Infographic: Is Higher Education the Next Big Bubble? Part Two
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
Almost two-thirds of all undergraduates in America take out education loans, and the total size of student debt is expected to cross the $1 trillion mark this year. With the weak job market out there, how are students expected to pay off their loans? Is the next big bubble really about to burst?
Almost two-thirds of all undergraduates in America take out education loans, and the total size of student debt is expected to cross the $1 trillion mark this year. With the weak job market out there, how are students expected to pay off their loans? Is the next big bubble really about to burst?
Yesterday, we compared the similarities between the imminent higher education bubble and the 2005 housing bubble in the United States. The similarities cannot be denied, and the biggest difference between the two bubbles is that the higher education bubble is growing at a much faster pace.
Today, students in America graduate with an average debt of $24,000. According to some statistics, 10.8 percent of students from public schools default on their debt within three years. For students from private institutions, the rate of default almost doubles.
Additionally, students are no longer protected from bankruptcy following a new law passed in 2005. This means a student can be declared bankrupt, have a tarnished credit score, as soon as three years after graduation.
To further investigate the next potential crisis, the following infographic breaks down the reality of student loans and the current state of the job market in the United States.
Related Infographic: Obama’s New Plan For Student Loans
Related News: Cost of Raising A Child Has Risen 55 Percent In Less Than A Decade
If you missed part one of the infographic, you can view it here.
