have acquired debt totals that have far exceeded the average.

Jordan Zapotechne, a graduate from Cleveland State University is a part of that handful. He has accumulated approximately $55,000 that he has just recently begun to pay back in payments of $500 a month.

“Paying the $500 a month is hard and very overwhelming,” said Zapotechne. “I feel like I am paying two rent bills every month!”

Being $55,000 in debt is a huge burden to have to take on. However, that is before the interest is added on. Once he attaches the interest to that number it climbs to be closer to $100,000.

“I’m currently working two jobs. Neither of which pertain to my psychology degree,” Zapotechne said. “In order to work in my field I pretty much need my masters, which I can’t afford right now.”

Since there is such a high percentage of students struggling with unreasonable amounts of debt shouldn’t the government find a way to distribute more money to students in need?

The question of the amount government aid maybe a question on the minds of many people as they try to understand why they owe so much money for wanting to get a higher education.

“Tuition is being raised because the universities themselves are receiving less money from the state. This sometimes puts them in budget trouble,” Reed said.

What may come as a surprise to people in need of more money for their education is there is a lot of money that is available to people in need. It just isn’t always the easiest to find. The money that is being referred to is money from grants and scholarships.

“The government does help, but It only seems like enough to get by,” Zimmerman said. “I still cannot get over how much money I owe back to the government that does not even have the jobs to help me support and back up my educational journey.”

According to Student Grants, an online source aiding students in finding grants and scholarships, grant money can come from almost anywhere. Since most grants may receive low publicity, many don’t even know that they are available.

“Most people are left in the dark when it comes to financial aid,” Donald said. “It isn’t advertised enough that there is money out there for people to just have basically.”

“Apply for FAFSA! Get as much money as you can. I can’t stress that enough,” said Reed.

Grants are available to everyone. You don’t need to be a straight A student to receive a grant. Some are as simple as filling out a quick application. You just have to know where to look. This year 3 billion dollars will be distributed in financial aid money. So where should students begin to look?

According to Student Grants, among the top places to find grants would be financial administrators, college publications, professional associations and website listings.

In order for future students to minimize their debt they should come up with a financial plan says Reed.

“Students need to consider other things like room and board and cost of living into their budget when they are shopping around for their perfect school,” said Reed.

Also take the time to use net price calculators which are located on many universities websites as well as on the institute of College Access and Success website.

“These calculators are very helpful when estimating all of the student’s college expenses,” Reed said.

Planning out your colligate career can be more beneficial in the long run especially when it comes to the financial aspect of it.

“Planning is the key to lowering and even potentially eliminating high amounts of debt,” said Reed.

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