Scott G Winterton, Deseret News
NEW YORK — Holly Hatfield hardly ever eats out. She can't afford health insurance and hasn't gone on vacation in five years.
The 28-year-old lives in a tiny one-bedroom apartment in New York City as a graduate student at Columbia University but hopes to one day travel around the world, bringing essential items like water, food and medical supplies to villages in Kenya, Niger and Malawi.
It's nice to have that kind of vision in the back of her mind but sometimes it's hard to imagine how she is ever going to get there — financially. When she graduates, she will have more than $100,000 worth of student loans to pay off, and that's after working about 30 hours a week to keep up with expenses like housing.
"I never stop thinking about money," laments Hatfield, who is studying sustainable development. "I am going into a field that will help change the world and save lives, and I'm going in knowing I will be poor for the rest of my life. I am resigned to the fact that it is going to be a long, hard road financially."
Like Hatfield, millions of students nationwide are going into debt, more so than ever before; two-thirds of students now graduate with some amount of debt, The College Board reported. College students are also taking out more loans than they have in the past — averaging about $24,000 worth of debt at graduation, according to an October 2010 report by The Project on Student Debt.
Just last month, the U.S. Department of Education also announced that more students are defaulting on their loans than ever before with 320,000 students, or about 8.8 percent of borrowers, defaulting from the time they took their loan out in 2009 to 2010.
But for every borrower who defaults, at least two more are delinquent on their student loans, the Institute for Higher Education Policy found, and just 37 percent of borrowers are able to make timely payments.
Drowning in Debt
Part of the problem, experts say, is that tuition prices are rising much faster than grant aid or family income. Over the last 10 years, public four-year institutions have seen their tuition prices rise steadily over inflation by an average of 5.6 percent, with some colleges doubling or near doubling tuition from the 07-08 year to the 09-10 including colleges in New Mexico, Florida, Georgia and California, according to a news release by the U.S. Department of Education.
Another compounding factor is that once students graduate, they are having a tougher time finding a job.
The unemployment rate of students with bachelor's degrees was 4.3 percent in June, which is half that of those without a degree, but it is twice as high as it was before the economic downturn, said Mark Kantrowitz, a financial aid expert and publisher of FinAid.org and FastWeb.com. But even those who find a job aren't getting paid as much as they used to, said George Leef, director of research for the John William Pope Center for Higher Education Policy based in Raleigh, N.C. Leef said that 35 percent of college grads today are underemployed.
This is something that Jessica Allen, a second-year student at Roseman University in South Jordan, worries about. Allen, who will be taking out over $100,000 of debt by the time she graduates, said since she started pharmacy school, the need for pharmacists in Utah has decreased. This is part of the reason why she works every Saturday – to get her foot in the door. She also didn't want to take out more loans.
"I have never been surrounded by debt before," Allen says in between studying for an exam. "I am not naive. I have seen it destroy people's lives. I don't want to get stuck in debt."
But getting into student debt has also become a norm in society today, with a group of students who have "unprecedented access to debt," said Rachel Dwyer, a professor at Ohio University who has studied young adults and debt. Her most recent study, which was published in August in Social Science Research, found that young adults get a self-esteem boost by going into debt.
- New BYU president: Kevin Worthen to replace...
- 'We're not going to stop': Parents of Anne...
- Community comes together to surprise...
- Historic Star Mill owner sells property;...
- Salt Lake police warn of vinyl fence vandals
- Alleged mastermind in sex trafficking ring...
- Photos: Olympian Noelle Pikus-Pace speaks to...
- South Jordan mayor says idea to split Jordan...
- Judge: Biological father will share... 31
- The story of a fish, a river and what's... 26
- Local religious leaders urge support... 25
- Cities, state battle panhandling... 24
- New BYU president: Kevin Worthen to... 21
- Utah unemployment rate hits five-year low 18
- Dog lovers walk to support anti-bias... 14
- No money for House Speaker Becky... 13