The American Dream has long been the goal for many citizens. Having a successful career and financial stability are parts of this big dream that many have. Part of that dream was often being able to access higher education and the possibility of earning a college degree. However, newer generations are finding that dream getting further and further away. Here is how the exuberant cost of college is hurting new generations in America:
Generation with the most student loan debt
The cost of college tuition has more than doubled since the 1980s and consequently many students are forced to take on more student loans. The cost of college has risen so much that other forms of financial aid such as grants and scholarships are often not enough to cover the cost of attendance. Millennials have much larger student loan debt compared to generations before them. Student loan debt has now hit $1.5 trillion and is the leading cause of debt in America. The rising amount of debt has prevented many young Americans from reaching financial milestones that previous generations were able to reach. Additionally, the increased costs of living keep young Americans trapped in a constant state of living paycheck to paycheck.
Higher Costs of Living
The higher living costs have helped to keep young Americans from being able to attain the financial stability that many of their parents were able to acquire. Just one example of that is the ability to purchase a home. According to the Joint Center for Housing Studies of Harvard University, the price of a single-family home in 2017 costs about 4.2 times more than in 1988. Young Americans are also holding off on starting families as the fear of financially providing for children increases. Although millennials are actually earning more than previous generations, their income has not adjusted to the rising costs of living such as housing and their piling student debt only has made a bad situation worse.
Loss of financial freedom
The rising cost of college has prevented new generations in America from earning financial freedom. Millennials are less likely to have built a personal savings and about two-thirds say they would have difficulty paying an unexpected expense of $1,000. Millennials have lost the ability to achieve financial stability and are missing out on major life events such as purchasing their own home. This loss of financial freedom also prevents them from taking greater risks in their career that could lead to greater rewards. The promise of a paycheck is much more appealing than taking large steps towards their career.
More degrees, more competition
While an obvious solution might be to just forgo college altogether, statistics show that those who earn a college degree still earn significantly more than those that only possess a high school degree. An individual who does not graduate from high school earns about $24,000 less and those who do hold a bachelor’s degree earn about $55,000 on average. Thus, a college degree has almost become a necessity in order to be able to compete in the job market. Young Americans then get stuck in a never-ending cycle of debt as they must earn a degree in order to get higher-paying jobs. However, they end up using most of their income to repay their student debt.
Rising tuition costs leads to fewer options
As tuition costs increase some young Americans are deciding to avoid higher education altogether. However, that leads to fewer options for careers. Some have found that trade schools can often yield a path to a job with lower financial risks but often find themselves in stagnant careers.
The rising cost of college is preventing thousands of young Americans from achieving the American Dream. Young Americans are finding financial stability practically impossible because of the amount of student debt that they must pile up.
Aqib Raja is a Digital Marketer, Outreach Specialist, Guest post link builder and an IT Professional. He loves to write on different topics. In free time, he likes to travel and explore the different parts of the world. You can follow him on Facebook.
Aqib Raja is a Digital Marketer, Link builder and an IT Professional. He loves to write on different topics. In free time, he likes to travel and explore the different parts of the world.