New program from Morehouse to eliminate student loan debt

This is from yesterday according to Inside Higher Ed:

The new Morehouse College Student Success Program will solicit and accept donations made specifically to reduce or eliminate students' debt load. Administrators at the historically black institution say they hope the program "becomes a new model for HBCUs and other liberal arts institutions seeking strategies to offset the stress of student debt on alumni and their families," according to a statement released by the college. A study of student loans among HBCU students found that they are more likely to seek loans from more costly sources and have more difficulty repaying them.

Morehouse's Office of Institutional Advancement is in talks with philanthropists, corporate partners and other supporters who have expressed interest in donating to the new program. College officials did not say whether the new initiative was related to the widely covered announcement in May by a billionaire businessman, Robert Smith, that he would pay off an estimated $40 million in college loans owed by students in Morehouse's graduating class of 2019. (He also gave Morehouse $1.5 million in January to fund an endowed scholarship program.) A spokeswoman for the college said details about the total debt of that year's class, and a formal process for paying off the various types of loans the students hold, are still being finalized.

I just got to do some more digging on this. From Black Enterprise:

In light of America’s massive student loan debt crisis, which has ballooned to a whopping $1.5 trillion, Morehouse College announced a new program designed to help relieve the burden of debt for its graduates.

According to the United Negro College Fund (UNCF), 80% of HBCU students use federal loans to fund their education, compared to 55% of their peers at other private and state institutions. HBCU graduates also borrow nearly twice as much than non-HBCU students, while 1 in 4 HBCU students borrow at least $40,000 to attend college. At Morehouse, the average graduate owes between $35,000 and $40,000 in student loans.

It's great to see some attention given to this subject. What can any higher education institution do to lower the student debt burden of students? And how do we stabilize the cost of higher ed?

#MorehouseGrad2019 Robert F. Smith's pledge to Morehouse's graduates

[VIDEO] I posted this over at Shedd School blog on Monday. It's from the mouth of Robert F. Smith who not only got an honorary degree from Morehouse College, but also pledge a grant for those 400 graduates on Sunday to pay off their student loans. An estimated gift of $40 million that gives them some fuel in their tanks as they begin their lives after undergrad.

And as I said in that post over at that other blog, where was he 10 years ago. :P

Also if you want to watch the full commencement speech, I got it on yet another blog.

Is college worth it?

[VIDEO] I wish I had this advice from Dave Ramsey back in high school. The expectations for many of us whether from our families to even some of the teachers/counselors in school was that we'd go to college. The advice I should've gotten was about planning and then of course having a plan once I got the degree.

What does this mean? What type of job do you plan to have once you graduate? How much money are you willing to spend on college?

With that said over the years, I've had to realize that perhaps we've been going overboard with sending our young people to college. It's an important investment for sure, but again most young people need to plan. I really didn't even if it took me some time to finally finish.

Another thing that I've said is that it seems a college degree has become devalued and taken for granted to the point where it's not just another high school diploma. An undergrad degree once had value, how do we give it value again?

This clip was from a little over three years ago and hopefully parents are discussing college and long term plans with their children who are high school juniors or seniors.

Women’s Student Loan Debt Nearly Twice As Men’s

I suppose it's funny that this could somewhat piggy back on last night's post on the deflation of the college bubble:

Women owe about $890 billion of the country’s $1.48 trillion student loan debt, nearly double the $490 billion owed by men, placing them at a financial disadvantage as they begin their careers, according to a recently released report from the American Association of University Women (AAUW).

The study, which analyzed data from the U.S. Department Education from the 2015-2016 school year, also found that women graduating with bachelor’s degree owe on average $2,700 more in student loans than men do. Women, who account for 56 percent of enrolled college students, are far more likely than men to graduate owing money — 71 percent for female grads vs. 66 percent for male grads, according to the AAUW.

And this stat was broken down further according to race:

Black women graduate with the most college debt, averaging about $30,400, topping the roughly $22,000 white women owe and the $19,500 white men owe.

Furthermore, women with college degrees and full-time jobs tend to earn less money to pay down their student debt, making on average 26 percent less than their male colleagues. The picture is even bleaker for black and Latina women with bachelor’s degrees and full-time jobs: They earn on average 37 percent and 34 percent less, respectively. than white men and, as a result, often struggle to repay their loans, the study says.

If you keep reading article you're going to see it, this gender pay gap! For some reason not explained here Black and Latin women earn less than white males. Kinda wild when you think about it.

The solution according the the aforementions AAUW is to strengthen pell grant programs. For me I benefited from pell grants however I chose to complete my baccalaureate from an expensive private liberal arts college so the fact that I borrowed money negated the benefits of those grants.

The answer for both men and women of any race/ethnicity is they need to have some skin in the game as far as college. Have a viable plan and don't just depend on federal aid or the financial planning of your parents, put your own money up. If it's something you're serious about show what you have, this is what I wished that I had when I graduated from high school.

If you graduated from high school this year it's still not too late for you to develop some financial saavy as far as your education. It shouldn't matter if you decide you have to take a break from school for now if tuition is going a bit higher as you matriculate.

I can also add, that college isn't and shouldn't be the answer for everyone! 

Student loans

The idea of holding up people's professional or driver's licenses due to student loan debt doesn't make a lot of sense to me. Someone is in student loan debt and perhaps they have a law license (probably incurred even more debt to go to law school) and if they can't practice law if that debt remains unpaid. Or if it's necessary for you to drive to work you can't - well shouldn't anyway - if your state decides to suspend your license over student loans.

So basically student loan bill collectors have tools at their disposal that will make it difficult for you to either get the job that enables you to pay off the debt or even harder to get to work so you can pay that debt. So think about it if you don't pay off your student loans we'll make it harder for you to get out of debt by taking away a professional license or you just can't drive.

Too bad! Shouldn't have gotten into debt anyway. Your responsibility!

Anyway, this post at Instapundit shows that there are people in Washington, DC who are trying to curb that. I think there are many looking for some form of relief.

Also I never thought of student loans this way:  "At the same time, Americans are spending more than they can afford on higher education, driven by the kind of cheap credit that fueled the housing bubble."

With my experience at Morehouse in mind - with financial aid and student loans - now that makes sense to me.

CNBC: It May Soon Be Easier To Declare Bankruptcy On Your Student Loans

[VIDEO] I'm looking forward to this - and of course there are other solutions that I should share with you. Find you a lawyer and then determine undue hardship which according to the above video is being more concisely defined by the Dept. of Education. All the same if you cross your i's and dot your t's it's easier to discharge some student loans in bankruptcy. Of course hopefully you can pay for that attorney to help you sift through the legalities.