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:

• "In 2009, the average student graduating from a four-year private university left school with over $27,000 in student loan debt."
• "There are very few ways to get out of actually paying off student loans, including joining the Peace Corps, AmeriCorps, some teaching programs, or the military, or by dying."
• "[E]ven declaring personal bankruptcy does not relieve you of this tremendous burden."

The article goes on to offer a short primer on the types of government loans for which students may apply. The three types are:

1. Federal Perkins loan;
2. Federal Subsidized Stafford loan;
3. Federal Unsubsidized Stafford loan.

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:

1. An alternative payment plan that lowers the money amount demanded from the debt holder;
2. A deferment, which extends the automatic initial grace period for another predefined period (though interest continues to accumulate during this period);
3. A forbearance, which suspends payments for a period of usually six months to a year (though interest continues to accumulate during this period, and the borrower takes a credit-score hit).

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.