Student loan debt is the second highest consumer debt category in the U.S. and many college students are inexperienced at managing money, therefore carrying student debt can have a profound impact in your life (Friedman, 2019).

In addition, making smart financial decisions is difficult with the pressures of increasing tuition fees every year and the lack of financial literacy.

Many college students are first-generation and signing up for loans with little to zero financial education. Some students work so much to try to keep up with tuition payments and end up having to take out credit cards and loans to pay their daily expenses.

Students work so hard in class and outside to receive a degree and end up graduating with a pile of debt waiting for them due to interest accumulating and not being informed of what type of loans they are accepting.

Janette Camacho is a 2018 graduate student and is now dealing with the struggles of student loans.

“I started paying for my loans once I was out of school. I waited until my loan was off of the grace period to start paying them. I didn’t have knowledge of financial advice when signing up for my loans, I had to research the difference between subsidized and unsubsidized loans when accepting my loans my first quarter of college,” said Camacho.

Many students are not aware of where to find the resources or advising to share their concerns about student loans and seeking financial advice.

Alexis Yarto is a fourth-year Communications major who turned to loans as an emergency to pay for tuition and did not thoroughly research his loan information.

“I started taking out loans since my first quarter of college and last fall I capped out my loans, I didn’t even know that was possible. I’m doing the payment plan now, but I haven’t checked out what is going on with my loans yet and I never really knew where to ask questions,” said Yarto.

The Financial Aid Office is located in University Hall, an on-campus resource that has paraprofessional staff at the walk-in counter during regular business hours. Advisors are available from 9:00 am to noon and 1:30 pm to 4:00 pm on a daily basis if a student requests additional and/or personal assistance. Students are also able to use the computers in the Financial Aid lobby to log in to studentaid.gov.

If students are not on campus, they can also access resources on csusb.edu/financial-aid/current-students/loans for more information on the type of loans.

Wendy M. Rose is a Financial Aid Advisor at CSUSB and said, “My best piece of advice on loans for students: Don’t take them out if at all possible. Only take out the Subsidized loan. If need Unsubsidized, pay the minimal interest on a monthly basis so that the interest doesn’t accrue over time.”

Students are stuck between the decision of debt or degree. Making these resources more aware it can prevent the frustration of student debt post-graduation and making the payment process more manageable.

Daniel MacDonald is a professor in the Economics department at CSUSB. As a professional in the economic history of the U.S., labor economics, law and economics, statistical and econometric methods in economics he shared his perspective on the effects of student loan debt on the economy.sf

“There are positive and negative effects of student loan debt. On the positive side, it can persuade some people to get a job that they wouldn’t otherwise get if they didn’t have to pay off student loans. Some people want to take it easy and not actively search for work. Having some student debt can make sure students don’t get too comfortable. On the negative side, it can push students into jobs that they don’t want to take. After graduating from college, students want to take some time and find a job that fits their skillset. But if they have student loan payments approaching, they might just take the first job offer they get, which might not be the best match for them or even the best-paying job,” said MacDonald.