The Student Loan Crisis And the Lack of knowledge of students

The expectation to be college educated in order to obtain a ‘good’ job means that many young people take on large loans, often lacking understanding of the long term consequences of incurring such substantial debt. Student loan debt is a ticking time bomb. It is bad for U.S economy because it takes a toll on other areas such as housing, retirement and discretionary housing spending. Climbing from about $364 Billion in the first quarter of 2005 to about $904 Billion in the first quarter of 2012, student debt is already passing credit card debt as the second largest form of consumer debt behind mortgages. Due to student debt being so normalized, many people have a true lack of understanding surrounding this issue. This lack of understanding causes them to make bad decisions that may have a negative impact on their future. This paper will look into the different aspects of student debt and why it has grown to be so large.