Student Loan Debt On Rise; What It Means

(Graph: NY Times)

As Congress threatens to cut federal funding, the New York Times reports that student loan debt just might top $1 trillion.

This news comes at the same time that the Huffington Post reports, “the FY 2011 continuing resolution (CR) released by the House on Tuesday… increases it for the Defense Department.”

The proposed cuts to federal student aid include a 15% cut to the Pell Grant Program proposed earlier this year. The program “has not been able to keep up with the staggering number of students who qualify for federal aid,” according to the Huffington Post’s Leah Finnegan.

“The proposed cut in the maximum Pell Grant will be the largest cut in student aid funding in the history of the Pell Grant program,” wrote financial aid expert Mark Kantrowitz on the Huffington Post.

The New York Times article puts numbers on the growing trend of student loans.

“Two-thirds of bachelor’s degree recipients graduated with debt in 2008, compared with less than half in 1993,” Tamar Lewin writes for the NY Times. “Last year, graduates who took out loans left college with an average of $24,000 in debt. Default rates are rising, especially among those who attended for-profit colleges.”

Larger amounts of student debt, and especially those that take a longer time to be paid off, have lasting implications on society.

“As the transition from adolescence to adulthood is being delayed, with young people taking longer to marry, buy a home and have children, large student loans can slow the process further,” Lewin writes.

Will you be able to continue going to school if you have to take out more loans? There really isn’t much choice, is there? How do you see these cuts affecting you in both the short and long term?

At least Miranda Cosgrove won’t have to worry about student loans.

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