Monday, April 21, 2014

Pros/Cons Of Taking Out Student Loans To Attend College

Many people believe a college education is the key to achieving maximum financial success in life. However, the vast majority of families in the United States do not have the means to send their children to college without some type of help. Years ago, the US government set up a program to help families send their kids to college and at the same time allow the cost of that education to be paid out over time rather than one semester at a time. For some - student loans are the answer to a prayer, while for others they are the beginning of a long nightmare. So what are some of the pros and cons of taking out student loans to pay for a college education? The biggest thing on the pros side is the ability for children from poor to modern income families to be able to pay for college. Another benefit of having student loans available is that it increases the number of university choices for students. Many of the better colleges in the United States are also the most expensive. Student loans make those higher priced universities available to a larger group of people. So, what are the cons of taking out student loans to attend college? The biggest thing on the cons side is the sheer size of the debt many young people take on even before they start their first job. It is not unheard of for many students to be in debt $100,000 or more when they graduate from college. Another huge con when it comes to student loans is the fact that the federal government provides financial guarantees to the banks who make those loans and if for some reason a student cannot or will not replay the money plus interest, the US government becomes that banks collection agency and recovers that money from future tax refunds and other sources. There are many more pros and cons to taking out student loans, so take your time and make sure of what you are doing before going into debt which could take you decades to get free from.

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