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Increasing Student Debt Transparency

Gayle Nelson
July 11, 2017
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“Fix the Student Debt Problem” by Joe Brusky

July 7, 2017; Oregonian and USA Today

Overall, 44 million Americans hold $1.34 trillion in student debt. Few college aid students understand the ramifications of their student loans on their future ability to buy a home or start a family. A student receiving their undergraduate degree in 2016 left owing an average of $37,173 of debt, an increase of 6 percent from the year before and approximately an 85 percent increase in the last ten years. Debt for graduate study and other advanced education has quadrupled since 1989, growing from slightly less than $10,000 to more than $40,000, while debt from bachelor’s degrees increased from $6,000 to $16,000.

Student debt is often young adults’ first encounter with large, long-term debt. Many sign the dotted line with little education or understanding of the ramifications. This debt can force these students into specialties or employment opportunities they would not choose if it were not for the extra income. This debt is also a drain on the country’s economy; many believe it’s one reason the growth rate is so low.

Clearly, students are struggling to navigate and evaluate financial aid deadlines, applications, and opportunities. The state of Oregon recently passed legislation, to take effect in January 2018, requiring state colleges, universities, trade schools, and other post-secondary programs to provide students with financial aid information that is “straightforward” and “easy to understand,” assisting students in comprehending the amount of debt they are taking on and the amount they will be responsible for once the loan payments begin.

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Specifically, each year, schools must provide:

  • The total the school is charging in tuition and fees,
  • The total amount of federal education loans the student is assuming,
  • An estimate of the repayment cost, or a range including principal and interest,
  • The anticipated monthly payment, and
  • The borrowing limit percentage the student has reached on each loan.

The law doesn’t apply to privately held loans.

Legislators hope this additional information will relieve the growing student loan delinquency rate, which reached 11.2 percent last year. However, awareness of student loan debt is just part of the solution. What we really need is to rethink why students nowadays have to become heavily indebted in order to have a chance at a job that pays a decent wage.—Gayle Nelson

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ABOUT THE AUTHOR
Gayle Nelson

Gayle Nelson, Esq is a leader responsible for raising millions of dollars for diverse nonprofit organizations. Since over three quarters of revenue flows from individuals, Gayle begins her work expanding organizational capacity by coaching leadership on development best practices and engaging new volunteers. In addition, she reaches out to major and younger donors planning exciting events and increasing visibility utilizing crowdfunding, social media tools, and traditional media outlets. With a strong network and knowledge of philanthropy, Gayle coaches organizations of various sizes on opportunities to increase revenue from Donor Advised Funds (DAF) and planned giving vehicles as well as public and private foundations. Additionally, she often writes proposals funding new programs and develops earned income revenue streams. As an attorney, Gayle is also an advocate, partnering with nonprofits to enhance their relationships with government leaders to pinpoint community need and promote agency services. And, to ensure activities lead to thriving organizations and long-term sustainable growth, Gayle utilizes her financial acumen to partner with Boards and finance staff to build comprehensive program and agency budgets. Finally, she is a highly respected speaker on diverse topics including shifting government funding, succession planning, and inter-generational board/volunteer engagement.

More about: Nonprofit NewsPolicystudent debtstudent loan reform

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