Closer Look At Student Loans example essay topic

An Informative Look at a Financially Successful Future College has always been an important step towards getting into a high paying job. Unfortunately, in most states, tuition is on the rise and students who do not come from wealthy homes find themselves a step or two behind. The next step they will take, however, will leave them even further behind the more financially set group. They have to somehow come up with the money to afford their well deserved education. By looking at the cause of rising tuition, grants, loans, and scholarships, it can be easily seen that tuition hikes are directly influencing students's chool performance in a negative way.

First and foremost it is important to understand what is causing the rise in tuition. Richard Vedder of the National Review discussed the outlandish costs of college in an article titled, "A Fortune in Tuition". Vedder found that cost per student rose an alarming seventy percent in merely the last twenty years (par. 1). Surprisingly, this money is not going towards learning. It seems that tuition is rising because of two reasons.

The first is a feeling of need for a better environment. On the average, increased tuition percentages have gone to help finance better buildings and new course offerings. Taking a look from an economic standpoint, it is a simple case of supply and demand. "When demand rises, relative to supply, prices (in this case tuition) go up". (par.

4) Demand for college has made a huge jump in the past few decades; more and more students want to go, and since the arrival of the community college, it's been possible. When looking to pay for higher education, many students first look into grants, most often, Pell Grants. A grant, by definition is a gift of money for a specific reason. This reason is education and the gift giver is the government.

Pell Grants are put into place for students who are considered low-income. Richard Vedder of National Review looked closely at the numbers and found that with Pell Grants diminishing, "Kids without money for college simply borrow it". (par. 3) The norm used to be grants and is quickly turning to more pricey ways. For the past two years the maximum amount a student could receive from a Pell Grant was $4,050.

However, by looking at the average costs of universities, Pell Grants do not provide nearly enough. Adolph Reed Jr. of Academe agreed with Vedder and found that, "Pell Grants now cover only thirty-three percent of the total cost of attending an average two-year college, twenty-five percent of the cost at a four-year public college, and less than ten percent of the cost at a private four-year school". (par. 16) While grants still appear to be a way to obtain SOME financial help when paying for college it has become obvious that no student can attend college on Pell Grants alone. Looking at the Central Michigan website anyone can find out that the estimated annual cost of a Michigan resident to attend their university is $13,520. Meaning that at Central a Pell Grant would cover only thirty percent of a CMU student's tuition. A student working at Little Caesars who makes five dollars and thirty cents per hour would have to work two thousand two hundred and fifty one hours in one year to make up for the rest.

That is seven hours a day three hundred and sixty five days a year. With a minimum twelve credit hours a semester, that doesn't leave much time for homework. Students who do not meet the criteria for these grants however are almost instantaneously forced to look into borrowing money with interest. This has turned many students to looking into loans.

Loans are scary, no matter if the person looking to get the loan is eighteen trying to find the right school for the right price or forty trying to find the right home for the right price. After looking at grants which is money that doesn't need to be paid back and contains no interest, loans are the exact polar opposite. As well as having to repay the initial sum of money interest is added making the amount to be paid back horrendous and that isn't right to do to a student who is just trying to make enough money to get to that next financial plateau in life. A loan is given by individual banks for many different reasons; personal, home, student, and the list goes on. Unfortunately a little thing called interest is thrown into all of this and makes the situation all of a sudden a lot direr. Many students find loans because they will give them the money they need in a large lump sum.

The price tag with interest however is more than any traditional low-income student can afford. Adolph Reed Jr. of Academe studied what direction college loans were headed and found that current republican leaders have also introduced a proposal saying that consolidation loans may no longer "lock-in" the low fixed rates that many newly graduated students depend on. (par. 29) There are, however, people who are trying to think of new and better ways for loans to be paid. Craig Munier of The Chronicle of Higher Education also took a closer look at student loans. Munier suggests that more colleges participate in direct loans which mean's that schools lend the money for lower interest rates.

"Direct lending allows a university to provide the highest level of customer service to its students, rather than delegating that responsibility to third parties whose first priority is their bottom line instead of the student's best interests". (par. 9) While Munier has a fabulous idea Greg Winter of The New York Times Upfront found that on the average students are borrowing about $27,600 for an education. (par. 3) That is so much money that once students graduate, they cannot seem to continue with their dreams of advancing in their field, instead they are just trying to drag their way out of debt. Winter introduced Connie Chavez in his article a twenty-two year old from Hofstra University who borrowed just $10,000 in loans.

She told Winter that, .".. the mere thought of [my debt] has made me for now give up on my dream of going to business school. My sole priority is finishing my senior year, then finding a job that pays well enough to stamp out my debt". So, while there are solutions in sight, the question is how many of our universities and colleges will accept these terms that will help their students. The only real way to truly get all of a college education paid for is through scholarships. Alex Kingsbury of U.S. News & World Report wrote that "scoring top marks is the most lucrative way to earn money for school". (par.

2) He is quite right, with a scholarship, no money has to be paid back and the school pays because of the hard work the student already put forth. A common misconception however often scares students away from even applying for scholarships. This misconception is that you have to have been an honors student to get a scholarship. There are scholarships out there for community service, sports, journalism, grades, anything and everything students are involved in. Scholarships are the only financial help that doesn't force students to forgo their studies and work full time. The students are being rewarded for their performance in high school by being given the opportunity to perform well in college, for free.

Unfortunately this still cannot afford to be the choice for everyone. Students who find themselves unable to receive a scholarship are in rough shape, henceforth, few high school suggest students rely solely on a scholarship they " ve applied for. Even so, a lot of scholarships are not full rides or only pay for classes not living conditions. So still, students are being asked to take away from their study and school time to work, or to participate in an activity they were given a scholarship for. Anyone who has ever considered higher education has wondered how they would pay for it.

Mark Rafenstein found that, "more than half of all full-time college students hold jobs". (par. 4) Professors say that students should spend at least two hours of homework time per one class hour. If a student is taking the minimum twelve credits to be a full time student that is twelve class hours plus twenty four study hours a week. Add forty hours of work to that and the student has already signed off to seventy six hours of their week. If they manage to get eight hours of sleep a night, that means that they " ve used one hundred and thirty two hours of their one hundred and sixty eight hour week. If a student took the time to crunch these numbers before they applied to school and saw that they would only get thirty-six hours of free time a week and end up with thousands of dollars in debt it would make sense that fewer and fewer students would choose college as their course in life.

Because of hikes in tuition, it has become financially unacceptable to stay in a program more than four years before pulling out of the system in order to repay what they " ve borrowed. This current way of dealing with students educational fees have to change before the strongly rooted education system in America crumbles with their student's credit report. Work Cited Central Michigan University Financial Aid Department... Kingsbury, Alex. "Yes, your grades mean a lot; Doing well in class can mean doing well In the financial aid stakes". U.S. News &World Report. 6 September 2004: 72.

Rafenstein, Mark. "Working Your Way through College". Career World. Jan 1999: 26- 27.

Reed Jr., Adolph, and Sharon Szymanski. "Free Higher Education". Academe. Jul / Aug 2004.

Vol. 90, Iss. 4. pg. 39, 5 pages. Vedder, Richard. "A Fortune in Tuition". National Review.

New York: Oct 11, 2004. Vol. 56, Iss. 19; pg. 38, 3 pgs. Winter, Greg. "Drowning in a Sea of Debt". New York Times Upfront.

March 7, 2003. Pp 12-13.