Here are the best articles from around the web this week talking about student loans…
For the week ending Friday August 30, 2013
Student Loan News:
1. Student loan rates will feed federal profits:
A law touted by politicians as their way of keeping money in the pockets of the nation's college students will instead funnel more than $700 million in additional profit into the federal government's wallet over the next 10 years, a new analysis shows.
The law, regulating interest rates for federal student loans, was passed by Congress and signed by President Barack Obama this summer. It was hailed by politicians on both sides of the aisle as a win in the campaign to combat a rising tide of student loan indebtedness. Details here: http://www.usatoday.com/story/news/nation/2013/08/25/student-loan-rates-will-feed-fed-profits/2696241/
2. Limit Student Loans to Increase Chances of Start-up Success:
The Student Loan Ranger has written before about how student loans may be prolonging the recession and the New York Times and others have opined that it may be a drag on the economy. Recently the Wall Street Journal reporter Ruth Simon dug deeper to explore how student loans are specifically affecting entrepreneurs.
Not surprisingly, the article illustrates that the impact is both negative and considerable, especially because a disproportionate number of disruptive startups have been founded by recent graduates and dropouts. Read more: http://www.usnews.com/education/blogs/student-loan-ranger/2013/08/28/limit-student-loans-to-increase-chances-of-startup-success
3. Parents face the student loan double whammy:
At age 51, Charlene Rose had hoped to be socking away money for retirement by now. But instead, she's still paying off her student loans, largely for a master's degree she got to advance her career. And now she's got three kids in college, each of whom is taking out student loans of their own to pay for higher education.
Together, Rose and her children owe as much as $136,000 in student loans. “I didn't think I would have this much debt,” Rose said. But she thinks it's important for her children to get college degrees, even though her student loan debt could affect her ability to retire. Full article here: http://www.cnbc.com/id/100984688
Student Loan Blog Posts:
1. Obama Announces Plan to Forgive All Student Loans:
President Obama announced a plan today to forgive 100 percent of all federal student loans in the country.
In a speech in Scranton, PA the president told an assembled crowd that it was unfair to hold college graduates to promises they made as students and outlined his vision for ending all student loan payments by the end of the year. Find out more: http://dailycurrant.com/2013/08/22/obama-announces-plan-to-forgive-all-student-loans/
2. Congress’ new student loan plan contingent on the market:
Congress recently approved a plan that will amend the federal student loan interest rates from a fixed percentage to a rate that fluctuates with the market.
The approved plan, the Bipartisan Student Loan Certainty Act of 2013, took effect on July 1. This came after Congress failed to reach an agreement to extend the 3.4 percent interest rate previously instated. As a result, the rates doubled from 3.4 to 6.8 percent before the new bipartisan deal was approved. Browse more: http://sundial.csun.edu/2013/08/congress-new-student-loan-plan-contingent-on-the-market/
3. Students react to new loan legislation:
For a student that graduated from USC in 1987, the year a gallon of gas cost 89 cents, monthly rent cost $395, and the cost of tuition and fees at USC was $10,564 for an entire year. A student attending USC in 2013 paid a price almost four times higher: $43,722
Even though Congress passed a rate reduction for unsubsidized Stafford loans last year, this year’s legislation reduces rates for all federal student loans. Eighty percent of students who are on subsidized loans are also being loaned unsubsidized funds. Click here: http://dailytrojan.com/2013/08/27/students-react-to-new-loan-legislation/