Yesterday I attended a presentation by EARN called "Education Debt: the Next Bubble" and realized that we are still not getting it. Initially I was excited to go to this talk because I felt that education debt could very well be the second "housing" crisis. People taking a risk and going into huge debt to invest in their education, not knowing if the returns will actually pay off in the end. Just like with the housing crisis, people believe in being successful after their investment and being able to gain from their investment. As we saw in the housing crisis, this is not always the case. Investing in something so widely believed as a "good" investment and worth the risk is still a RISK and therefore not guaranteed! and the statistics are staggering!
In 2008, students and their debt equaled over $550000000 for private, for-profit schools. The average debt a student in California has is 17,000 and in Massachusetts is 24,000, both lower than a student with debt from a private school (such as USC 30,000). Have you seen many entry level jobs paying anywhere near enough to pay for your living and pay this debt off? There may be some, but there are not enough! and what about all those other jobs that don't need a college degree and pay about the same as a entry level job (at which degrees are pretty much a standard) - not because of the actual work performed, just because everyone else applying has a degree as well. But, that is a different
argument altogether!
More to come on this subject later...
