Can Older Generations Relate to Current Generations Regarding Student Loan Debt?
Who doesn’t love an honest heart to heart conversation? Over the weekend we didn’t intentionally seek out this particular conversation, but we asked some older generations their thoughts on the student loan crisis.
Over the weekend we took a trip to Chincoteague (Virginia) and Assateague (Maryland) and stayed in a traditional bed and breakfast in a small town named, Onancock, VA. We might be your atypical younger couple who actually enjoy staying at authentic bed and breakfast places (not Airbnbs, although we’ve enjoyed staying at a few of these as well). I mean, who wouldn’t? Oftentimes, these BnB’s serve some phenomenal food and some even have quite the historical background.
In most cases, we are the youngest guests at some of these places. This was particularly true while in Onancock. For those that haven’t stayed at traditional bed and breakfast places, typically you join all the other guests each morning for breakfast prepared by the BnB owner/host. During this time, you get to meet all types of people from many different walks of life.
Small Talk Leads to Big Conversation
Generally, conversations begin with small talk. Once the small talk passes, usually more in depth conversations arise. Once we tell folks about our full-time RV travels, usually several follow up questions arise asking for more details. The most frequent question we receive is ‘why’? This one is easy to answer because it’s mostly related to our student loan debt and it’s massive weight on our shoulders. Now if we were around similar folks our age, most would completely understand our decision and could relate. Even though these generations might not be able to directly relate, everyone agreed that we have a student loan crisis.
Most of these folks were early 50s to late 70s. The early 50s couple expressed concerns to our Nations student loan debt and the toll it takes on younger generations. They also mentioned significant improvements employers’ could make to help ease this burden upon being hired, which included an employer based repayment benefit.
Which Employers Currently Offer Student Loan Repayment Benefits?
That is absolutely a huge benefit employers should consider offering, especially since many may not provide retirement matching plans. According to US News Employers Offering Student Loan Repayment Benefits, there’s a handful of employers currently offering student loan repayment options. These employers include:
- Estée Lauder
- Fidelity Investments
- First Republic Bank
- Penguin Random House
How Does It Work?
Usually employers will offer a set amount either each month or for the year. This is comparable to employer retirement plans which could be matching or a flat rate contribution. Although many offer this as a benefit, often employees have to meet certain eligibility requirements to be approved. Again, some of these requirements are similarly to becoming ‘vested’ into the company’s’ retirement plan(s).
What about the late 70s couple…What was their Opinions?
This generation we believed to be the one least likely to relate or understand what our generation is going through related to student loan debt. This was confirmed shortly after this statement was made, “back in our day, you mostly went to college because it was something to do”. Statistically speaking, the numbers show the staggering difference in college graduates in 1959 vs 2002. In 1959, only 16.3% graduated from a 4 year college. In contrast, 53.6% graduated with a 4 year degree in 2002. College Graduates by year and gender.
Undeniably, those who attended college back in the 50s and 60s wouldn’t necessarily relate to the college attendees today. Different times, different costs, and different objectives. College went from something you did, to something you must. Especially if you wish to earn a consistent income.
What Did Tuition Cost?
In 1959, a public 4 year college tuition cost $810 total, additionally, a private 4 year college tuition cost $1,510. 1959 College Tuition Rates. Obviously, it’s hard to make a dollar to dollar comparison due to the cost of living being significantly different in these two eras, but for insight to cost vs debt, I included those amounts. In 2002, public college tuition was $9,670 to private college tuition totaling $24,870. 2002 College Tuition Rates.
It shouldn’t come as any surprise based on the numbers why the late 70s couple cannot relate. $1500 total vs over $40k today. Additionally, an argument could be made that the requirement to attend college back in the 50s/60s was non-existent while in the 2000s it’s become more than a requirement and usually considered mandatory.
Truthfully, the numbers don’t lie. We have a student loan crisis at the result of a college tuition problem.
Student Loan Debt is Debilitating
Exactly how we feel. Back in 2005, I borrowed a very high interest rate ‘student loan’ for my bachelor’s degree. This loan was for $10,000 which was to cover some of the tuition and books while I worked full-time to cover the other necessary costs. After 10 years of consistently paying almost nothing but interest, I had gotten the total down to $6500. By this time, I had also paid in more than $8k in interest. Talk about running in the same spot and never getting anywhere. 10 years and having only paid $3500 of the principal balance.
My wife would tell you her debt feels like a ball and chain just heavy enough to weigh you down, but allows you to keep swimming in circles. We were fortunate when she decided to pursue her Doctorate in Advanced Nursing Practice. We had my income which was fairly decent and decided to live in a nice 1 bedroom apartment during this three year tenure. This helped save on some expenses and provided us income for life’s other necessities.
Her student loan debt did surpass the $100k mark and the payment was equal to that of a small house or apartment. The interest accrued, the small amount that touched the principal balance, and the overwhelming feeling that it was a never ending cycle led to our creative decision.