America is a nation mired in debt. The federal government is so far in debt we may never see a balanced budget again. Most of the 50 states are so debt-ridden they have to borrow money to pay their on-going obligations such as state retirements. Finally, individual Americans are drowning in debt. Most Americans owe on their cars, owe on their houses, and owe on their credit cards. In fact, the average credit card debt for American citizens is now $15, 159 and growing. But credit card debt is nothing when compared to student loan debt. The average student loan debt is now $35,200 and growing. But student loan debts exceeding $100,000 are not uncommon. To make matters worse, most students who graduate owing on a large student loan also carry a heavy burden of credit card debt on top of it. Things have gotten so out of hand with student loans that I predict the next major crack in our economy will come from college students defaulting on their government guaranteed student loans.
According to World’s November 2, 2013 edition, “Student loan debt now outstrips car loan debt and even outstanding U.S. credit card spending—growing from 12 percent in 2004 to 35 percent in 2013 of all non-housing debt. Worse, as the cost of college tuition and the cost of borrowing to pay for it have skyrocketed, income levels and employment levels have flat-lined. It’s perhaps then no surprise that nearly 40 percent of federal student loans are delinquent—as it becomes a longer and steeper climb for most college graduates to pay off bigger and bigger loans…Total federal student loan debt has increased by 95 percent in just six years, from $516 BILLION in 2007 to 1.007 TRILLION dollars in 2013. Average costs for tuition, room, board at U.S. institutions have increased by 12 percent since 2007, after adjusting for inflation.”
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