“In America, education is still the great equalizer,” Secretary Duncan told a group of graduates at Fayetteville State University’s Winter Commencement on Saturday. Duncan described the importance of education in today’s economy, and that education is, in the long run, one of the best investments one can make for the future.
On average, Americans who have earned a bachelor degree will earn roughly one million dollars more over their lifetime than students with only a high school diploma, Duncan explained.
Secretary Duncan noted that the Obama Administration is taking big steps to keep student debt manageable through the recently introduced Pay As You Earn proposal. For those who qualify, the proposal would cap monthly student loan payments to what people can afford. “In practical terms,” Duncan explained, “1.6 million Americans could literally see their loan payments go down by hundreds of dollars a month.”
“We want people to be able to follow their heart and passion—and not just chase a big paycheck because they have to pay back loans. America can’t afford to lose that talent,” Duncan said.
Click here to read more about the Pay As You Earn proposal.
Additional Resources:
- Find the right college for you with the National Center for Education Statistics’ College Navigator.
- Click here to visit ED’s College Affordability and Transparency Center for information about tuition and net prices at postsecondary institutions.
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As a financial aid professional, I try to encourage conservative use of loans, but from the student’s point of view, with Income Based Repayment (IBR), in school deferment and Cost of Attendance in place (which allows students to borrow more for “living expenses” than for tuition and fees while taking one class at a time), why stop borrowing? Once you borrow above your ability to repay, why try to finish sooner when you can live on your refunds at taxpayer’s expense? Why take employability into account at all? The person who borrows within their means, finishes quickly and finds gainful employment will fully repay their loans, while the person who drags on their enrollment, lives off of their aid pursuing second and third degrees (which often do not increase employability) while taking one class at a time every other term gets a free ride from Uncle Sam when their loans are written off.
I have seen students with over $300,000 in loan debt, with 2/3 of it going in their pocket as refunds knowing full well they will never be able to fully pay it all off.
Limit funding to direct cost for less than full time and get rid of IBR or we will see another massive taxpayer bailout for the irresponsible.
I appreciate and support Pay As You Earn, and thank you for that. But I can’t resist pointing out that, as a teacher, I am expecting to make about $1.5 million over the course of my career – with an M.A.T. Not quite sure I’m getting that extra million I might have expected.