They Owe As Off to School They Go: College Students Take on Loan Debt of Five Figures; Burden is Mushrooming

By Carol Biliczky, The Akron Beacon Journal, Ohio

May 28–Consider Lakitia Avery, a 24-year-old graduate student at the University of Akron.

She racked up $40,000 in debt as an undergraduate and is piling on another $20,000 as she earns her master’s in higher education administration.

She expects it will take her 25 years to pay it all off. But even that will be a challenge, given that she expects to make only $35,000 or so in her first job as a college administrator.

Avery’s plight is far from unusual in Ohio. The average public college graduate ends up owing $16,000, but one in 10 ends up owing twice that. At private colleges, the debt is $23,000, and for one in 10 students, it balloons to $40,000, according to the nonprofit Project on Student Debt in Berkeley, Calif.

More bad news is in sight: Tuition is climbing, and the cost of borrowing money through government programs is rising by 1.5 to 2 percentage points in July.

“There’s probably not an end in sight,” said David Creamer, vice president of administration at Kent State University. “As a society, we have to decide if it’s a good idea to place that much debt on people as they begin their professional lives.”

Ohio has faced a perfect storm in higher education for more than a decade.

Tuition and fees consistently outpaced inflation. College officials say it’s expensive to run a business with huge personnel costs, escalating health care costs and the need for ever more modern technology.

And although state aid to Ohio’s tax-supported universities increased by 27 percent in the last decade, the national average was a 50 percent increase, according to the University of Illinois Center for the Study of Education Policy.

“We are the face of the system that’s broken,” said Doug McNutt, director of financial aid at UA, whose office faces bewildered parents and students facing sticker shock.

This fall, the average cost to attend a four-year state college in Ohio will rise 6 percent to about $16,000. Private colleges typically charge about $25,000 a year, although $40,000 isn’t unusual at the most exclusive schools.

Students’ options

Because few families can afford that, many students work. Some get scholarships and grants. Two out of three are in debt; the average debt of a college graduate grew by half in the last decade when adjusted for inflation, according to the Project on Student Debt.

Last year alone, the average Kent State student took out $7,350 in college loans, 6 percent more than the year before, said Mark Evans, director of student financial aid.

One of the borrowers at Kent State is Andrew Schiller, a journalism and mass media student who has borrowed about $8,000 to get through his sophomore year.

He took a year off between his freshman and sophomore years to work: first at a factory job he hated, then in computer support, where he made $13 an hour — excellent money by college student standards.

He also said he’s frugal: He doesn’t go to movies, isn’t big on clothes and can go “a long time” without buying incidentals.

Still, he expects to owe as much as $20,000 by the time he graduates.

“I wish that wasn’t the case,” said Schiller, a resident of Lebanon, Ohio. “I figure I’ll have to bite the bullet for about 10 years after I graduate. I’m scared to death of getting married.”

Borrowing from parents

Michael Quigley of Boardman is borrowing almost all the money he needs for his education. He has the luck to be getting the loan from the most generous of lenders: his parents, who aren’t charging interest.

He also managed to save enough money in childhood to pay $7,000 in cash for his first semester.

He works during the school year at a campus job and is looking for a summer job — one that will mesh with his unpaid internship in the Youngstown office of Democratic U.S. Rep. Tim Ryan.

Still, Quigley expects to owe $50,000 — albeit, to his mother, a teaching assistant, and his father, a retired cement-plant worker — when he graduates with a degree in political science.

That gets under his skin. “I think it’s unfair that we’re asking this generation to start out with upwards of $50,000 in debt,” he said.

In the recent past, college degrees paid off. Graduates earned about 80 percent more than high school graduates, twice the gap of 40 years earlier, according to the Center for Economic and Policy Research in Washington, D.C.

Avery, the UA grad student, is counting on that as her debts mount.

“It’s there. There’s nothing I can do about it,” she said. “It’s scary. But at least I’ll have a degree.”

Carol Biliczky can be reached at 330-996-3729 or cbiliczky@thebeaconjournal.com

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Copyright (c) 2006, The Akron Beacon Journal, Ohio

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