The student loan burden is a persistent problem in contemporary society. Despite significant efforts of the government, it continues to impact the economic and social life of the individuals. The following paper argues that the government should do more to relieve the student loan burden, which, in turn, would contribute to financial stability and, by extension, improved quality of life.
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First, it is necessary to acknowledge the fact that student loans create several difficulties for the students who participate in the program as well as for the economy of the state. According to the estimates, the total student loan debt has recently surpassed a one trillion milestone and continues growing (Vedder). The size of an average loan, currently estimated at $27,000, may require a decade or several decades to repay, which, understandably, has profound implications on the individual’s paying capacity (Maloney). Some experts suggest that the existence of the debt prevents the students from spending on goods and services and, by extension, stimulating economic development. In other words, relieving student loans would contribute to a more favorable economic environment. Admittedly, one of the most popular scenarios, referred to as loan forgiveness, raises the question of the coverage of existing debt, which can have massive complications on a macroeconomic level. Thus, the government should seek less disruptive options that would provide the necessary relief.
It should also be mentioned that, according to my experience, the financial burden described above hurts the quality of life of the impacted students. The most evident link is between the low purchasing power and the satisfaction of basic needs. Simply put, the students who struggle to repay their debt, especially those from low-income families, may be unable to gain access to essential products and services. One of the brighter examples is purchasing a house – an undertaking that requires equally significant capital and time frame. Similarly, student loan repayment disrupts the possibility to save for retirement. Finally, and, perhaps, most importantly, it discourages young individuals from creating families by undermining their financial stability early in life (Carey). As a result, the students remain financially stranded, which compromises the social component of their lives and ultimately hurts the entire community.
At this point, it should be acknowledged that certain steps are being made to relieve student loan debt. However, in their current form, they only partially address the problem. For instance, public service loan forgiveness allows students who work in the public sector to receive forgiveness after making 120 payments. However, it should be pointed out that such an option is only suitable for a fraction of the population impacted by the issue (Garber). It can be argued that the program severely limits employment opportunities for the students who intend to benefit from it. Another notable issue is the rigidity of the criteria that determine students’ eligibility for the program. Also, the duration of the program introduces an additional risk of failing to comply in the process. As can be seen, the effectiveness of the program in its current state is insufficient for meeting the needs of the majority of participants and requires additional effort on the part of the government to improve the situation.
Student loans are a complex socioeconomic issue. According to the available information, they have profound adverse effects on employment, financial stability, and, by extension, the social life of the impacted individuals. However, with additional effort on the part of the government, it is reasonable to expect an improvement of the issue at least in the long run.
Carey, Kevin. “The U.S. Should Adopt Income-Based Loans Now.” The Chronicle. 2011, Web.
Garber, Joathan. “There’s a Big Problem with the Government’s Offer to ‘Forgive’ Your Mountain of Student-Loan Debt.” Business Insider. 2015, Web.
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Maloney, Carolyn. “The Student Debt Crisis Solution.” Politico Magazine. 2015, Web.
Vedder, Richard. “Forgive Student Loans?” National Review. 2011, Web.