Welcome to the Extreme Investor Network blog, where we provide valuable insights and information on personal finance topics. Today, we want to shed some light on the student loan crisis that is impacting millions of students and families across the country.
Every year, millions of new students enter the student loan system, while current borrowers struggle to pay off their debts. This year, the Biden administration’s new student loan forgiveness plan could potentially start clearing debt for millions of borrowers as early as this fall. However, incoming college freshmen are still racking up new balances on their journey to obtaining a degree.
According to a NerdWallet analysis, graduating high school students heading to a four-year college could accumulate an average of $37,000 in student debt to earn a bachelor’s degree. Once families reach their federal student loan limits, they often have to resort to parent student loans and private financing to afford college tuition.
The rising cost of tuition and fees at both public and private colleges has more than doubled over the past 20 years, making higher education less accessible for many families. Without financial aid, the total cost of attending college can reach nearly $100,000 a year, including tuition, fees, room and board, books, transportation, and other expenses.
As families struggle to cover the increasing costs of college, they often rely on a combination of parent income and savings, scholarships, grants, and student loans. However, fewer families are taking advantage of scholarships, with only about 60% utilizing this key source of funding. The majority of families who do not use scholarships cite failure to apply as the primary reason.
Additionally, fewer students are filling out the Free Application for Federal Student Aid (FAFSA), with only 29% of the 2024 high school class completing the form as of April 12. This trend reflects a 36% decline compared to the previous year, leaving many students unsure of how they will finance their college education. Despite these challenges, it is essential for families to explore all available financial aid options to make higher education more accessible and affordable.
At the Extreme Investor Network, we understand the importance of making informed financial decisions, especially when it comes to funding higher education. Stay tuned for more tips and advice on navigating the world of personal finance and investing. Subscribe to our newsletter to receive the latest updates and exclusive content.
