Am I missing something on this 10k loan forgiveness?
I'm totally against this loan forgiveness but I'd still rather have saved and paid off all education costs than get this "free" money.
If I have loans for 40, 50, 60K+ then they will drop to 30, 40 or 50K but I'm still in debt. If I saved and paid the whole cost, I'm out of debt even though I missed a free 10K. I'd take the latter situation.
53 Replies
3y
like I am now.
I'm in the bracket that should benefit. I won't say no if offered. But to those saying we're going to all be paying for it in our taxes, we haven't had a balanced budget in decades. We borrow money to spend on everything. Fiscal responsibility is important to you right now all of a sudden?
I would be fine without the money but I do think eliminating interest would have been a better solution. That's the crippling part for people that ARE struggling with student debt.
(In response to this post by coshokie)
3y
that takes a loan (for anything) irresponsible? Just because I have a loan doesn't feel like I'm irresponsible. If its for college versus a big screen TV I'd say that was more responsible. Confused I guess.
(In response to this post by coshokie)
3y
Most people who stand to personally benefit from this particular bit of policy are either true believers or can at least rationalize an argument about why it's a not the end of the world.
Most people who do not stand to personally benefit, think this is the worst thing since Hitler and is a clear sign of the impending Apocalypse.
If you would like to borrow this template and apply it to LITERALLY ANY OTHER POLITICAL ARGUMENT EVER, feel free to do so.
(In response to this post by UTPr0sim)
3y
plenty of responsible people have all sorts of loans. My point was I'd rather have saved and owe nothing than get a free 10k removed from a loan but still owe. Neither one is irresponsible. Seems some that saved and paid everything themselves feel like those with loans are getting everything paid off for them. Yeah, its 10K you don't get since you saved and paid but its not like everyone with loans are getting them paid off.
(In response to this post by UTPr0sim)
3y
...the answer is "depends".
(In response to this post by UTPr0sim)
3y
and our culture in general about the importance of college. And entire generations have been brainwashed into thinking they will be a failure or end up working some "crappy" blue collar job (perish the thought) if they don't go.
But on the other hand, people need to be held responsible for their bad decisions. Getting that $100k sociology degree was your choice and now you have to live with that. And as somebody who paid off their student loans less than 10 years ago this really sticks in my craw.
(In response to this post by coshokie)
3y
And that got turned into this straight line argument go to college and you will make more money.
And that used to be true b/c college grads DID make more but way fewer people went to college and yes they tended to be higher achieving people to begin with. So the logic was a simplistic "Send everyone to college and everyone will make more money"! what I call the straight line fallacy, ie the straight line eventually breaks down. Sadly, college has become for many what high school should have been.
So yeah the lie is "Just go to college and everything will work out" when maybe the truth would be to find out what you're good at and that might be as a machinist. (and actually there are some very sophisticated machinist jobsj out ther your know, eg running computers.)
(In response to this post by HokieNoVA)
3y
It was instilled from a very early age that going to college was the only way to make a living in life and if you wanted to “flip burgers” for the rest of your life, then don’t go to school and be a failure. I remember saying to my parents that I was considering something else and you thought a bomb had detonated in the neighborhood.
Later here in life the wife and I have discovered there are alternate paths to success and hate the fact we both were told the same story. She would have done something completely different if she knew what she knows now.
** Edited by GSOHokie01 at 8/25/2022, 12:49:23 PM
(In response to this post by HokieNoVA)
3y
In the world my parents grew up in, a college degree...ANY college degree...made you darned special. And that's what Gen X was told.
Then we went to school in droves. And quickly found out that some college degrees make a big difference, while others don't. But we were sold on college degrees so hard, that's what we taught our kids (the Millennials).
Meanwhile the cost of college has risen faster than inflation for literally 40+ years now. If a Gen X'er went to college and got a useless degree, it was a mistake, but wasn't necessarily a life-altering and crippling (at least financially) choice. They were starting life with about a car loan worth of debt. Not great, but not horrible. When a Millennial goes to college to get a useless degree, they get to start life with the equivalent of mortgage debt and no way to get a positive ROI.
(In response to this post by HokieNoVA)
3y
College certainly has its purpose and value...but for a good, good number it's not worth going into 5-6 figure debt for in your early-mid 20s. There are other avenues that can be just as rewarding, and better choices financially.
(In response to this post by HokieNoVA)
V
VTUD
3y
against this $10k loan forgiveness,even though my son qualifies. I payed for his undergrad,but he took out loans for law school. He made about $115k in 2021,which qualifies him. He received a big raise to $155k when he switched law firms in 2022.
These kids signed a contract to pay back the money they were loaned. They should do it. With a very low unemployment rate,there are plenty of well paying jobs in the market place. So,there is no valid excuse not to pay back their loans. I came out of grad school in 1980 with unemployment rates and inflation running in the double digits. Yet,I sacrificed and payed back the loans I had taken out.
What about those that never attended college? Only about 38% of the U.S. population have college degrees,yet they have to pay for those who don`t want to pay back their college loans.
We are currently living in a nanny state where too many people expect government to take care of their every want...and the current government is more than willing to do it.
(In response to this post by coshokie)
3y
Then let people pay it off. The inequities of forgiving $10k are great, and it penalizes responsible people. Don't get me wrong. Some students were misled, no doubt. But the great majority made multiple decisions around choice of college, choice of major, choice of finance that went into their debt. Why do they now benefit while people who made good decisions don't?
(In response to this post by coshokie)
3y
should make off of loaning you the money should come from increased tax revenues from a lifetime of higher wages. The govt is double dipping with the interest and with the higher tax revenue.
(In response to this post by WestyHokie)
3y
I guess if you measure success by how much more money a "responsible" person has compared to an "irresponsible" person, if that gap is reduced the "responsible" person is being penalized some how. Sorry, but that is a really twisted way to view the world.
I was lucky enough to graduate with around $50,000 in loans that were paid off on schedule over 10 years. Had I been born 20 years later & followed the same process in 2016 that I did in 1996, I'd be saddled with closer to $200,000 in loans. (direct inflation would have made those loans $85-90k) No less "responsible" yet buried in a much deeper hole. That is what this loan forgiveness recognizes - the system has screwed people who attended college in the past 10-15 years. There were not many alternatives. Yes it's a band-aid, but a band-aid is still better than letting the wound keep bleeding completely unchecked.
(In response to this post by WestyHokie)
3y
All this does is mop up the mess on the floor.
College costs are still increasing. Student loans are still cheap and easy to get. Today's students are digging a hole every bit as deep as yesterday's.
(In response to this post by ShockWaveVT)
3y
pitched and taken out through Discover, Chase, etc. that are really just high-rate personal loans that they slap the name student on to make it sound like the government or school might be involved. The only thing they have in common with a federal student loans is that you can't bankrupt them either.
(In response to this post by Beerman)
3y
Yep, I'm pulling out the "back in my day..." When I went to college in the mid-1980s, my family had no money. Divorced parent, not a great job. So I had choices. I was accepted to Roanoke College. Even was offered a scholarship. But even after the scholarship, it was $11,000 a year - way too much for us. I had wanted to go to the U. of Tenn, but also way to expensive. So I went to NVCC for 2 years, then transferred to VT. I took overloads most quarters to graduate within 4 years today (several quarters I had 18 credits, 6 classes, one time I had 21, 7 classes, and had to get special approval from the dean).
I graduate in 4 years, with no student debt. Because of choices I made. I didn't like some of them but I didn't think me going into debt and having others pay to for me as "forgiveness" was a realistic option. That's what happening now. I paid my own way, and I am currently paying my kid's way in college. No loans. I saved for years, and I am sacrificing now. I went into *journalism,* for Pete's sake. You see a lot of money there? I'm not "lucky enough to have money." And NOW I am paying for everyone else who gets $10,000 forgiven, through taxes. THAT is the penalty.
** Edited by WestyHokie at 8/25/2022, 1:25:14 PM
(In response to this post by ShockWaveVT)
3y
What do you think of the decision to forgive PPP Loans?
(In response to this post by WestyHokie)
3y
"First Draw PPP loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement: Employee and compensation levels are maintained,The loan proceeds are spent on payroll costs and other eligible expenses, and at least 60% of the proceeds are spent on payroll costs."
The intent of the loans was to keep business running and people employed. That was for the greater good of the economy and to support people who were working.
If college loan forgiveness came with similar conditions, then they would come closer to consideration. Say, to qualify for college loan forgiveness the student must have had no less expensive option for school in their major, chose a major that data shows makes a specific minimum amount of annual salary on average and that the student agrees to work part or full time upon graduation for x years.
This would at least reduce the pool to students who had few other options to get a degree that would pay enough to help them pay down their student loans.
I still think freezing interest makes the most sense and would be far easier. That could save some students far more than $10,000, ultimately, and also still require they pay back the debt they took out.
(In response to this post by ShockWaveVT)
3y
sell this as 'fair'. There is absolutely NOTHING about this that is fair. I understand that life isn't fair but this is a crappy decision with nothing but November 8th as a real justification. They even know it won't ever get enacted because it is patently illegal. They simply don't care.
(In response to this post by WestyHokie)
3y
every parent who saved for their kids' college so they wouldn't have to get loans. It penalizes every student that worked their way through college, attended community college, etc so they wouldn't have to take loans. It penalizes all of those folks who decided to join the military to help pay for college. It penalizes those that decided college was too expensive so they took a trade job or invested to start a business (that COVID restrictions may have recently destroyed). It punishes minorities who are statistically far less likely to have gone to college.
ALL of those people will be paying this $500B giveaway.
The good news is that the lawsuits will be coming very soon and this will never happen. But mission accomplished because that won't get decided in the next 80 days.
(In response to this post by ShockWaveVT)
3y
so yes, others are picking up the tab.
(In response to this post by ShockWaveVT)
3y
Makes it easier to pay off and shifts the hit to the people who probably did the most screwing over
(In response to this post by WestyHokie)
3y
than 10K a year prob- now it's 30 for in state public - the fed money makes it too easy for schools to jack up prices- and they do
(In response to this post by coshokie)
3y
and be honest about it. Schools still got paid so it doesn't go away it just gets transferred to other Taxpayers. Not sure how much it helps the current administration since half the people are against it and the other half say it's not enough. I guess time will tell if it holds up...so much for lowering the deficit.
(In response to this post by coshokie)
3y
basic economics. The cheap availability (not to mention the fact that it has no impact on now) of money means people will pay whatever it costs, thus increases in costs don't dampen demand. Until the cost increase dampen demand, the costs will go up, and demand won't be dampened until the availability of cheap money that maybe you have to pay sometime is removed.
(In response to this post by Hokiehouse7)
3y
from first hand experience way, way back in the 90s how corrupt student loan servicers were/are. It's gotten a lot worse since then. Also, the real culprit is the extreme cost of schooling.
(In response to this post by Hokiehouse7)
3y
(In response to this post by RhinoVT)
3y
and not so much for the students. I think we've created this academic aristocracy and guess what kind of public policies will those academicians support in the future? Makes a nice little circle jerk. Paradoxically, with all the free money the extreme cost of schooling becomes more extreme, it's not that student loans can't keep up with with rising costs, it's creating those rising costs.
The bigger problem though is the moral hazard issue. You need people to think wisely about life decisions and free education works against that in a couple ways by deferring those hard choices and wasting money to do so. Pay off the student debt? They still wouldn't have a life skill that pays cash money.
** Edited by `lag at 8/25/2022, 10:49:08 AM
(In response to this post by RhinoVT)
3y
socialists love cashing in
(In response to this post by `lag)
3y
use it or lose type of budget. It doesn't stop growing.
(In response to this post by bigbadbird)
3y
You have government interference in what should be free-market controls. My VT engineering education was about $16k including room and board. It's almost that per year now. Are you telling me that the value of a VT education has quadrupled+ in 16 years?
No, when funds are there without any real risk analysis or considerations, price will go up. Here's what should really happen:
Interest rates should be grade and major based and tied to the ability to "become a taxpayer." Student loans are a gov't investment into future taxpayers. If you're in a major with a 90+% in-major employment rate, you should have have the lowest rates. Likewise, you should get a discount for As and Bs. That way if you want to take underwater basket weaving where 1% get a career in field, you'll have to know the cost up front and get hammered for screwing off. If you're taking engineering, business, communications, elementary education, etc. where there's a good chance you'll become a valuable taxpayer, you get a 0% rate. Screw off and you get a 1-4% rate.
Education shouldn't be a time to find yourself and "follow your passion." If your passion is a marketable skill or service, then sure. If your passion is really just a fancy hobby, it should be treated as such.
(In response to this post by RhinoVT)
3y
that degree, based on those expected future earnings and job placement prospective. There's a reason a Lexus costs more than a Toyota, why shouldn't an English degree cost less than an engineering degree? Certainly there's a 'base' cost of going to college but the total cost should reflect the total value....and that probably means paying professors in different fields accordingly as well. The kids who plan to pursue well paying jobs are likely to be able to pay back the higher principal without much issue where the kids who plan to become teachers, social workers or other low paying, but definitely important jobs in society aren't burdened with crazy loans they can't afford to pay back.
Slightly different note, I heard a podcast recently where some companies / schools are taking a new approach to college loans....instead of a traditional loan, they fund your college and in return you have a to pay a percentage of your salary back to them for a certain number of years. It's a higher percentage and / or longer for less valuable degrees so they get their money back. Yeah it sucks to have to give up a portion of your paycheck but you're never truly in debt. I'm sure it has it's own issues but seems like a good option for some, especially those from lower income backgrounds where savings / loans are not really an option.
** Edited by ME Hokie 07 at 8/25/2022, 12:57:17 PM
(In response to this post by hokiehunter07)
3y
You want more engineers, business majors, teachers, etc. People that are going to give back to society through taxes or service. You don't want Starbucks degrees and you REALLY don't want people to get an expensive degree in a field only to get a trade job in another. We need to disincentivize degrees with little hope of future earnings or impact and point those people towards a trade that lets them use their skill or pursue opportunities without racking up 10s to 100s of thousands in debt.
I'm sorry, you can blame the school or loans, but getting a $100k plus loan to study a musical instrument at an Ivy League school s beyond stupid on the part of the individual seeking that "education."
The point of loaning money is to get a return on your investment. Investing in major future taxpayers makes sense. Getting all you can out of an idiot pursuing a worthless major with a high interest rate is perfectly acceptable to me.
(In response to this post by ME Hokie 07)
3y
access to student loans is supposed to encourage (or at least enable education for those who want to pursue it)
the problem is that the system isn't set up with enough checks & balances
your thoughts about interest rates based on major or academic performance are one avenue to implement some balances.
another might be a cap on per-student overhead expenses at colleges eligible for participating in the federal loan programs
(In response to this post by hokiehunter07)
3y
It can consist of way more than just sitting in a classroom in some stone clad building.
(In response to this post by ShockWaveVT)
3y
out of bed and back home after a 0.0 GPA. Hope he enjoyed his experience smoking weed by the Duck Pond all night and sleeping till 2pm.
(In response to this post by hokiehunter07)
3y
academia- we were told what we would make for starting salaries .... and we started about half of that - it was prob the starting salary downtown DC or Chicago- but not normal America..... and then taxes- ya know - there a few items that come out of that fantasy starting salary
(In response to this post by pburg_hokie)
One reform idea: Strictly scrutinize degree requirements for jobs.
Engineers and doctors need degrees. You don’t need a degree to work at a high level in many other jobs; yet those jobs require degrees. That should change. Opens up more career possibilities to young people without ruinous debt.
Other reform possibilities:
Require universities to have some skin in the game. Pony up a percentage of their endowment to the feds as a taxpayer offset for all the government money that has flowed into their coffers.
Tie loan amount totals (student loans, Parent Plus loans, everything) to earning potential.
Fine schools whose students default above a certain percentage.
Make community college and trade schools more appealing. (This admittedly will require a change in parents’ and students’ mindsets. Not something that can just be legislated.)
(In response to this post by hokiehunter07)
3y
Something like the funds you can borrow are capped at x% of the median starting wage for those with the degree you're pursuing.
If you want an English degree, that's fine. But you don't get to borrow a lot of money to do it. If you want an Engineering degree, that's also fine, and you can borrow more money to do it, but you still gotta think long and hard before going to a private or out-of-state school.
Letting anyone borrow any amount of money to major in anything anywhere they choose is broken.
(In response to this post by RoswellGAHokie)
3y
(In response to this post by hokiehunter07)
3y
(In response to this post by bigbadbird)
3y
(In response to this post by bigbadbird)
3y
this board!! Excellent thoughts behind that. I can see giving some other careers that aren't high earning but 100% in need a 0% interest, too. Teachers like you mentioned, cops, school counselors/social workers. Someone like me, PSCI major, well . . . I knew grad school was in my future if I wanted a future. I think better educating kids in High School about the real world and the job market would also be of great benefit.
(In response to this post by hokiehunter07)
It's $10k off of interest too
It's not off your principal. It's also $20k if it's a Pell grant. For some, it will end their payments, but most, like you said, will just lessen the total.
Had he wanted to affect change, interest would be wiped out, or capped at a manageable level. A lot of people are stuck with loans because of the crazy interest, not because they can't make payments.
(In response to this post by coshokie)
Dependent undergrad students can only borrow a small amount each year.
So a lot of them have $10K in debt or less that will be wiped clean. Parent Plus loans are also eligible according to reports I’ve read. And maybe graduate loans too.
It’s the sop that keeps sopping.
(In response to this post by coshokie)
3y
medical school or something. The amounts you can take are not that high. I ended up doing the home equity route when rates were good and you could deduct so I never tried for these loans.
(In response to this post by RoswellGAHokie)
3y
** Edited by B777Fr8Dog at 8/25/2022, 9:53:19 AM
(In response to this post by coshokie)
3y
Question 1. Did the Government claim that COVID was 'over' in May when you overturned Title 42 at the border?
Answer: Yes
Question 2. How can you now (three months later) say that COVID is the 'wartime level emergency' to justify forgiving more than $300B worth of loans? Note that two weeks ago the CDC removed all COVID restriction including social distancing.
Answer: Uhhhh.
However, it will certainly get appealed multiple times as a stalling tactic.
(In response to this post by B777Fr8Dog)
3y
Like with the Covid eviction moratorium
(In response to this post by vt90)