The article “Why the Student Loan Crisis Is Everyone’s Problem” by Joseph Orsolini shows how the money led to the learners helping fund their education has adversely impacted all people’s economies. Orsolini is a financial planner who helps families regardless of their income level to plan for colleges, retirement advice, tax preparation, and college savings. He notes that increasing student loan debt is progressively becoming a problem for American society. Orsolini presents statistics about the millennial generation, which shows changes associated with the rising student loan debt.
Any information presented by Orsolini is about dropping expenditure on cars and restaurants. The data show that the youths aged between 25 and 34 years scoreless on restaurant spending since 2012, even though they were number one during past decades. Additionally, most of them opt for public transportation, biking, or walking because they cannot afford cars. Moreover, Orsolini indicates that 35% of the same population live with their parents because they are servicing loans or are not employed.
Other facts presented by Orsolini are the age of getting married, cohabiting young adults, and reality about real estate. The first marriage average age in the United States has increased from 22 and 24.7 for females and males to 28 and 29.8 years. The change can be attributed to the fact that most millennials live with their parents. Conversely, 15% of youths aged between 18 and 34 are cohabiting because they cannot afford to fulfill marriage and family financial responsibilities. The real estate market is dropping because young couples who are lucky to get married cannot purchase a house due to loan debt.
The increasing student loan debt and the competitiveness of modern job markets are key factors that can explain the struggle to achieve financial stability among the millennial generation. Orsolini presents a case of McDonald’s to show the millennial impact and proposes how the cycle for student loan debt crisis can be ended. He indicates that youths’ preference to live in cities and use public transportation contributed to McDonald’s decision to move its headquarters to downtown Chicago from the suburban campus. The youths have created treads that are significantly influencing all aspects of the US economy. Orsolini notes that the treads are caused by the student loan debt crisis, which can be associated with the 2008 economic recession. He indicates that educating clients about smart college planning for finances can help break the debt crisis cycle. The first strategy that can be instrumental in the process is busting some myths associated with college planning.
The first myth is that an individual’s attainment of a college education guarantees them more earnings by approximately $1 million. Indeed, the statement sounds factual because higher education increases the chances of securing high-paying jobs. However, Orsolini notes this is not true because such students lose about $240,000. He proposes that students be joining junior or community colleges and then transfer to a university to reduce the cost of education. The second myth is that attending highly selective colleges makes students more successful. It is unnecessary to pay high costs to these colleges because students’ efforts, determination, and commitment define their success and not an institution. The last myth is that parents will remove kids from their houses by sending them to colleges. Debts burden the graduates, and they cannot afford a house or rent. Therefore, it is essential to educate parents and students on making wise decisions regarding colleges and finances.
Reference
Orsolini, J. (2020). Why the Student Loan Crisis Is Everyone’s Problem. Journal of Financial Planning, 33(1), 12-14.