The Ivy League is touted as providing their students with the highest quality education around. Most schools, however, come with a high cost.
The average price of a private four-year college in America is approximately $42,000. Each of the eight Ivy League schools has a price tag far above that—most cost approximately $55,000 per year.
Fifty-two percent of students graduate with student debt from Columbia University. The average amount per student is $18,420. Dartmouth and Cornell are tied at 50 percent respectively. Brown comes in at a close fourth with 45 percent of students leaving with an average of $20,455 in debt.
Princeton and Yale, two of the most prestigious schools, fare pretty well in the student loan department. At Princeton, the average debt is only $5,330. Yale’s average debt is also relatively low, at only $9,254.
Photo: The Ivy League
9. Student Debt Is Lowest in the Southwest
The Southwest not only has the best barbecue, the region also has the lowest average student debt. The winning southwestern state is Utah, with an average of only $17,227. Despite this statistic, 45 percent of college students in Utah graduate with some debt.
Compare this to New Hampshire’s $32,440 average. In New Hampshire, 75 percent of students graduate with debt. New Hampshire is home to the renowned Dartmouth College, where 50 percent of students leave with loans to pay off.
Nevada comes in at a close second to Utah, with a $19,954 average debt and 44 percent of students graduating with loans.
8. Loans Are Really Confusing – Some Helpful Resources
PLUS, FFELP, PLUS, FAFSA, CSS. Good luck remembering all these financial aid acronyms, let alone what they stand for and which ones you’re eligible for.
If you need some guidance, here’s a little primer:
There are three types of loans: student loans, parent loans, and private loans. There are also consolidation loans and the new peer-to-peer loans. Student loans consist of Stafford Loans and Perkins Loans. There are two offshoots of the Stafford Loan, the Federal Family Education Loan Program (FFELP) and the Federal Direct Student Loan Program (FDSLP). Each type of loan has various requirements, standards and rules.
Ostensibly colleges like it when their students perform well. The government likes it, too. In fact, it reward colleges whose students don’t default on their debt. And they punish them when they do. Under a new program, if a college has a 30 percent default rate for three or more years they could lose their ability to apply for federal financial aid. So it’s in a college’s best interest to have their students pay off their debt on time.
To do this, some for-profit colleges have used underhanded tactics to keep their federal funding. The for-profits were called out in a report by the Senate Committee on Health, Education, Labor and Pensions for encouraging students to defer early loan payments. This helps the schools keep their default rates low even though it’s not in the best interest of the student.
Photo: Bloomberg/Getty Images
6. Private Loan Are Risky
Americans have racked up $150 billion in private student loan debt, a sum many families are struggling to repay.
Jonathan D. Glater, best known for his reporting on student loans, explained some of the issues with private loans in a New York Times piece. He says, private loans are not subject to federal regulation and usually have higher interest rates, which may change over time. The lack of governmental oversight also means that the interest rates on private loans are very inconsistent.
It's also important to know that people with private loans don’t have the same protections as those with federal loans.
Photo: Bloomberg/Getty Images
5. African Americans Have the Most Debt
Education is thought of as the great equalizer. But studies show that in terms of debt, it may not be all that equal. Compared to other groups, African American students graduate with the most debt. According to the Center for American Progress, 81 percent of African American students graduate from college with student loan debt. In contrast, 67 percent of Latino and 64 percent of white students graduate with debt.
When minority students leave school, the inequality continues. On average, African Americans and Latinos with master’s degrees earn less than their white peers with bachelor’s degrees.
Photo: U. Baumgarten/Getty Images
4. 1 in 5 Households Have Student Loan Debt
In America we place a great deal of importance on higher education. To that end, almost 20 million people go to college annually. But how many of those students actually pay the full tuition? Not a lot.
The average cost of going to college in America is just shy of $45,000 a year. Approximately 88 percent of students, however, paid less than $15,000 during the 2011-12 year due to financial aid and loans. At Sarah Lawrence, which has been named America’s most expensive college five years running, 65 percent of students receive financial aid.
According to a recent New York Federal Reserve report, 11 percent of borrowers are now more than 90 days delinquent on their loans, which is higher than “serious delinquency” on credit cards.
The report also makes it clear that this figure is understated. It doesn’t account for loans that aren’t in the repayment cycle (such as those in deferment or grace periods). This translates to about 5.9 million people who are behind on their debt payments.
Photo: Image Search/Getty Images
2. Student Loans Hurt the Economy
Graduating with tons of debt is stressful for the student and also further burdens our national economy.
According to a Rutgers study, Bloomberg reports, from 2006 to 2011, 40 percent of college graduates delayed making a major purchase due to their student loans. At the same time, the average salaries for young adults with a bachelor’s degree fell 1.6 percent from 2000-2010.
Considering that the cost of college is rising, students are graduating with more debt, and starting salaries are decreasing, it’s no wonder recent grads are avoiding big-ticket purchases.
Photo: Fotosearch/Getty Images
1. Student Loan Debt Nears $1 Trillion
Student loan debt is now at $956 billion. This is an increase of $42 billion since the last financial quarter. That new $42 billion is made up of $19 billion in ‘old’ debt (debt that was defaulted and carried over to this quarter) and $23 billion in ‘new’ debt. The majority, $864 billion, is from federal student loans and the remainder from private loans. The exorbitant borrowing for education shows no sign of slowing down, either.
Jenna Shapiro is a high school senior in New York City who is passionate about writing and environmental issues. She has previously worked with EcoLogic Solutions. In her free time she can be found reading, biking, or walking her adorable dogs!