Student Loan Debt

Student Loan Debt - A Necessary Evil?

Student loans are a must for many college attendees. Without them they would have to give up their educational plans or take years to complete their programs by working full time and attending school in the evenings. Statistics show that about 50% of college graduates take advantage of government programs and their student loan debt averages $10,000 by the time they graduate. Unfortunately college fees are on a steady increase and many programs will no longer take a student all the way through. The average cost of a public college education is now $13,000 per year and going to a private school will set you back $28,000 annually.


Some of the financial aid choices are grants, federal loans, scholarships, and private loans. The most commonly used category is that of federal loans. Right now is an excellent time to accrue or pay student loan debt as interest rates are so low. The government allows your lending institution to give you a 6-month grace period before you start repaying the loan. This is to give you time to find a good job hopefully using your new degree. You will then have 10 years to pay the loan off. Often you will have more than one outstanding loan, so it's a good idea to consolidate them. That way you'll be making only one payment at the best rate you can find and be able to keep track easily of where you are in your repayment schedule.

Medical Student Loans

The area of medical student loan debt is a different story. For one thing, getting through medical school costs in the neighborhood of $100,000. We tend to think of doctors as making big money, however this isn't always true, and definitely not in the first years of practice. In the past 20 years the cost of medical school has increased by a whopping 312% in public colleges. This rise is faster than the national rate of inflation, and coupled with the slow rise in medical pay, it's a difficult situation for young doctors.


A piece of solid advice for those with student loan debt is to not get into a default situation. If you find yourself having difficulty making your payments, contact your lender immediately. They will usually be glad to work with you but if you just stop paying you could be in real trouble. You can be sued for the entire amount of the loan and all associated collection fees, due immediately. You will ruin your credit, may have your wages garnished, and may possibly even lose any tax refunds you have coming. Default is a serious situation and you will want to avoid it no matter what.

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