Maggie: College isn’t cheap: tuition is soaring and people have huge student loans. It is not just a problem for you guys. Americans 60 years old or older owe $36 billion in unpaid loans! And lawmakers can’t agree on how to fix the problem.
Raeann Roca graduated from Ohio Northern University five years ago after taking out $70,000 in student loans. Add in interest — or the fees paid to the banks — and it is $106,000.
Reaann Roca: Most people who owe $106,000 in debt have a house or a couple of cars or a few houses, and I don’t have that. I have the basic necessities that I need to survive.
Maggie: Raeann now works in public relations in Washington, D.C. Twenty-five percent — that is one-fourth — of her monthly income goes toward her student loan debt.
Students graduate with more debt now than they did when their parents were in college. The average cost for a four-year degree was more than $22,000 in 2010, 67% higher than in 1990.
Isaiah Toney is a senior at George Washington University. He says he will graduate next month owing approximately $85,000 in loans.
Isaiah Toney: I’m 22. How do I know how much $85,000 is? You know, it’s the single biggest purchase I’ve made in my life.
Maggie: Toney says he considered becoming a teacher or studying abroad, but his debt means he has fewer choices.
Toney: It’s this slow realization that, you know, you won’t be able to take the kind job you really want or you won’t be able to travel or give back to your community in ways that you want.
Maggie: College loan costs are under debate in Congress right now. Republicans and Democrats both say they want to help former, current and future students but that help comes at a price, and they disagree on how to pay for it.
The current interest rate on one type of federal student loan is scheduled to double on July 1st to 6.8% unless Congress finds $6 billion to keep the rate at 3.4. The Republican-controlled House of Representatives has passed a bill to keep the interest rate low by using money that would go to health care. But that is why President Obama says he will veto it. Democrats want to get the money from a tax on some businesses.
Meantime, Raeann Roca says the earliest she will be able to pay off the first of six loans is in the year 2022.
Raeann: I don’t ever see a time in my life where I won’t be paying my student loans.