Student Loan Debt Should NOT Be Cancelled

Student loan debt is a topic that: (A) cycles in and out of political discussions, (B) the news, and (C) routinely trends on social media.

Many U.S. citizens, particularly those with progressive ideals, want student loan debt to be cancelled (i.e. forgiven) by the federal government and/or president of the United States.

I’m of the opinion that student loan debt should NEVER be cancelled – in the same way that debt from any other purchase should not be cancelled and/or paid for by the government (a.k.a. taxpayers).

Why student loan debt should NOT be cancelled…

Included below are reasons I think student loan debt should NOT be cancelled. Keep in mind that these are just my opinions.

dab-t or debt?

1. Some students prioritize paying off student loans

This is simply not fair for those who prioritized paying off student loan debt as quickly/efficiently as possible.

Someone may have had a lot of debt, but might’ve taken on “side hustles” (i.e. extra part-time jobs between studies) and/or worked overtime post-graduation with the intent of using any extra influx of money to pay off student loans.

Those who didn’t prioritize student loans (or neglected them) and/or didn’t work extra jobs (or overtime) would essentially be rewarded for being irresponsible and/or lazy.

2. Some students choose “lower cost” universities (instead of expensive ones)

A subset of college students may have chosen “lower cost” universities instead of their “dream schools” because they knew the latter would be more expensive – resulting in significantly more student loan debt.

Although many would’ve loved to attend their dream colleges – they were practical and smart enough to evaluate the potential financial implications (e.g. more substantial student loan debt).

Why should we reward students who insisted on attending a “dream college” – yet the one who deliberately chose a less expensive university (to avoid massive loan debt) gets nothing because he/she already paid everything off.

3. Some students abuse “student loans”

Although most people think of student loans as being used primarily for tuition – there are a host of things that student loans can be used on, including (but not limited to):

  • Tuition & fees
  • Room & board
  • Groceries & food
  • Housing supplies (e.g. linens, microwaves, dishes)
  • Computers
  • Studying abroad
  • Transportation
  • Child care expenses
  • Fees for professional testing

Some people find ways to use their student loans for a variety of other things as well, including (but not limited to):

  • Vacations (e.g. spring break trip)
  • Alcohol, nicotine, drugs, etc.
  • Clothes
  • Expensive drinks/meals
  • Buying a vehicle
  • Electronics (e.g. Air pods, new cell phones, iPads, gaming systems, TVs, etc.)

So let’s say someone took out a massive student loan to pay for everything listed here – does it seem fair that the loan should be cancelled by the government (essentially paid for by taxpayers)? It shouldn’t to sane people.

Many non-students assume that student loans are used primarily for: tuition, fees, room/board, necessary school supplies (e.g. notebooks, pens, and maybe a computer), and low-cost food.

Unfortunately, a significant percentage of students downright abuse student loans – putting the money towards things like: new clothes; TVs; gaming systems; unnecessary electronics (e.g. tablets, the latest phones); studying abroad (unnecessary); vehicles; spring break vacations; and/or alcohol/nicotine habits.

Is it really fair that the “government” (i.e. taxpayers) would end up subsidizing things like vacations, clothes, expensive meals, down-payments on homes, vehicles, studying abroad, etc.? Answer: No – it isn’t.

4. Students should be held accountable for choices

Cancelling student loan debt effectively allows students to make insanely irresponsible and/or dumb decisions throughout college – a time when they’re supposed to learn to make smarter, more responsible choices.

  • Choice of university: Students generally have multiple options regarding the specific university they choose to attend.
  • Choice of loan usage: Students choose how they want to use their student loans – do they want to “run up a check” or be as frugal as possible to minimize loan amounts.
  • Choice of degree: Students are able to select whichever specific degree they want to pursue. Selecting a degree with: (A) poor job prospects and/or (B) low earning potential – is nobody’s fault but the student.

Why should taxpayers bail out the students that select: expensive universities, abusing student loans, and pursuing impractical degrees? This would be ridiculous.

5. Unfair to those who skip college (slap in the face)

Many people skip college altogether and: (1) immediately get a job and/or (2) pursue a low-cost trade school and/or apprenticeship.

  • Immediately get a job: Some people finish high school and immediately enter the workforce. Jobs that require only a high-school degree include: Delivery driver; flight attendant; restaurant server; graphic designer; bartender; hazmat removal worker; sales representative; janitor; writer; coder/programmer; insurance claims adjustment; security guard; etc.
  • Trade school: Trade school costs money, but it’s generally far less expensive than most colleges. Jobs requiring a trade school degree include: air traffic controller; construction manager; elevator mechanic; boilermaker; electrician; plumber & pipefitter; HVACR technician; licensed practical nurse; etc.

A subset of those who “immediately got a job” (out of high-school) or pursued “trade school” – may have actually wanted to attend college – but might’ve thought it was relatively impractical when considering the large student loans that would’ve been accrued.

Instead, these individuals are working hard, contributing to society – while a college student is attending their “dream school,” getting the “full college experience,” and racking up student loan debt.

Why should these people (along with other taxpayers) subsidize the college attendees? After all – they could’ve also opted to get a job immediately out of high-school or attend a lower cost trade school – they made a choice to pursue college instead.

This would be a slap in the face to those who were unable to go to attend college – and those who intentionally opted to skip college.

6. Many parents instill “must go to college to be successful” mentality

Although at various time-points in history it would’ve likely been a dumb move not to go to college (due to the far higher earning potential for simply “having a 4-year degree”) – this is no longer the case.

These days, in some cases, it’s actually idiotic to attend college – particularly if you have no idea: (1) what degree to pursue; (2) the expenses involved; (3) the endgame (e.g. job, student loans, etc.) – or if you (4) already have a solid job (e.g. starting your own business).

The value of a college degree is no longer as substantial as it once was. Many college graduates that pursue subpar/useless degrees (e.g. art history) merely waste time and money – and end up working the same jobs as individuals without college degrees.

Parents and their kids should think critically about whether attending college is: (1) practical; (2) affordable; and/or (3) an all-around smart move – weighing all the potential pros (e.g. education, social connections, college experience, etc.) and the cons (e.g. student loan debt, time wasted, etc.).

Parents and kids should also be encouraged to extensively evaluate things like: (1) specific degree (profitable? competitive? jobs available?); (2) school (costs?); (3) earning strategies during college (e.g. working part time); and (4) post-college plans.

7. Many students can get scholarships for free/discounted tuition

Many individuals who are motivated/driven will apply for every single scholarship opportunity for which they qualify – as these may provide significant financial assistance.

Some individuals attain “full ride” (i.e. full tuition) scholarships in a variety of ways including (but not limited to): athletic talent; academic achievement (GPA & ACT/SAT); being an active duty fireman or police officer; and even from something as simple as working at Starbucks.

Even if students are unable to get a “full ride” scholarship – there are numerous “partial scholarships” offered by both schools and businesses that can be acquired to help save additional money on tuition fees.

Considering the plethora of scholarship opportunities, many students should be able to net some additional savings if they actually put forth the proper effort.  Why should taxpayers pick up the rest of the bill when the student could’ve worked hard for a scholarship if attending college was the “dream”?

8. Students can get part time jobs & summer jobs

If college is really someone’s “dream” – then they should work towards paying for it themselves.

This means: (1) time management (completing schoolwork & studies as efficiently as possible); (2) getting a part-time job (during college); and/or (3) getting a full-time summer job (if not taking college classes in the summer).

Many students can apply for part time jobs at the university they’re attending (e.g. library assistant, computer tech, gym assistant, groundskeeper, security, etc.) – such that they don’t need to travel far to get to “work.”

Students who don’t have any college classes (“studies”) in the summer can get a full-time job and take on all the extra hours they can get.  Most people can earn at least $10 per hour (this is below the minimum wage a lot of places).

Assuming a student works a full-time job (40 hours per week) – and earns $10 per hour, this means they’ll be making (pre-tax): ~$400 per week, ~$1600 per month; and $4800 for a 3-month term.

Someone working a bit more at ~60 hours a week would be earning (pre-tax): ~$2400 per month – and $7200 for a 3-month term.  Although this may not cover all tuition costs, it instills hard work and sacrifice to pay for the choice that the student made (to prioritize a college education).

9. Students can probably be more efficient

Many college students can likely finish 2 years worth of college credits in 1 to 1.5 years with proper time management and focus.

Although this might not be doable for every single person, there are a significant number of people that slack off (partying, “hanging out,” vibing/chilling, etc.) for a substantial % of time – when they could use this time more efficiently (e.g. additional classes, studying, etc.).

By being highly efficient with studies and time, students that otherwise would’ve needed 4 or 5 years to graduate, might finish in just 2 or 3 years – such that they saved themselves 1-2 years of tuition fees, room/board fees, etc.

It’s fine that some individuals choose to pace themselves (slow and steady, work/life balance, etc.) and rack up a larger student loan bill – but why should taxpayer money bail them out? After all, they might’ve been able to save themselves $20,000 to $30,000 by being more organized and putting forth more effort.

10. Universities not held accountable

Perhaps the single most significant reason that I think student loan debt should NOT be forgiven is because universities are not held accountable for moronic, blatantly horrible practices.

These include: increasing tuition fees, raising book fees, increasing parking fees, forcing students to take unnecessary/irrelevant classes (costs students time & money), inefficient spending (e.g. gold-plated fountains, statues, etc.), hiring more administrators, hiring gourmet chefs, putting OLED TVs in the library, etc.).

Cancelling student loan debt effectively allows universities to continue: (A) operating as inefficiently as they want and (B) providing little overall value to students (ROI on time/$ invested) – all while charging students a king’s ransom.

  • Forcing students to be “well-rounded”: This is among the single dumbest policies instilled at universities. Stoking curiosity in a variety of subjects isn’t inherently bad – but when your goal is to become a computer scientist and the university requires classes like: English literature; Physical education; History; Liberal arts; etc. – this is robbery (of both $ and time).
  • Increasing tuition fees: Tuition fees continue increasing each year. There’s always some “BS” reasons that are pulled out of thin air (many of which make little to zero logical sense). Usually increasing tuition is due to inflation, inefficient spending (by the university), a sufficient supply of suckers (those willing to pay), and administrative/tenured padding pocketbooks and research labs.
  • Increasing book fees: Each year academic book writers make minor revisions to existing books and jack up the fees. New college textbooks (on average) cost ~$80+ per book. Have 10 classes that require the latest books? That’s around $800.
  • Increasing room & board fees: Universities regularly increase room and board fees each year – sometimes each semester. This may be due to them adding new features (e.g. remodeling) or simply adjusting for inflation.
  • Administrative fees: Andrew Yang thinks the biggest problem with many universities is administrative “bloat.” They’re increasing tuition costs because they’ve continued to add more administrators (each demanding a high salary with benefits) without necessary reasons such that the additional costs are incurred by students.
  • Zero job guarantees for students: There are ZERO job guarantees for students following college graduation. Interestingly, there are alternative, hyper-focused programs for things like coding/software engineering that have legitimate job guarantees or your money back (i.e. get a full refund).
  • Failure to properly advise students: Students with loans (in my opinion) should only be permitted to pursue a degree that has significant, reasonable-paying job prospects. Additionally, students should be guided towards landing a job post-graduation.
  • Tax-free entities: Universities are tax-free entities – and don’t pay any money in state or federal income tax. Instead, they amass millions and/or billions of dollars in “endowments” and invest/use however they see fit.
  • Required classes “full” (unavailable): Some students end up frustrated because certain classes fill up prior to their enrollment period. There’s some sort of hierarchy at certain universities wherein classes may fill up and become unavailable – such that students need to wait yet another semester to take them. (This is somewhat of a long-term scam in that students end up staying another entire semester just because a class was “full” the previous one.)
  • Buying unnecessary BS: The primary reason for attending college (for most people) is to get a quality degree and leverage that degree to get a high-earning career/job. Colleges don’t care about this – their primary goal is to extract as much money from students as they can get away with, all while spending the money in whatever ridiculous ways they see fit. Common examples: Statues, gold-plated plaques, new buildings (even when unnecessary), fountains, saunas, pools, TVs, entertainment/performances, etc.
    • NYU spent $72M in interest-free loans for star faculty to purchase vacation homes.
    • Mizzou used $38.9M of mandatory student fees to build a gym “better than Nike’s.”
    • Auburn University’s president gets paid $2.5M.
    • University of Phoenix earned $423M in profit despite a 1% graduation rate (damn!).
    • University of Kansas had 5 consecutive basketball coaches that earned ~$1.5M per year.
    • Ashford University’s CEO received a $20.5M compensation package in 2009 – while 19.8% of students defaulted on student loans.

11. Eternally living as a college student (Van Wilder vibes)

Van Wilder is a 2002 movie about a guy (named Van Wilder) who attends college for 7 years but never graduates.

He’s essentially milking the college experience for as long as it’ll last because he enjoys it and it’s become part of his identity. Meanwhile, he’s putting forth zero effort to study and actually earn a degree.

Although this premise is somewhat unrealistic (as many colleges might kick students out for chronically underperforming) – if “student loans” are regularly forgiven, we might see an uptick in the number of Van Wilder-esque students.

One could keep taking out a new student loan (each time their old student loan is forgiven by the government) and remain in college indefinitely to “keep learning new things” and get “multiple degrees” for the mere sake of intellectual curiosity – without actually contributing to society.

This means that, as long as you maintain standing as a college student by not failing, you’ll keep getting your loans cancelled – and the government will have funded things like: apartments; electronics; food; vacations; clothing; etc.

Note: It is likely that limits would be placed on the number of student loans each student is allowed to have forgiven (such that they can’t take out a second student loan after the first is forgiven) – but who really knows.

12. Lenders not held accountable

There have been numerous allegations of “abusive lending practices” rendered by students against lending companies.

In 2022, Navient, a major student loan company: (1) agreed to cancel $1.7B in debt owed by more than 66,000 borrowers across the U.S. and (2) paid over $140M to about 350,000 borrowers in long-term forbearances – to settle allegations of abusive lending practices.

According to Attorney General Josh Shapiro: Navient engaged in deceptive and abusive practices, targeting students who it knew would struggle to pay loans back, and placed an unfair burden on people trying to improve their lives through education.

Among other things, Navient misled borrowers who were having trouble making payments into entering what are known as “long-term debt forbearances” – which caused them to rack up more debt.

Although the students should technically be held accountable since they were: (A) legal adults (18+) and (B) signed the loans – many of them likely did NOT know what they were signing or that they’d be getting screwed over financially by Navient.

The overarching point here is that if the U.S. government cancelled all student loan debt (by paying it off) – companies that were deliberately deceptive and/or abusive face zero repercussions… they still get all of the money that they hustled students out of.

13. High cost subsidized by taxpayers outweighs benefit to society

According to the Committee for a Responsible Federal Budget, cancelling all student loan debt in the United States would cost an estimated ~$1.6 trillion dollars. (R)

And who would be paying for this debt? Not the president – but the United States taxpayers a.k.a. the hard-working people that fund the U.S. National Budget.

Is it fair that people have their hard-earned tax dollars redirected towards funding someone’s personal choice to attend college? If this is the case, then why can’t tax dollars also cancel a loan I took out for a business, vehicle, and/or a house?

Why should student loans get preferential treatment? Because educated people are helping the economy more significantly than others? Not true.

Many people without college degrees who are employed full-time have contributed way more to society and the economy than many individuals in college.  What significant benefit does society extract from someone with an art history major? Yet taxpayers would subsidize this.

One could actually make an argument that it would be smarter to take out a massive student loan and invest the money wisely such as in rental properties, the stock market, etc. – or even in starting a business – and continue working full-time.

When it comes time to pay off the student loans, your earnings have significantly outpaced the loans – such that you’d been working full-time through college (employer or self-employed) and you now have a basket of assets (e.g. real estate properties, etc.).

The previously mentioned scenario is a much more favorable one than someone who got a 4-year art history degree, didn’t work much throughout college, and now is wondering why: (A) they can’t get a job; (B) have a massive student loan; and (C) they wasted so much time going to college.

14. Increases government debt & consequences

Although increasing the federal government debt isn’t necessarily always problematic, there are various legitimate reasons that a $1.6 trillion-dollar debt accrual from cancellation of student loans might be unwise.

According to the Carnegie Endowment for International Peace: (R)

  • Transfers: Increasing government debt can create an “ex-ante” disparity between total demand and total supply in an economy – such that an automatic adjustment mechanism to restore equilibrium between the 2 by transferring income from one sector of the economy to another can occur. This transfer mechanism can distort the economy in ways that might undermine growth.
  • Financial distress: Rising government debt can indirectly undermine economic growth. Uncertainty about real debt-servicing cost allocation can cause various sectors of the economy to change behavior to protect themselves from being force to absorb the real cost of debt.
  • Bezzle: The rapid rise of debt can lead to systemic creation of fictional growth and bezzle. This fictional wealth, the creation of which distorts economic activity, can consist of inflated asset prices and capitalization of expenditures that should be expensed.
  • Hysteria: After adjustments, rising debt can induce hysteria in which the equilibrium adjustment mechanism promotes additional future adjustment costs.

15. Sets a precedent for future student loan debt

Let’s say the United States cancels all student loan debt as a “one-time” event in 2025 – never doing it again thereafter.

The students who’d amassed the largest amount of loan debt would be celebrating – whereas the students who just finished paying off a $50,000 student loan would feel like they got shortchanged.

Although life is full of “unfairness” and “luck” – why intentionally increase unfairness for all previous generations while giving a random, lucky set of students a massive break?

At this point we mind as well just have students buy into a lottery and one wins a massive payout each week – whereas the others lose a small amount to play the lotto.

One could think of a similar hypothetical unfair scenario regarding social security. You pay into social security your entire working adult life – then suddenly the government decides to no longer issue social security payments. How would this be fair? It wouldn’t.

Moreover, those who accrue student loan debt after 2025 might feel like they’re being treated unfairly relative to those who reaped the benefit of loan cancellation in 2025. These individuals might start violent protests and/or uproars in attempt to get another round of “cancellation.”

  • Note: There are probably a host of other reasons as to why student loan debt should NOT be cancelled/forgiven – I just listed a subset that I’d been thinking about. If you have any additional reasons, feel free to mention in the comments.
  • Note: If you have any relevant counterarguments, feel free to leave a comment as well. I’m open to hearing alternative perspectives.

College degree pyramid schemes…

Pyramid scheme: “a business model that recruits members via a promise of payments or services for enrolling others into the scheme, rather than supplying investments or sale of products.”

Many college students are unknowingly (or perhaps knowingly) participating in a formalized, socially acceptable pyramid scheme by selecting specific majors.

@katiehannigan: “My friend got a degree in Egyptology, but can’t get a job, so he’s paying more money to get a PhD, so he can work teaching other people Egyptology. In his case, college is literally a pyramid scheme.”

Degrees in Art, Astronomy, Communications, History, Earth science, etc. – or more specific things like Egyptology – are relatively useless such that they can only be leveraged to teach to others willing to pursue a degree in that specific niche.

These pyramid schemes would effectively “fall flat” if students made smarter choices and/or colleges stopped forcing students to waste time/$ on irrelevant classes – but these schemes are somehow continuing.

Students & parents supporting “college degree” scams…

Colleges do a great job at marketing themselves to prospective students – such that they convince students that they have the best: teachers; opportunities; entertainment; athletic programs; etc. – all while charging 6-figures per year for tuition.

  • Prestige: People want to say “I went to”: Harvard, MIT, Oxford, Stanford, Cambridge, etc. because it gives them prestige. People think that graduates from these universities are automatically smarter (on average) than those from less prestigious ones.
  • Athletic program: OMG our school is going to have the best “football” or “basketball” team in the nation. It’s going to be so fun to watch all of the games in the student section… LOL.
  • High cost: This is an afterthought to most students and parents. Just get a part time job and you’ll be fine – it’s your dream to have the college experience. Others think that high-cost automatically = better education for some reason.

Most students are selecting colleges based off of sheer “clout” and to improve social status/standing. Others do select colleges based off of offering specific programs, etc. – which is smarter, but still shouldn’t be paid for by taxpayers.

Nearly every student with a massive student loan bill probably could’ve selected a more cost-effective (lower clout) university and gotten a comparable education…

As long as parents continue encouraging students to enroll in cost-ineffective (i.e. highly overpriced) universities – the universities will continue to financially enslave these students to debt for a long-term.

But don’t you want an educated population?

Never said I didn’t. An educated population doesn’t require the population attending college. Many people who are motivated to learn can take free college classes online taught by experts in their respective fields – or pay a small sum to learn an ultra-niche skill.

Remember, merely attending college is NOT of any benefit to society. There’s a massive difference between eternally learning in a bubble (e.g. PhDs jerking off other PhDs) while having limited societal impact – versus going out and working (contributing to society, paying taxes, etc.).

An average delivery driver, fast-food worker, waiter/waitress is contributing a hell-of-a-lot more to society than someone “learning” without actually applying. One could argue that a lot of college learning is unnecessary/excessive and a net negative on society.

Current scenario (Vicious circle): Why there’s massive student loan debt…

  1. Parents convince kids college is necessary for success
  2. Kids select colleges based on clout, location, other BS (not cost & efficiency)
  3. Colleges charge nearly 6-figures to attend 1-year
  4. Students take out loans to pay the university
  5. University continues increasing tuition costs/fees each year & finds new ways to extract as much money as possible from students
  6. Student graduates with massive debt (possibly a useless degree)
  7. Student complains about student loan debt (wanting it cancelled)
  8. Student has kids and convinces the kids to attend college (restarting the cycle)

The universities know they have an ample supply of kids who want to attend college – because a significant percentage of kids are being brainwashed into thinking they need a 4-year-degree to be successful in life.

The kids make stupid choices and pick a college based on their “dream” rather than practicality and cost-efficiency. Colleges continue jacking up rates each year because they have an infinite supply of “suckers” who want the experience.

At zero point do people actually stop and think about whether they’re getting good value for college. As I’ve mentioned before, one could effectively take out a student loan, invest the loan money wisely, work full-time for 4-years, and end up in a better position than someone who graduates from University of Chicago with ~$320,000 in student loan debt with a Theater and Performance or Latin Studies degree.

Student Debt Cancellation (predictive feedback loops)

Let’s hypothetically say that student loan debt is fully cancelled. Will this change anything? No. If anything it maintains the current feedback loops.

  1. Universities fully paid off: Even if students get loans cancelled, the federal government (i.e. taxpayers) ends up covering outstanding balances – and the universities still end up “paid in full” (Eric B. & Rakim style). It doesn’t even matter if the universities charged an outrageous/ridiculous tuition fee.
  2. Parents continue encouraging college (to kids): After all, the government recently cancelled all student loan debt – you’d be dumb not to go to college because they might just keep doing it. Or college might eventually become free! In fact, enrollment in colleges might even increase due to the off-chance that student loan cancellation will happen once every 5 or 10 years or something.
  3. Colleges take advantage: Colleges know that demand has now increased because kids suspect the government will eventually come through and cancel all student loan debt. Behavior of colleges changes such that they:
    • Hire more staff (e.g. administrators)
    • Increase tenure
    • Raise tuition fees
    • Increase book fees
    • Charge more for room, board, food, etc.
    • Spend more on marketing & entertainment (e.g. getting your favorite singer for a concert, public speakers, etc.
  1. Students end up with debt (perhaps more significant): The student loan debt might become even more significant than it was prior to the one-time cancellation due to: (A) more kids enrolling in college in hopes that debt will be cancelled and (B) schools raising rates/fees due to increased enrollment/demand.
  2. Students complain about loan debt: Eventually students complain about student loan debt and it becomes a major political issue and the progressive party vows to cancel it again on a one-time basis. The cycle then repeats itself – or “free college” is enacted by progressives and repealed by conservatives (oscillating back and forth).

What about free college? (Sub-optimal feedback loop)

Not going to get into all of the details, but this is the feedback loop associated with free college that I envision.

  1. Government pays universities: The government won’t be able to negotiate prices with most universities. Why? Because some people will be willing to pay more privately than what the government is offering.
  2. Universities charge as much as they can get away with: Universities will extract as much money as they can get away with from the federal government (who will pay for it all because “free college” is now the law).
  3. Taxpayers continue enriching universities: Universities will continue offering useless degrees, spending inefficiently/irresponsibly, increasing administrative bloat – all while functioning as tax-free entities.
  4. Kids go to college (in higher numbers): If college is free, it’s likely that kids would go to college in higher numbers. This would drive universities to spend more on buildings, classrooms, teachers, etc. – to account for increasing demand.
  5. Pyramid scheme degree reinforcement: Now everyone wants to go to college, colleges need to hire more staff/teachers, etc. – because more kids are attending. They all want a good salary and benefits – all of which ends up subsidized by the government.
  6. Higher government debt: It is likely that the negatives associated with a higher government debt would outweigh the societal benefits of “free college.”

Note: Free college is problematic in other ways including enabling people to waste government tax dollars on useless degrees – such that society reaps zero value from their education that was subsidized by the government. The quality of education might also decrease due to influx of less qualified teachers – and the value of a college degree would decrease – such that a graduate degree would become the new college degree.

Are student loans really a big problem?

Not really. Why? Monthly student loan repayment is usually capped at a specific amount relative to: (A) total debt (i.e. amount owed on the loan) and (B) student loan specifics (repayment term & corresponding APR). (R)

According to education data, a person with a gross income of $64,900 – and a student loan with a 6-year 10-month repayment plan; at 2.75% APR; and $29,500 in student loan debt – would end up paying $393 per month towards student loans (this is ~7% of income).

Someone with a lower income of just $42,500 – and a student loan with an 11-year 2-month repayment plan; at 2.75% APR; and $45,300 in student loan debt – would end up paying $393 per month (this is ~11% of income).

Even after considering taxes, is it impossible to live off of a monthly pre-tax salary of $3541.66 minus $393 in student loans = $3148.66? No. Even after taxes, this individual will have $2000 in tax-free dollars.

Assuming one lives frugally and responsibly, this should still provide a solid quality of life in the U.S.  Moreover, considering things like over-time opportunities, side hustle opportunities, etc. – and most of these individuals can likely pay off their student loans earlier than expected.

Student loans might become problematic if a person wasted time/money on college for something like an art history degree and then is surprised he/she cannot get a high-earning job thereafter with that specific degree to pay off his/her student loans.

Moreover, I constantly read about medical doctors (MDs) complaining about student loan debt – yet they: (A) chose to become MDs and (B) likely have sufficient finances to do whatever they want, live where they want, and enjoy life. Yes, they have a monthly loan payment, but it’s a small percentage of their total monthly income.

Would it be nice to have all student loans eliminated for these people? Sure, they’d love having an extra $1-2K per month freed up to invest or spend on who-knows-what.

How to break this cycle… (Massive Student Loan Debt)

The only way to break the cycle of massive student loan debt and overpriced college education is to make smarter and more practical decisions.

  1. Consider alternatives to college: Consider all other alternatives to attending a 4-year university. Help people realize that college is NOT always a smart move for every person. (For a subset of people it’s a waste of both time and $).
    • Associates degree (2-year): Many people can get good jobs with a focused, 2-year associates degree. Examples: air traffic controller, nuclear technician, web developer, dental hygienist, aerospace technician, police officer, radiology technologist, etc.
    • Apprenticeship: Some jobs may only require a brief apprenticeship. Once the apprenticeship is complete, you’re good to go.
    • Online program: There are many “online programs” in the form of 12-week bootcamps for things like coding – and 4-week certifications for things like personal training.
    • Getting a job immediately after high school: It’s possible to get a job at a variety of places with nothing more than a high school diploma. (Examples: truck driver, janitor, real estate agent, carpenter, masonry worker, etc.).
    • Starting a business: Some people would probably be better off using the money that would’ve otherwise spent on college tuition – towards starting a business.

Note: Although some alternatives may seem less “lucrative” – many people without college degrees enjoy their jobs and can earn a comfortable living. Managing money appropriately and investing should help most people get ahead in society without a college degree.

  1. Only attend college if necessary: If college is necessary to achieve specific occupational and/or financial goals – then go, but accept full responsibility for the decision. It’s your decision to attend college… therefore you should “pay the cost” required. Examples of careers for which a college degree is necessary: doctor, dentist, lawyer, speech pathologist, registered nurse, etc.
  2. Select the most cost-effective university: Rather than going to a “dream” college and racking up debt in exchange for clout, pursue the most cost-effective/time-efficient university. Avoid things like going to a college just because they have a great “football team” – unless all else is equal (e.g. pricing, speed, etc.).
  3. Pursue a future-proof degree (jobs, pay, skill): If you’re in college, pursue a degree that is relatively “future proof.” Think about: (1) pay (what will pay the most?); (2) opportunities (are there a lot of job openings?); (3) what you’re good at/capable of (based on IQ, EQ, personality, skills/abilities) – and make a decision based on these.
  4. Work part-time & scholarships: Anyone who goes to college (and isn’t fortunate enough to have rich parents that pay for their education in full) should work be encouraged to: (1) work a part-time job AND (2) apply for every single scholarship opportunity. This should help decrease the burden of student loan debt to some extent.
  5. Pay off student loans strategically: Consult a financial advisor if necessary to interpret your student loans – and never commit to a loan that you don’t understand. Don’t expect the government to pick up the tab. Accept responsibility for the fact that: (A) you wanted a college degree; (B) you took out a loan; and (C) you chose your specific major (perhaps not thinking about the implications).
  6. Do NOT support the cancellation of student loan debt: This is essentially saying you want your tax dollars to fund a college (already tax-free entities) so they can further enrich themselves with zero accountability (e.g. Xzibit pimping out the library with OLEDs, platinum water fountains, and the kitchen hiring 5-star chefs).
  7. Help young adults make smarter decisions: If you’re relatively aged/old and know some young adults who are considering college, help them weigh the “pros” and “cons” – thinking critically about each before making a decision whether to attend college. Your goal shouldn’t be to convince them one way or another, rather it should be to help them make informed/smart decisions and accept responsibility for any debt they accrue.
  8. Hold universities accountable: For charging high prices, hiring unnecessary administrators, offering straight up useless degrees, requiring classes irrelevant to major, spending irresponsibly, etc. How do you hold universities responsible? Vote with wallet.

Note: I’ve always thought that it could be interesting to have universities start businesses and then employ students with relevant education in those businesses – this way they get a degree and a job right after graduation. This would require innovation though and not wasting money on unnecessary research just for the sake of publishing another theoretical paper in Nature.

What should happen to colleges eventually? (In theory)

If people start avoiding college more often, pursuing alternatives (e.g. trade careers, hyper-focused/niche occupations, etc.) – or if people choose more cost-effective colleges, the others will eventually be forced to adapt to changing demand.

  • Colleges will fire unnecessary administrators.
  • Colleges will eliminate poor ROI classes and degrees (e.g. art history).
  • Colleges will spend money more efficiently.
  • College programs will be forced to become more efficient (eliminating unnecessary classes and enabling quicker graduation)
  • Colleges will only have useful degrees (with job/earning opportunity)
  • Colleges may start doing “job guarantees” post-college – such that if you complete their program (with certain stipulations) – they guarantee you a job (such that you’ll be able to pay off your student loans).

It really all comes down to supply and demand. Right now there are hordes of morons excited to take out massive loans and pay for 4-year degrees from “high-clout” universities for the “college experience” – which is why many people have serious student loan debt.

If people stop pursuing irrelevant degrees (no job prospects and/or low pay) – they (at the very least) should be able to find a job to cover student loans post-graduation. This is actually a good thing. Once the supply of morons dries up – the universities will stop hiring art history teachers to support this type of pyramid scheme.

Final thoughts on student loan debt cancellation…

Student loan debt sucks for anyone that has it. However, it’s not some insurmountable obstacle. Most people can find ways to get a job, pay off the loans, and move forward in life.

Remember, whether you take out a loan for a car, home, boat, ATV, business, etc. – you are expected to pay it back or there will be consequences.

Similarly, if you take out a loan to attend college/university – you are expected to pay it back.  Student loans are actually easier to pay off than other types of loans due to low interest rates.

I’m not sure why students are somehow viewed as being incapable of paying off a student loan… particularly relative to anyone else that takes out a loan for another purpose.

Most Americans are not responsible with spending and don’t think much about the consequences of financial decisions.

This is why the average U.S. family had around ~$6000 in 2021… wherever people are able to get money in advance – they’ll find ways to spend it then act surprised or outraged when collections show up.

People need to learn how to: (A) make smart financial decisions and (B) avoid irresponsible spending. If we “forgive” student loan debt, this is effectively enabling/reinforcing an unfavorable financial dynamic.

Ultimately the worst case scenario is: (A) college debt + (B) useless/irrelevant degree… as this equals (C) wasted time + wasted money + zero job prospects.

Personally I’d rather have taxes cut – or even cancellation of medical debt (as many people with medical issues simply have had bad luck – and these issues interfere with the ability to effectively work/function in society).

Anyways – this was way too long winded, but I had to get my thoughts out.

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