Student loans leave less time to build wealth

Aarp

Student loans leave less time to build wealth"


Play all audios:

    

The rapidly rising costs of going to college are threatening the future retirement hopes of younger generations in ways their parents and grandparents never had to grapple with, according to


a new report from AARP. When the oldest baby boomers entered college in the mid-60s, the annual published cost of attendance at a four-year public university was $951—or $7,256 today when


adjusted for inflation, the study says. But today's incoming college students face published average costs of $19,000 a year at public, four-year schools, more than two-and-a-half times


the amount boomers faced. These higher prices lead many families to borrow, saddling students and recent graduates with debt that poses a major threat to their financial security when they


retire, the study says. “[I]f borrowers’ loan payments partially crowd out retirement savings during the first 10 years of work, they will face retirement account balances that are up to 39


percent lower than for recent graduates without debt,” the AARP report says. In decades past, the thinking went that “if you just work hard enough” in college, “opportunity will be available


for you,” said Joni Finney, a scholar on higher education at the University of Pennsylvania. “I'm just not sure that's a good answer for this generation." The rate that


college costs are rising has accelerated over the years, according to the AARP report. For example, when the first Gen Xers went to college in 1983-84, they confronted costs that were 11


percent higher than the first boomers did in 1964. But when the first millennials enrolled in college in 1998, costs had climbed another 45 percent over what Gen X encountered. And


Generation Z arrived on campuses in 2015 to prices that were 65 percent higher than the first millennials paid. "College today isn't something that many students and parents can


easily cover out of pocket, save toward, or pay for through work,” said Joe Valenti, author of the AARP report. “The benefits of a degree are there, but increasingly require borrowing."


"As recent graduates struggle to address their student loan debt as the result of these increased costs, they will face added financial burdens as they age,” the AARP report said. The


ability to contribute to retirement plans is potentially one sacrifice that can result from stubborn loan debt.


Trending News

Bourne is better and tougher than 'misogynist' bond says matt damon

It's the battle of the JBs as fighting talk from the US star reignited the debate about whether Bond or Bourne is b...

Development and pre-evaluation of a “DiagNurse” mobile app to support nurses in clinical diagnosis using the ADDIE model

Download PDF Article Open access Published: 30 November 2024 Development and pre-evaluation of a “DiagNurse” mobile app ...

Are overdraft protection fees worth it?

Are you tempted by overdraft protection (or "courtesy pay" or a similar nobly named service) for your bank or ...

End of downloading? Google to ban torrent sites from search result

Torrent websites may soon become a thing of the past. The ban is expected to be enforced by June 1, 2017. You may soon b...

Tackle systemic racism to diversify health care and clinical research

DECOLONIZING SCIENCE Science is steeped in injustice and exploitation. Scientific insights from marginalized people have...

Latests News

Student loans leave less time to build wealth

The rapidly rising costs of going to college are threatening the future retirement hopes of younger generations in ways ...

Are overdraft protection fees worth it?

Are you tempted by overdraft protection (or "courtesy pay" or a similar nobly named service) for your bank or ...

End of downloading? Google to ban torrent sites from search result

Torrent websites may soon become a thing of the past. The ban is expected to be enforced by June 1, 2017. You may soon b...

Tackle systemic racism to diversify health care and clinical research

DECOLONIZING SCIENCE Science is steeped in injustice and exploitation. Scientific insights from marginalized people have...

Structural reconstruction of mouse acute aortic dissection by intravenously administered human muse cells without immunosuppression

ABSTRACT BACKGROUND Stanford type B-acute aortic dissection (type B-AAD) is often life-threatening without invasive surg...

Top