Here's my case in point:

I finished grad school in 1995 with about $70K in loan debt-- this was for 10 solid years of higher ed, mind you. I deferred payment for a couple of years because I had a post-doctoral research appointment that paid about $25K/yr. The loans were a mess at that point-- unconsolidated, with combined monthly payments approaching $1,500. I didn't have any clue who all the creditors were, where to send payments, etc. It took the financial aid departments of the universities I'd attended a while to gather all the info together, and even they were not successful in the end, but the situation did improve somewhat. By 1997 I was out of deferment, but there were still three loans to pay-- about $50K held by the Dept. of Ed, $25K that Sallie Mae had acquired from the original lenders, and (unknown at the time) about $5K that some lawyer in Los Angeles had purchased from the original lender (most of the original loans were for small amounts, and there were MANY of them, mostly small banks all over the country).

So in 1997 or thereabouts I began paying roughly $1,000 monthly on the two largest, now consolidated student loans, with total principle balance about $75K. I've had a couple, maybe three short deferments since then, generally three months of so, but not many. I've never missed a payment otherwise. In 2004 I changed to a lower monthly payment plan and reduced my payments to about $750 per month. You can do the math-- I've repaid several tens of thousands on those loans.

Today the combined principal balance is about $71K. In 15+ years of crippling monthly payments, the principle has declined by only about $4K. When I tell people this story they're incredulous. That cannot be right, they say. It is right, I'm afraid.

It gets worse, too. I'm only a few years away from retirement. Not only will I not work long enough to reduce the principle more than another one or two thousand dollars, I likely won't LIVE long enough to do much more than that, even if I work until the day I die. And remember that unknown $5K that some shyster lawyer in LA bought when the universities were trying to consolidate my loans? He was apparently one of the reasons that it took so long to consolidate, as he refused to do so. Eventually the loans were consolidated without him, and he just sat on his nest egg. A few months ago I got a notice that he'd received a $10K judgement for the unpaid loan plus interest, etc, and that my tax returns would be withheld to pay it off. Of course, that means I'll never see another tax return for the rest of my life, either, as the treadmill always runs faster than I can.

It's a life time trap unless your loan amount is very small and you have the means to pay it off quickly. For most of us, if that were the case we wouldn't need student loans to get an education in the first place, so in practical terms, for many it's a life time debt that can never be repaid.

I owe my soul to the company store.

I am not looking forward to the 25K or more I will be looking at when I finish...and believe me, If the economy is still in the sinkhole when I am done next year, I might just think about getting my Master's...at least then I can teach at the community college level... that's about all I can think of.

These loan sharks are really making a bundle off our debt if you think about it. And it doesn't surprise me in the least that the bankers are playing roulette with our interest ...that's what they do now. They don't actually MAKE anything, except misery...

In the early years, you pay mostly interest and very little principal. It will really start coming down in the last ten years of the loan. Your numbers are also completely off. The only way you could have a payment of nearly $1k/mo and still have a balance of 71k on a 75k loan 15 years later is if your interest rate is 16% on a 30 year ammortization.

I also have a 75k loan from business school. The interest rate is 6.9% and the ammortization is 25 years. I'm paying $530/mo and after 15 years, the balance will be around 45k, or 60% of the original balance.

...or at least they're not off by much-- I quoted them from memory though, so they're not exact. However, the principle balance IS still greater than $70K and and my payments ARE (currently) $750/mo, and were $1000/mo until 2004. And I still won't live long enough to pay this sucker off. My only hope is that if I make certain to send them something every month after I retire they'll huff and puff but not put me into default.

My understanding was that the interest rate was about 8%. I'll also admit that I find this situation so depressing that I have not inquired about it beyond checking my monthly statements occasionally.

to live long enough to pay it back. I did not realize that they were allowing me to borrow on the income of the two people who I was taking care of - my aging mother and my severely disabled daughter. If they had been considering MY income I would not have been able to borrow anywhere near what I ended up owing.

The young with college loans did not expect to run into this economy.

Plus I think that the lenders make more money off our debt than they do off our interest.

I don't know how long one can do it, but taking classes is one way to keep them from 'calling in their markers.' There's other ways to get a deferment too, like telling them you don't have a job yet, that you have other hardships, etc. It works as long as you stay in their good graces and don't disappear. If you sty in touch with the loan people, they won;t throw you into the pit of default. But once you are in default, you are screwed.

Personally, I had student loans from from my earlier years (mid-90's) and was able to defer until the early 200s...then they fell into default because of moving and I failed to stay in contact. It wasn't until last year with Pres Obama's new programs that I was able to rehabilitate the loan by making a minimal payment for six months straight. That allowed me to get back into school, and now I am FINALLY finishing my BA online. Unfortunately it means more debt, but what else is there to do? I hope beyond hope that the degree will help with job placement or at least make me more marketable, but in this economy who knows anymore...and I am no longer a spring chicken either.

While I can't speak for the up and coming generation. I *do* know that the debt factor effects ALL areas of life, from banking to housing to even getting a stupid credit card...

It's almost as if one would have to be a slash and burn vulture capitalist in order to pay off student debt.

Yes, taking classes will defer the payments. I understand if he cannot afford to pay them back right now, but this is a bad path forward. He should consolidate his loans and start paying them down.

He and his fiancee are struggling to even afford a halfway decent wedding and have cut all sorts of corners to make that happen. There is no way he can consolidate and begin to start paying down his loans right now. His car is on its last leg now and he needs a new one to get to and from work.

I just feel sorry for kids these days having to put up with this. When I went to college it was still affordable. I was able to pay as I went and that includes two masters degrees.

This couple can't afford a wedding yet they are going through with one anyway and jeopardizing their future in the process. They can still get married without shelling out big bucks for the wedding. Many past generations have had to prioritize when it comes to finances. Why should this one be any different?

This is my understanding - they are not shelling out big bucks for the wedding. They have prioritized. But life has to go on - doesn't it. If their present car has outlived their usefulness - in order for them to get to and from work to make money to pay down their student loans - they'll need to buy a car - probably a good, cheap, used car. Again they are prioritizing and doing it on the cheap.

One of the things my father always said to me that I remember - and he died when I was 11 y/o - was get a good education. I took that to heart and did - and it paid off for me. But that was when education was affordable and I was able to pay as I went to school and not incur any education related debt.

Nowadays if a person wants to get a good education - they have to go into debt that could potentially cripple them throughout their career - if I'm reading some of the posts right in this thread.

What's wrong with this picture? Weren't we supposed to make things better for our kids? Seems like we have failed in doing that.

I'm at the end of my career. I'll be retiring soon and making way for this generation of young adults to carry on and live their lives.

But from some of the posts here on this thread - it seems like there is no sympathy for this generation of young adults and they will just have to buckle under and sacrifice and do without.

I'm sorry - but that doesn't set well with me. It's no wonder that some of these young adults are just gaming the system or some are even giving up - because of the futility of the situation.

Even if they get a good education - the jobs just aren't there. The jobs that they take are less than they've studied and worked for. Not being paid enough to make a decent living wage. Raising the minimum wage falls on deaf ears. Corporations gaming the system so they don't have to pay well. (Wal-Mart anyone) Customer service is suffering - as employees just don't care anymore. Why should they care about your problems when they are saddled with so many of their own?

God - I just sit back here and say there are so many good things that can be done to get this country out of the hole that we're in - and nothing is moving. This Congress is the worst ever. The corporations don't care because they feel that they will have a constant stream of employees - if someone quits on them because they feel they are being treated badly - there are a number of people waiting in line to be abused next.

As I continue this thought I'm just getting more and more depressed. I'm stopping this right now.

at a small church, followed by a brunch at my mother's house.

The other sister, when it was her turn, eloped -- but her island wedding was also lovely.

That's one place I would cut corners if I were burdened by those kind of student loans. A marriage won't be hurt by having a smaller wedding, but it could be by that kind of debt.

all this college loan debt he realizes he may never be able to pay back and already alone will cripple him financially possibly for the rest of his life and he still continues to engage in the same failed living model like a blind automaton, buying cars, planning weddings, etc.

Your friend needs to scale his aspirations way back to ones more humble but managable and accept reality.

Living a champagne life on a beer budget.

This is going to sound really harsh, but if I knew them this is what I'd say.

They cannot afford whatever wedding it is they're wanting. The bells and whistles of a wedding are unnecessary expenditures. They can cut more. All they need to really be able to afford if they really want to be married is the marriage license and whatever the local JP charges. Car issues, I understand, important. Put that wedding money towards the vehicle, whether that's getting it fixed or buying a new/used car.

These are hard decisions, but what he's planning on doing is just plain stupid. Wedding you can't afford when your car is crapping out - stupid. Keep taking classes to defer his loans? Stupid. I actually wonder about what kind of education he's gotten, and I say this as also a current MBA student.

I understand the point about schools being expensive.

It took me 18 years to pay off 30K in debt, and I went to a state university for Grad School.

I have a friend who left the country and defaulted.

If it is, that's not a really good long-term financial strategy.

Yeah, student loans are a huge, huge problem that is only going to get worse. I think the underlying problem is that the borrowers, the students themselves are simply so young when they take on this debt that they just can't comprehend how bit it is going to be. Coupled of course with the fact that almost no one ever sits them down and says, NO! Don't do this! Don't borrow huge sums of money. Instead work and go to school part time. So what if it takes you longer, you will have much less debt in the end.

I keep on seeing justifications (including here on DU) why it's a better idea to take on tens of thousands of dollars of debt rather than not doing so, even for degrees that are clearly not going to lead to a good job.

My kids are in the mid-late twenties and have some SL debt. My step-daughter has around 30k and I think her hubby has around 50k. They are teachers now and I wonder how long it will take them to pay all that money back over the years.

I wonder, is the payback of having a college degree plus student loan debt outweigh the earning power of someone without a degree?

after they teach for a certain number of years. My husband was able to do that. It was specifically done to encourage people to go into teaching.

https://studentaid.ed.gov/repay-loans/forgiveness-cancellation/charts/teacher

Teacher Loan Forgiveness

The Teacher Loan Forgiveness Program is intended to encourage individuals to enter and continue in the teaching profession. Under this program, if you teach full-time for five complete and consecutive academic years in certain elementary and secondary schools and educational service agencies that serve low-income families, and meet other qualifications, you may be eligible for forgiveness of up to a combined total of $17,500 on your Direct Subsidized and Unsubsidized Loans and your Subsidized and Unsubsidized Federal Stafford Loans. If you have PLUS loans only, you are not eligible for this type of forgiveness.

SNIP

Teacher Cancellation

If you have a loan from the Federal Perkins Loan Program you might be eligible for loan cancellation for full-time teaching at a low-income school, or for teaching in certain subject areas. You can also qualify for deferment for these qualifying teaching services. Check with the school that made your Federal Perkins Loan for more information.

In the 60s, the only reason I took out loans was because I went to a more expensive private college. I graduated in 1968 with $2100 in debt. Postponed payment while in grad school (with TA and RA grants and husband's GI Bill benefits, and subsidized student housing, no more loans were necessary) with no interest accumulation. It was a government NDEA loan with 2% interest. Never paid more than $50/month, and finished paying it off in 1982.

I find it absolutely appalling what we are doing to Millenials.

Tuition and medical costs are rising fast. Meanwhile, salaries are NOT going up.

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I guess it's what profession one chooses.

In my area we have an excellent medical college, and I've known lots of people over the years who have graduated with big debt loads. Its not hard if you have gotten a degree in a good field to plan things out. It all comes down to whether you can work, and then how long it takes you to pay off your loans based on expected income. Most of the time it works out fine.

just because you don't have to pay it back, doesn't mean interest isn't accruing! He should just consolidate and ammortize over 30 years... the payment will be $330/mo. If he cannot swing that as an MBA, he's got much bigger problems in life.

An accredited institution has a license to print money - in the form of a degree.
That degree is a commodity that can be granted at whatever cost the market will bear.
That would seem to be free market capitalism but how do you start 'Joe and Ted's degree-granting institution?'
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Government accredits institutions.
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What if we were able to accredit people instead of institutions via comprehensive exams?
We do it with GED …
Students could take whatever preparation path they choose: self-study, tutors, volunteers and so on.
There would be no problem with 'Joe and Ted's computer lab' in this scenario.
It might open up some alternatives.
Clearly, something has to be done.
As a state college freshman in 1970, my tuition was $50 a semester.

Deferring won't do much good, especially if the interest accrues and gets added to the principal balance.

Quite honestly, $50K in debt is not that much for an MBA graduate. I had $130K when I graduated from law school.

6 units usually equals 2 full semester courses, although some single foreign language classes or science classes with labs can be 4 or 5 units.

thinks they can pay for it with student loans

I have encouraged then to go to Rutgers if they don't get scholarships.
The parents can pay off Rutgers cheaply as instate students and my mother and I had set up a fund for the boys for college when they were born (mostly Mom), so they will start off with a 40 K each, don't want them to blow it all on the first year in an expensive college. life is hard enough without starting in great debt.

But brother doesn't think like that and his wife (a Limbaugh fan apparently can't think clearly either)