In response to Mr. Burroughs’ September 1stst letter suggesting that President Biden is trying to “buy” votes via the executive order canceling $10,000 in student loan debt and $20,000 for those with Pell student loans, I suggest he consider the following points.
I’ll start by saying that I have no idea how old Mr. Burroughs was and/or when he attended college and paid off his student loans. I know the numbers for me (1978 State University of New York graduate) and my son (2012 private college graduate in Florida) were a real eye-opener on the cost of college. And yes Mr. Burroughs, we both paid off our student loans.
Based on data from educationdata.org (using figures for the period 1975-1981 and 2021), the average price per year of tuition, fees and room and board has increased from $1,386 at $2,927 to $21,337 for a public college and from $3,669 to $5,594 to $46,331 for a private college.
This website also notes that today’s average student borrower takes 20 years to pay off their student debt, with some professional graduates taking over 45 years to pay off their student loans. It’s also worth noting that 21% of borrowers see their total student debt balance increase in the first five years of their loan. With these numbers in mind, canceling the $10,000 or $20,000 debt, while a big help, is not the end of a graduate’s commitment to repay. his loan. Many graduates are unable to find employment and those who do are often underemployed. June 2020 data from the Federal Reserve Bank of New York shows that 39% of recent college graduates are underemployed.
After graduation, it’s time to find accommodation and begin the next phase of post-graduate life. Renting an apartment is now a new expense. According to ipropertymanagement.com, average rental prices have increased at a rate of 8.86% per year since 1980, consistently outpacing wage inflation by a significant margin, with 2021 seeing the highest rental increase on record. The national average monthly rent in 2020 was $1,164, with 28.4% as the average rent-to-income ratio for tenants.
Looking at auto loans (because recent college grads need transportation to get to their new jobs), Kelley Blue Book reports that in September 2021, the average price of new cars in the U.S. was $45,031, marking the first time in history that the average trade price has crossed the $45,000 mark. A report of CarBuzz fNearly five years ago, the average price of new cars was then $34,077, or 12.6% more than the value five years earlier.
Considering just these three expenses when college graduates enter the workforce, having help adjusting to life after college with some of their student loans forgiven is essential. . In reference to Mr. Burroughs’ comment on Robin Hood, I believe helping the poor (or new college graduates with growing financial commitments) would be something Robin would be happy with.
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