By Lauren Pratt|staff writer|
Three in four college students with loans believe the debt will impact their post-graduation goals, according to the American Institute of Certified Public Accountants (AICPA).
Due to the inflationary increases in health care, energy, salaries and pensions, colleges, according to College Board, average cost of tuition and fees for the 2015-2016 school year was $32,405 at private colleges, $9,410 for state residents at public colleges, and $23,893 for out-of-state residents.
Now, about two-thirds of full time students are paying for college through financial aid in the form of grants and scholarships, and 59 percent in loans, reported Business Wire.
Students loan debt continues to pile up on America’s college graduates, averaging $29,000 per student, according to the Institute for College Access and Success on Student Debt.
Though a college degree is often an aid in financial security, the high cost of individual student loans may be forcing many students to postpone major decisions, such as marriage, having children, purchasing a home, and saving for retirement.
Many students also said their loans mean they would likely be living with their parents after graduation. With 37 percent having to take a job outside their field of study, according to an online study conducted by Harris Poll on behalf of the AIPCA.
“While a college education is increasingly essential in today’s economy, student loans take years to pay off and can cause individuals to put their life ambitions on hold,” said Greg Anton, Chair of AIPCA National CPA Financial Literacy Commission.
Fifty-nine percent of college students with student loans say their loans will take less than a decade to pay off. In actuality the standard repayment plan for federal student loans, according to the US News and World Report 2014, takes 21 years to pay off.
Under federal income-based repayment options, however, remaining debt is forgiven after 20 years, according to CNN Money.
“Not only do students feel like they may have to [stay at home] most need to. Most careers do not begin the day after graduation. Going home, for most, is a time to get back on your feet,” said student Jessica Williams.
With 45 percent of college graduates back at home, the National CPA Financial Literacy Commission encourages students to learn how to manage the cost of a college education to avoid staying at home.
Factors that the commission encourages, according to American Institute of CPAs (AICPA) member Marc Eiger include:
-Do not take out more in total student loan debt that you can reasonably expect to earn in your first year in the field of your major.
-Exhaust every available source of “free” money before getting any type of loan.
-Meet with a financial advisor at school to discuss available scholarships.
-Be aware of the difference in pay-off options between Federal and private student loans.