
The Number of Older Student Loan Borrowers Is Rising - JumpCrisscross
https://mobile.nytimes.com/2017/01/11/business/number-of-older-student-loan-borrowers-is-rising.html?em_pos=small&emc=edit_dk_20170112&nl=dealbook&nl_art=21&nlid=65508833&ref=headline&te=1&referer=
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tabeth
Has there been any attempt to orchestrate an income based repayment program?
This could be implemented in a variety of ways, the most popular of which is
taking a percentage of your income after graduating.

Some advantages I can think of:

1\. Educational quality is more tied to student success.

2\. The burden of "payment" is shifted from the student to the school, as the
school now must make sure their students are capable of getting good jobs if
they want to be paid themselves.

3\. Education and corporate "curricula" are more coupled. This could also be a
disadvantage, depending on how you think about it.

Some diadvantages:

1\. This hurts liberal arts, where the value is more opaque.

2\. Research based, or generally any profession that's intellectually
difficult, but pays low will be discouraged, implicitly through this.

3\. Makes the point of education a bit more professional and practical, which
may have longer term effects (people who think outside of the box generally
aren't the ones who are paid well, initially).

~~~
Meegul
My school, Purdue University, has been making a big push towards IBR. The
biggest issue with it I can see, is that, as far as I can tell, there's no cap
on the money collected. That is to say, if they take 15% of your income, and
you end up making lots of money, they will continue collecting their share
past the actual cost of college. It honestly makes me feel like they see me as
an indentured servant, not a student.

~~~
whorleater
On the other hand, if the cost of a college is "flexible" as in a % of your
income, doesn't it just end up in a situation in which higher-paid graduates
subsidize the cost of college for lower-paid graduates?

~~~
Meegul
I believe that's the entire idea of it. That and then the college could
selectively decide how many majors of a certain type they need, financially
speaking. A college will then be punished financially for pushing out tons of
gender studies grads rather than engineers.

~~~
mywittyname
Or water down their engineering program in order to push out more graduates.

~~~
thmsths
But since education is a market this would lower the reputation of the college
thus attracting less candidates and if they lower the requirements too much
they may even loose their accreditations.

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wtvanhest
Slightly off topic, but does anyone know how/have experience getting a
california bill put on the ballot?

One area that I believe is highly inequitable is that home owners can write
off all of their interest on their home loan, but there are income caps for
student loans that restrict who and how much interest can be written off.

I'd like to draft a measure to make student loan interest 100% tax deductable
at the state level. The hope is that passing it in CA would create a
conversation around federal income tax policy and student loan interest.

~~~
jartelt
Then, as someone who is a renter and does not have student loans, I would miss
out on two tax breaks. I think a more elegant solution is to get rid of
interest deductions for home owners. When you take out a loan, I think you
should pay the real price for that loan.

~~~
wtvanhest
Just out of curiosity, did you attend school? If so, how exactly did you pay
for it?

~~~
jartelt
I got BS from a public school. I paid for school via a mix of working ~10
hours a week throughout the school year, applying for local scholarships,
doing a paid internship every summer, living in a cheap apartment, and then
getting some loans. Since my tuition was only ~$10,000 a year and I graduated
in 4 years, the overall amount of loans needed were not huge and could be paid
off relatively quickly.

~~~
wtvanhest
I did a similar thing for undergrad and graduated with no debt. After working
a few years went back for a grad degree which is how I accumulated some grad
debt. Luckily I am doing fine and will have it paid off relatively quickly. My
issue is more with the structural disadvantages we are creating for others and
I think creating a system that is fair for both types of borrowers, home loan
borrowers and student loan borrowers makes sense.

I would even consider allowing the write-off of discretionary interest like
car loan interest. It should likely be capped at some value that allows people
to buy a new, but not ridiculous car. (I don't own a car so this is especially
not something I care about).

Point is, if home buyers are writing off their interest, people who are
investing in themselves definitely should. I also agree with your elegant
solution, and would support no write-offs, but I believe it is harder to take
away write-offs than to add them.

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hackuser
The idea that necessary education is 12 years goes back a century, AFAIK.
Perhaps it's time that we extend that to 16 years (I'm not the first to say
it) and stop making it an issue of ability to pay. Certainly the job market
values college degrees much more than high school diplomas; an economy full of
more productive workers will make the tide rise for all the boats - people
selling to those workers, hiring them, those workers' kids, etc etc.

That doesn't solve the abysmal K-12 education so many people receive, of
course.

~~~
paulddraper
> The idea that necessary education is 12 years goes back a century

So previously it was 6 years, and you want to make it 16?

IMO, the opposite should happen. Germany got this pretty right.
[https://upload.wikimedia.org/wikipedia/commons/thumb/0/0e/Ge...](https://upload.wikimedia.org/wikipedia/commons/thumb/0/0e/German_School_system.svg/500px-
German_School_system.svg.png)

There are far more varied education routes, it means not everyone takes $100ks
of loans when they really just need a couple years of trade school.

~~~
neuland
I like Germany's system of education, granted I went to a Gymnasium for a
year, which seems like it's a better deal insofar as it sets you up for higher
wage jobs.

But to push back a bit, the sorting process in 4th grade is incredibly unfair,
especially to students with uneven learning (ie. are "behind" in 4th grade and
thus are destined to be a low wage worker for their whole lives) or are
immigrants.

And what's worse, well-off families can work around the system by pushing back
if their child is "sorted" into Realschule or Hauptschule. Or, they can just
opt to send them to private school instead.

So, it's not all roses. But outside tracking (which will never be a perfectly
efficient), I think it is fundamentally a better than the U.S.'s education
system.

Some people don't need to and shouldn't go to college. And, it's great if they
can get an education that's tailored to them.

~~~
hackuser
> Some people don't need to and shouldn't go to college.

Who are these people? Who decides? Have you asked them? What if they want to
go to college? Is college only valuable for work skills? What about
understanding the world?

I wonder if people said the same about high school, and basic literacy.

EDIT: I'll add to people reading this: Did you go to college? Do you expect
your kids to? What about Senators, CEOs, etc - will their kids go to college?
Much of this is the elite telling everyone else that their families don't need
to go to college.

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memset
For more details, here is a link to the original report written by the CFPB:
[https://s3.amazonaws.com/files.consumerfinance.gov/f/documen...](https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/201701_cfpb_OA-
Student-Loan-Snapshot.pdf)

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lend000
It's quite a concept that easier student loan debt would create more of it.

Perhaps a better system would have kids starting internships 4 years earlier
(i.e. high school) and having the flexibility and context to specialize in a
path earlier. And if their career didn't have much use for a degree? Save the
time and money. I had learned far more from working/independent
reading/independent projects/the Internet in general than in my formal
engineering classes by the time I had graduated. Two or three classes stuck
out as having a comparable impact as my internships and other ventures, but in
reality it's kind of a net waste. I'm more academically inclined than a lot of
people, so that really speaks to how important this point is regarding those
who grow up not liking academics in the first place.

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ronnier
> Americans age 60 and older are the fastest-growing group of student loan
> borrowers.

There it is. The "fastest-growing".
[https://xkcd.com/1102/](https://xkcd.com/1102/)

I wonder if people beyond their 20's are going back to college in hopes of
meeting a mate?

~~~
wutbrodo
> I wonder if people beyond their 20's are going back to college in hopes of
> meeting a mate?

If you read the linked article, it's about taking on debt for kids/grandkids
or repaying debt incurred when they were young. There's nothing in there about
a change in the trend of older people going back to school.

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dogismycopilot
"Some older borrowers are carrying their own student loans, but most have
education debt taken out on behalf of their children or grandchildren, either
by borrowing the money themselves or co-signing loans with the student as the
main borrower, the report found."

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whyileft
More usury in the one of the most immoral societies in the world. Where it is
perfectly legal to create terms of a contract where an elderly person can be
pushed into crippling poverty if they are unable to pay.

~~~
nkrisc
Immoral by what measure?

~~~
rm_-rf_slash
Where to begin? Land stolen through genocide and worked by slaves? Mass
incarceration? Instigation of coups in foreign governments to ensure lower
consumer costs and higher profits at home? Unaccountable drone strikes of
innocent people in several countries, including countries we aren't at war
with like Yemen?

Our society is very sick. It has been for a long time.

~~~
linkregister
If we get to reach back into history for atrocities to describe current
societal ills, then we effectively mar most of the world's nations:
practically all of Europe, most of East and South Asia, the Middle East, North
and Central Africa.

Then the metric ceases to be meaningful.

~~~
rm_-rf_slash
So other people are just as bad and somehow that makes it better? Is that
really the best that we can do?

~~~
linkregister
Were bad != are bad now

I am no moral relativist when it comes to civilizations: some are more humane
than others.

On the other hand, how is it fair to judge a person or persons based off of
their ancestors' actions?

------
caseysoftware
The cynic in me says "well yes, odds are they have more assets in case they
default.."

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codeddesign
There are multiple issues at play here, but it all comes down to mis-
management of available funds.

1\. Parent's (or grandparents) and student's not appropriately preparing for
debt that a student will incur. If you know there is going to be a large debt
in the future, stop buying and save. No one need's x-mas presents, no one
need's that $30k car, no one need's to go on vacation. We as a culture are in
the habit of spending and then complaining about our college debt.

2\. Paying for college tuitions that we really don't need. If you don't have
the available fund's to pay $20k a year for your undergrad, then don't. Go to
a community college and pay 1/3 of the cost. Or better yet, take half the
classes, live at home, create a budget, and pay for your school (or at least
books) as you go. I have never heard of anyone being turned down for a job
because of their undergrad being from a no-name college. Usually it's because
the students want the "college experience" and then have to reap the cost of
it later.

3\. Mis-management of available fund's after college. College debt is debt. It
may be a little more flexible than a credit card, but debt is debt. Live in
the smallest house you can find, buy older cars, no vacations, no eating out.
Pay off the debt that you agreed to, and then move on. I've seen too many
people buying large homes, new vehicles, buying junk, and then complaining
that they still have student debt.

4\. Only go to college for a purpose, not because you feel the "need" to. Stop
going to college just to go. Go to college with a purpose that will impact
your life later in your years. So many people begin college no knowing at all
what they want to do, change majors, and end up doing nothing related to their
education.

5\. Spend on your degree based upon your expected return. If you are getting
your degree in liberal arts, do not spend $80k on your degree - you will not
receive a balanced return on your investment.

Now, this article really has to do with parents and grandparent's co-signing
for students and how the parents/grandparents are now on the hook for this
debt. If there were required curriculums in high schools on how to manage
money and how to manage debt, a lot of these types of articles would
disappear. Or better yet, if people were not allowed credit until their
student loans were paid.

Some just can't afford to pay off loan's quickly, and I feel for them. But if
you are making $70k a year and cannot pay off your loans, you are mismanaging
your money.

In regard's to the elderly in this article that are on the hook for this
student debt, I have no remorse. They have lived long enough to understand
money management and debt. If they allowed their grandchildren free access to
debt using their credit, then they should either have a plan in place for
repayment or been willing to bankroll the debt themselves.

~~~
wutbrodo
> I have never heard of anyone being turned down for a job because of their
> undergrad being from a no-name college.

Have you really never come across this? My anecdota are the exact opposite. In
every hiring process that I've been familiar with (granted, that's only
like...3), you'd have a non-trivial advantage at getting your foot in the door
if you have a good name on your resume. By the time you get to interviews,
nobody really cares, but the recruiters in pretty much every organization I've
been exposed to use extremely blunt filters like that.

~~~
popobobo
Yeah, I literally laughed when I saw this. I worked at Goldman Ball Sachs for
a little while. Tell you what, you will get discriminated by management if you
don't have ivy on your resume. I have had a md talking straight to my face
that he thinks I am lucky to get this job because the people around me all
graduated with a phd from Havard, Princeton and Yale. I don't even give a
shit.

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magic_beans
Ever heard of the Parent PLUS loan?

Yeah. That's why.

~~~
mywittyname
This is even worse than traditional student loans, because it parents feel
like crap for not "helping" their children. When in reality, the fact that a
student needs a PLUS loan should be an indicator that their chosen college is
too expensive.

Eliminate Parent Plus loans. Then require colleges to guarantee to a student,
before they start, that they can graduate from the program on time for the
maximum amount of student loans they will be granted. This prevents students
from going to an expensive university and ending up in a financial bind two
years in.

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fcsuper
This is good in a way. People with outdated skills are getting new training,
as long as they are able to avoid schools with poor career performance.

~~~
pricechild
From the article:

    
    
      most have education debt taken out on behalf of their children or grandchildren

