Alcohol and dorm room damages are part of a “hidden college costs” list. Student loan interest? Not so much. [Student Loan Network]
Pell grants on the chopping block in Congress. Your $5,500 grant just became a loan! [Kansas City Star]
What colleges offer the best return on investment? Hint: the top 18 are all public. The 19th? Princeton. My alma mater? Not on the list. [SmartMoney]
Ninth Circuit Court of Appeals court reinstates False Claims Act lawsuit against Corinthian Colleges. [Inside Higher Ed]
Go to a public university in a fly-over state they said. Can’t be that expensive, right? Wrong. [LJWorld.com]
Remember when Villanova Law revealed that they juiced their LSAT and GPA scores? The ABA has come down hard: a public censure! How many law schools are planning to do the same now that they know the consequences? [Above the Law]
Grad students: Say “bye, bye” to subsidized Stafford loans! While Congress was busy in early August figuring out if they’d pay back the money they already spent, they managed to stick a provision in the debt ceiling bill that kills the subsidies on Stafford loans for all graduate students. The Chronicle of Higher Education elaborates:
Interest will now accrue on all federal loans to graduate students instead of on two-thirds of those loans. The availability of loans won’t be affected. The issue is that when borrowers leave school, unless they have paid interest while in school, students will owe more than they otherwise would have. A student who borrowed the 2009-10 averaged subsidized amount of $7,171 at the beginning of each of two years of graduate school would owe about $15,838 instead of $14,342 based on 6.8% compounding interest. She would face monthly payments of $182 instead of $165 over a 10-year standard repayment period.
So, let’s do the math. Over ten years, students will pay $2,040 more in interest. And that’s just for two-year graduate programs. What about law students and med students?
Students who are in school for longer periods of time–including most medical and law students–will lose a bigger benefit. For those in shorter graduate programs, the subsidy matters less.
The government just raised every graduate student’s tuition a few thousand more dollars (in addition to the thousands that the schools will raise it next year). Of course, for law students and med students, $2,000 is a drop in the bucket compared to the overall cost of attendance.
*The figures in CHE’s story are inaccurate. For the 2009-10 academic year, graduate students took out $25.3 billion, not million, in Stafford loans.
The efforts to make college affordable to all and accessible to most have resulted in our enticing tens of millions of young people into assuming a destructive level of debt.
Peter Wood, “Investing in Debt,” Chronicle of Higher Education (Aug. 5, 2011).
Is it worth it to attend an expensive college or university? Even professors are coming to the conclusion that higher education sometimes isn’t worth its costs. Claudia Dreifus, a professor at Columbia University, and Andrew Hacker, a professor at Queens College in New York, recently published Higher Education? How Colleges Are Wasting Our Money and Failing Our Kids — And What We Can Do About It (book website). The number one reason to avoid an expensive education? Graduating debt-free is more important that graduating with an expensive diploma. Dreifus and Hacker elaborate in an article published in Readers Digest Magazine:
Don’t let your child go into debt for college. In 2010, almost two thirds of undergraduates borrowed money, and student-loan debt outpaced credit card debt for the first time. The College Board likes to say that a typical senior graduates with “only” $24,000 in debt, but with interest, collection charges, and penalties for postponed payments, the amounts owed can exceed $100,000. If you ever default on a federal student loan (and the rate of defaults is rising), you’ll be hounded for life. Lenders can garnish your wages, intercept your tax refunds, and have your professional license revoked. You can’t work for the government or collect your social security. “People have been sold this propaganda: ‘The rates are so low; just get a loan,’ ” Dreifus says. “The long-term effect is to cripple your children.”
Funny how that parade of horrors–creditors hounding graduates forever, having your professional license revoked, and being barred from working for the government–is never part of any college’s brochure.
Dreifus and Hacker offer other reasons not to attend, and many of them boil down to one fact: your tuition dollars fund everything but education. Highly paid professors and administrators. Money-sucking sports teams. Luxury living amenities. (The article already has more than 400 comments–clearly, this is a controversial issue.)
My alma mater was no different. The university touted its connections to a former president, a world-renowned religious leader, and a famous author in order to lure students to attend. The vast majority of students would never even have the opportunity take a class taught by one of these “professors.”
And the luxury amenities were over the top. Multiple swimming pools (indoor and outdoor), an enormous gym with a rock-climbing wall, dozens of tennis courts–in effect, a country club on a college campus. I lived better then than I have since. While colleges and universities need to compete for students, does it really make sense for them to compete on these grounds for money subsidized by the federal government?
Things need to change.
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