by Mitch Kokai
Senior Political Analyst, John Locke Foundation
College freshmen are leaving home for new schools and new lives, preparing to make the mistakes that freshmen have made for many years.
Parents, don’t think of this as losing a child; think of it as taking on a fresh set of risks and worries. Especially this: Too many college students are signing up for student loans without understanding the full cost of college or the academic standards they will have to meet to graduate.
Total student debt has doubled in a decade. Nearly 70% of last June’s graduates were in debt. Average debt of the grads was almost $30,000. The delinquency rate is 11.6%. Counting loans in payment deferral, forbearance, grace periods, and default together, the federal direct student-loan program’s rate of payment-free loans is about 40% in money terms and 43% in terms of borrowers. College is becoming a dangerous investment.
Dropping out is a bigger pitfall than many students realize. They may have been told that a college degree is the key that opens the door to the middle class and beyond, but more than 30% of students at four-year institutions do not graduate in six years.
Academic need is closely linked to financial turmoil. More than half a million members of the 2011 freshman class—that’s one in four— had to take remedial classes. Students who have to take remedial classes are 74% more likely to drop out, according to Education Reform Now, a lobbying group in Washington.
Although 36% were from the lowest income quintile, 45% were from middle- to high-income families. “Inadequate academic preparation does not end with students and schools from low-income communities,” says co-author Mary Nguyen Barry. “Inadequate high school preparation, as reflected by postsecondary remedial-course enrollment, is also a middle class and upper class problem and has real financial consequences for all.”