How do people deal with their student debt?
Source: St. Louis Fed
Student debt is soaring. The cost of college is skyrocketing, but in our knowledge-based economy, education is more important than ever to financial success. Some people think a college degree is little more than signaling: the degree on your resume tells a prospective employer that you are intelligent and hard-working. But for someone looking for work, that’s beside the point. If you don’t have a diploma, many potential employers won’t even bother looking at your resume.
But a degree is incredibly expensive. The full cost for a BA at many private schools can be more than a quarter of a million dollars. And State Universities are expensive, too: four years at the University of New Hampshire costs more than $150 thousand for New Hampshire residents. It’s no wonder college debt is soaring.
So many students are resorting to the oldest profession to handle some of these newest financial pressures. The dating site SeekingArrangements.com is designed to connect “Sugar Babies” with “Sugar Daddies/Mommas.” In other words, young people are selling their bodies to help them pay off their student loans. The site claims to have 4.5 million active members, and lists a phone number with a Las Vegas area code (naturally) for press inquiries.
In the past, students would talk of working their way through college. With college costs out of control, we shouldn’t be surprised if being a “working student” takes on a whole new meaning.
Douglas R. Tengdin, CFA
Chief Investment Officer