The High Cost of Educatioon and the Reality of Job Prospects

Most people that earned a college degree will never say that they wish they had not achieved that accomplishment. However, with the recent downturn in the economy, there is a lack of jobs out there and student loans are leaving new graduates saddled with large sums of student loan debt and without any job prospects that lead to gainful employment. Recently, student loan debt in the US has exceeded all of the credit card debt in the entire country. In addition, student loan default rates are at an all time high.

Receiving an education is often times far better than not. The rising cost of education is making some students and their parents question whether or not the high price tag is a wise investment. Earning a degree used to almost certainly mean that a graduate could get a meaningful job or at least earn a living wage. According to a recent survey by, of 2 million recent college grads under the age of 25, only 700,000 have jobs currently and most of them did not require a degree in the first place. Many recent grads have to take multiple low-skilled part-time jobs if and when they can even find them.

Typically, 6 months after graduation the student loans come due whether or not the student has a job. This is especially problematic because student loans are not forgivable during bankruptcy and the lenders will eventually garnish wages regardless of the financial position of the student. The push to the top in education and low test scores and achievement seem contradictory. While the Obama administration wants to put as many degrees into the hands of Americans as is possible, the job prospects and the actual knowledge gained in terms of achievement have been frequently ignored.

In addition, many 529 college tuition savings programs are turning around less than desirable results. Contrary to popular belief, many of these investment programs are not backed by the state and returns on the investments are not guaranteed as some of these non-profit investment programs would have you believe. Another falsehood is that they can “lock in” tuition rates at various institutions. These programs, in fact, have no way of controlling current or future rates at any academic institution. Buyer beware that what seems like the best decision for your children might actually lead to a huge disappointment in the future. Do your homework and don’t trust any investment program that claims to be backed by the state or resistant to regular market conditions.