Would you rather listen to this? I discuss this article in Episode 40 of Personal Finance for Long-Term Investors (formerly The Best Interest Podcast), below.
My previous thoughts on student loans haven’t changed.
- The total student loan debt is a big problem. Housing debt was $1.3T in 2007. Student debt is currently over $1.75T. It’s not a perfect comparison (are we selling wild insurance on this student debt?! No, we’re not…) but it’s illustrative. Student debt is a problem.
- Forgiving loan principal is not the solution. It’s morphine for a bullet wound. The pain is dulled, but we’re still bleeding. Infection and death aren’t if, but when. Colleges are still raising prices, and teenagers are still borrowing $250K to meet those prices. That’s the wound.
If you want to learn more:
- Friend-of-the-blog Jack Raines has good thoughts here.
- …and another FOTB Nick Maggiulli here.
- …and another FOTB Katie Gatti Tassin on this podcast.
- Scott Galloway, who is too famous to have heard of this blog, has good thoughts here.
- My (older but still good) answers are here.
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