Colleges tackle student debt
Mercadi Crawford, the first in her family to graduate from high school and the first to go to college, admits she knew little about the intricacies of financial aid when she enrolled at Texas Southern University.
But Crawford, who was raised in a single-parent household, knew that getting to graduation day would require loans.
She could have been on the road to emerging from school saddled with debt. Instead, Crawford got some lessons in financial literacy from TSU’s financial aid department and kept her student loans down to a little more than $10,000.
“I had to learn that you have to give that money back,” said Crawford, now 24 and pursuing a master’s in public administration at TSU. “A lot of students take out more than they have to or need to. It’s not free money.”
TSU is among a growing number of colleges and universities offering financial literacy courses. At the University of Texas-Austin, the non-credit course topics in “Bevonomics” include “Budgeting and Building Credit as a College Student” and “Managing Your Student Loan.” At Rice University, the online “CashCourse” offers lessons titled “Budgeting and Financial Planning” and “Repaying Student Loans.”
Student loan debt has passed the $1 trillion mark, more than total credit card debt. In 2010, two-thirds of college seniors graduated with loans and owed an average of average of $25,250, an increase of 5 percent from the previous year, according to the Project on Student Debt.
At the same time, the unemployment rate for 2010 college graduates reached 9.1 percent, its highest level in recent years. The economic downturn has left many graduates out of work and in danger of defaulting.
On July 1, interest rates on subsidized Stafford loans are set to double to 6.8 percent unless Congress breaks a partisan stalemate.
For colleges and universities, growing student debt has been cause for alarm and action.