If you’re thinking about borrowing money to pay for college or your child is thinking about college and you know a loan is your only option for paying tuition, you aren’t alone.
More than half of all college students are using loans to pay for their tuition. And while there are many loan programs that make college possible, borrowing money to pay for tuition isn’t always the best option. As a matter of fact, many financial experts believe a debt crisis related to student loans is right around the corner. This is why it’s so important to understand what you are getting into before taking on a college loan.
What are a few of the most important things you need to know about college loan debt?
Loans Buy You a Degree, Not a Job
Attending college is a great opportunity for a lot of people, but a college degree doesn’t guarantee you a job. Many graduates struggle to find work after college and not only are they faced with the challenge of having no income, they also have tens of thousands of dollars in debt because of the money they borrowed to attend college.
Your best bet is to choose a career path that offers some security. Some of these options require a college degree, but in other cases, technical school and on-the-job training are enough to succeed.
Before taking on a loan to pay for college, consider your options and what you’ll do with your degree once you graduate. Is the degree you want worth the investment and will you be able to find a job once you graduate? College is a huge investment and more and more people are deciding that it’s not an expense worth their money.
You Don’t Have a Safety Net with Student Loans
Some people assume that taking on a great deal of student loan debt isn’t that big a commitment because they can discharge the debt by filing for bankruptcy if times get tough. After all, people do this when they get in over their heads with credit cards, right?
Unfortunately, most student loan debt is not dischargeable.
Even if you file for Chapter 7 bankruptcy – the option that erases a big chunk of unsecured debt – you’ll still be on the hook for your student loans. There are instances in which student loans can be discharged, but they are determined on a case by case basis and there are no guarantees. You’re better off avoiding the debt in the first place than you are assuming you’ll be able to get out from under it once it’s there.
Not to mention, you’ll have no recourse for student loan debt if you file for Chapter 13. In order to even have the possibility of having student loan debt discharged, you’ll need to give up complete control of your money and your assets by filing for Chapter 7.
To learn more about dischargeable and non-dischargeable debts in bankruptcy, check out this information.
Is Student Loan Debt Worth the Risk?
The answer to this question varies from person to person.
For some, especially those pursuing careers in science or technology, attending college and starting adult life with college debt can be worth it. To succeed in certain careers you have no choice but to attend college and many fields have a great job outlook and compensate professionals sufficiently.
However, there are people out there who chose career paths that don’t provide enough income to handle the amount of debt they’ve taken on to attend college.
The key is to look at the big picture and think about the future, as well as your current opportunities. Gone are the days where successful people are expected to go to college. You need to decide what’s best for you.
If you’d like more information or you need help dealing with student loan debt, we can help. Contact the Law Office of Robert M. Geller at 813.254.5696 to learn more or to schedule a consultation.