“In America, no one should go broke because they chose to go to college, President Barack Obama said in his State of the Union Address. However, with current loan interest being as much as 15 percent, it’s hard for students not to feel poor. You might be happy to know the government offers loan forgiveness, but 25 years is a long time to wait.”
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In America, no one should go broke because they chose to go to college, President Barack Obama said in his State of the Union Address.

However, with current loan interest being as much as 15 percent, it’s hard for students not to feel poor.

You might be happy to know the government offers loan forgiveness, but 25 years is a long time to wait.

Talk about a serious grudge.

But the president has a different idea, which may encourage more people to go to college and give current students a new vote of confidence.

Under the Student Aid and Fiscal Responsibility Act, loans given through the direct loan system would be forgiven after 20 years, and for a student who goes into a career public service, only 10 years.

A five year difference may not seem like much, but the maximum interest would also be reduced from 15 to 10 percent of the student’s discretionary income.

That seems like a pretty big deal.

Discretionary income is defined as any income 150 percent above the poverty line.

It’s probably safe to say that most students are below that. Lucky us.

College has never been cheap, and the costs of attending continue to grow each year.

They say on average a student graduates with at least a $20,000 debt. See, you’re getting more than just a diploma.

That being said, maybe the president’s plan is the right course of action after all.

The job market certainly doesn’t look too good at this point, which probably means a lot of students currently graduating will have a difficult time finding employment right away, delaying opportunities to pay off loans.

Employment opportunities are in even less abundance for those who have never been to college, and most of them have not gone because of the cost.

Finding a good job without a degree is nearly impossible these days, and Obama’s plan may now encourage those people to take a second look at higher education.

Sure, in the short run it may not look like much of a difference but the average college graduate earns $53,800.

If you take 15 percent of that, you are left with $45,730. At 10 percent you get $48,420.

Over 25 years, 15 percent adds up to $201,750 while 10 percent over 20 years is only $107,600.

That’s quite a difference.

Whether or not you care about the Student Aid and Fiscal Responsibility Act, we can at least agree that no one wants to spend more money on anything.

If we haven’t learned anything else from college, we’ve at least discovered that you most certainly can put a price on education, and it isn’t cheap.

Perhaps Obama is just being ambitious, but time will certainly tell.

Until then, don’t say that the government never gave you anything.

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