New Study: Record Numbers of College Grads Are Filing for Bankruptcy
We are living in a topsy-turvy world. The latest piece of evidence? Researchers have found that college grads are filing for bankruptcy in record numbers. In fact, more college grads are filing for bankruptcy than just about anybody else.
I mean, I thought college was supposed to increase a person’s odds of earning a good living and becoming economically secure, right? But it turns out that in a growing number of cases, the opposite is true.
The study, just released by The Institute for Financial Literacy, is called “Consumer Bankruptcy Filings among College Educated, High Income Earners on the Increase.” Here are some of the findings it reports . . .
- College education doesn’t ward off bankruptcy. In fact, the number of degree holders filing for bankruptcy has increased by 20% in the last five years.
- Neither a college education nor a high paying job is enough to protect consumers against filing for personal bankruptcy.
- The most common reasons for financial distress include: overextension of credit; unexpected expenses, illness/injury and divorce.
What Can College Students Do to Avoid Bankruptcy?
I bet you thought that the answers to that question would be complex or hard to implement. In fact, they aren’t. Here are some very simple ways to enjoy the value of a college education without running the risk of financial failure . . .
- Slash the cost of going to college. Armed with the right information, you can use online learning and other options to cut the cost of college by 25% or more. If you don’t borrow money in the first place, you don’t have to pay it back.
- Don’t finance your education with usurious bank loans that charge absurd interest rates. Take Federal loans instead, and cut the cost of your borrowing.
- Major in a subject that promises you a job and a living wage after you graduate. And balance out your debt against your potential earnings. If you want to enter a field like teaching, for example, avoid taking on $100,000+ in debt to pay for your education. Slash your college costs instead, so you have a good chance of paying your loans back once you are working.
In summary . . .
The real problems are that students are paying too much for college, and borrowing too much to pay for it. If you can use online learning and other strategies to avoid those problems, you really can earn a degree and benefit from it too – even in our topsy-turvy world.
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