An article in the January 12, 2011 edition of The Observer, the student newspaper of Case Western Reserve University, offers some handy advice on how to manage student loan debt. This advice couldn't be timelier, as debt burdens assumed by college students these days have surged. The Observer article presents these sobering facts:
Though these loans have different terms and conditions with respect to the amount a student can borrow, the timetable of interest accrual, and so on, they share one important feature: a six-month grace period.
Once this grace period expires, however, Uncle Sam begins demanding his money back. Thus begins an American worker's true education -- dealing with massive debt.
Loan consolidation presents one option. "Consolidating your student loans means bundling all of your loans with a single lender and payment plan," the article informs readers. "This may lower your total monthly payment due, but will extend the terms of the loan and result in paying more interest in the long run."
The article states, however, that the decision to exchange lower payments for greater overall expense (in terms of more interest paid on the principal amount) has its advantages in certain circumstances: "Despite the lengthened payment period, consolidation can still be very useful in some instances."
Of course, the option of loan consolidation assumes the borrower's ability to pay, something which is not always certain in these uncertain economic times. For those having difficulty mustering monthly loan payments, essentially three options present themselves. These are:
Borrowers must qualify for these options. If granted, they can bring some relief to college graduates who have fallen on hard times -- though generally at the expense of their future spending power. It seems, then, that when it comes to educating a populace so as to remain economically competitive with other developed nations, the United States needs to go back to school.