… only student debt grew during the Great Recession. Federal policy has encouraged this habit. In the two years following the financial crisis, spending on student loans grew 19 percent and 18 percent, respectively.
Good debt is an investment that will grow in value or generate long-term income. Taking out student loans to pay for a college education is the perfect example of good debt. First of all, student loans typically have a very low interest rate compared to other types of debt. Secondly, a college education increases your value as an employee and raises your potential future income.
… About one-third of millennials say they would have been better off working, instead of going to college and paying tuition.
That’s a according to a new Wells Fargo WFC +2.06% study which surveyed 1,414 millennials between the ages of 22 and 32. More than half of them financed their education through student loans, and many say the if they had $10,000 the “first thing” they’d do is pay down their student loan or credit card debt.
After the experience of the last few years, I would say it’s not a good idea to generalize that college debt is always “good debt”.
- Amid declining household debt, rising student loans remain a drag on the economy (Cost of College)
- The student loan problem: ‘I’m not going to worry about it right now. I had to take that plunge.’ (Cost of College)