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I recently watched my student loan climb for the fourth of five (I cut one off!) times during my MBA program. It is a little disheartening and overwhelming to see my Stafford Loan balances climb. My total student loan debt today is $15,981. However, had I not been paying the loans aggressively while in school, my loans would total well over $27,000.
The average student today is leaving school with some form of debt. In the US, about two thirds of undergraduates leave college with debt. The average senior has $23,186 excluding federal PLUS loans at graduation. Masters degree students tack on an additional $25,000 in student debt on average. Looking for a PhD? Expect another $52,000.
At 6.8% (the federal student loan rate) over 10 years, the average student loan payments from grad school alone is $287 per month. If you are just rolling over the average undergrad and graduate student loans into one monthly payment, plan on $554 per month. I hope you get a good job if you are in that situation.
Student loan debt is a growing problem in the US and around the world. Fortunately for grads with large debt, most lenders will allow for deferred payments and graduated payments if you are struggling. You just need to ask. However, people are not planning ahead when they are taking on student debt. It might be easier now to take an extra $6000 per year to help with school, but is it better in the long run?
Many students would have lived a less lavish lifestyle in college had they realized what their student loans were going to do. It is almost as bad for students with credit card debt, though the upcoming law changes will end most of that.
I know a lot of the readers of this blog are either in school or are recent graduates. How are you all dealing with student loan debt? Are you paying the minimum? Are you paying more? Are you struggling to just keep the loan current? Let us know in the comments, maybe a few of us have some ideas for how to deal with it.
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