Household student debt on the rise

4 months 6 days 12 hours ago Thursday, May 18 2017 May 18, 2017 Thursday, May 18, 2017 1:55:00 PM CDT May 18, 2017 in News
By: Evan Lachnit, KOMU 8 Reporter
loading

COLUMBIA - Student loan debt is higher than ever and student debt now accounts for nearly 11 cents of every dollar of debt for households. 

That is according to the Quarterly Report on Household Debt and Credit from the Federal Reserve Bank of New York. 

The report shows the amount of student loan debt per household has tripled over the last 15 years. 

1.34 trillion dollars of household debt comes from student loan debt. That is about 10 and a half percent of the total 12.73 billion dollars of household debt.

Overall, household debt surpassed the levels seen during the economic recession in 2008 in this latest report. 

Joe Haslag, who is an economic professor and Kenneth Lay Chair for economics at MU, says despite the rising levels of student debt, going to college is still worth the expense. 

Haslag says when you compare students who forgo four or so years of income to go to college to students who work right away out of high school, historical averages show students who went to college get a return on their investment. 

"The extra income earned by a college graduate converted into what it is worth today is about 600,000 dollars at least," Haslag said. "So if it costs a couple hundred thousand dollars to go to a university even, it would seem like it well it is worth it." 

Haslag said the student loan market does not work like most markets do. He also said he does not think the risk is properly included in the price of interest rates for student loans.

The Federal Reserve Bank of New York report said delinquency rates for student loan debt "are likely to understate effective delinquency rates because about half of these loans are currently in deferment, in grace periods or in forbearance and therefore temporarily not in the repayment cycle." 

"There is evidence from the Federal Reserve Bank of New York study which suggest that even liberal arts majors are getting a pretty good rate of return on their college experience, on average," Haslag said. 

He said based on the average returns seen, the real question is why more people do not go to college. 

"Of course that would alter the supply of college educated grads and probably drive down the wages that are earned by college educated grads and that college premium would begin to shrink if everyone got a university degree," Haslag said. "But right now you could make the case it is well worth going to an university." 

This comes as there is a proposed 2.1 percent increase in tuition for resident undergraduate students for all four UM campuses. 

 

 

More News

Grid
List
COLUMBIA - Charity bikers gathered in Centralia today to show support for a young sexual assault survivor. At least... More >>
1 hour ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 7:05:00 PM CDT September 23, 2017 in News
COLUMBIA - Cooper's Landing had its first Rock n' Roll River Festival Saturday, where families enjoyed food, a fun atmosphere... More >>
3 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 4:35:00 PM CDT September 23, 2017 in News
CAMDENTON - The goal of the seventh annual Lake of the Ozarks Air Show on Saturday was to salute veterans.... More >>
4 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 4:14:00 PM CDT September 23, 2017 in News
JEFFERSON CITY - The Central Missouri chapter of Parents of Murdered Children and Missouri Missing hosted a memorial picnic Saturday... More >>
4 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 3:55:00 PM CDT September 23, 2017 in Continuous News
JEFFERSON CITY - Missouri has one of the lowest enrollment rates when it comes to the 529 College Savings Plan.... More >>
5 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 3:28:00 PM CDT September 23, 2017 in News
COLUMBIA – Today MU, Auburn, Clemson and LSU are announcing their partnership in the U.S. Tiger University Consortium. Clemson president... More >>
5 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 3:16:00 PM CDT September 23, 2017 in Top Stories
EVERTON (AP) — Missouri school districts that adopted a four-day school week in recent years are not finding the savings... More >>
6 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 2:14:48 PM CDT September 23, 2017 in News
KANSAS CITY (AP) — A school district in Kansas City is praising a bus driver for safely getting 34 children... More >>
6 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 2:10:35 PM CDT September 23, 2017 in News
ST. LOUIS (AP) — An undercover police officer and an Air Force lieutenant were among the 120 people who were... More >>
6 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 2:07:00 PM CDT September 23, 2017 in News
BOONE COUNTY - The Latter House Kingdom Ministries of Columbia will host their tenth annual Fall Festival today at the... More >>
12 hours ago Saturday, September 23 2017 Sep 23, 2017 Saturday, September 23, 2017 7:59:00 AM CDT September 23, 2017 in News
ELDON - The people of Eldon are rallying around a family whose son suffered a spinal injury during football practice... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 7:31:00 PM CDT September 22, 2017 in News
COLUMBIA – A local gym held a fundraiser Friday night, and all it asked for was five minutes. But... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 7:03:00 PM CDT September 22, 2017 in News
BOONE COUNTY - One person is dead and three more are injured after a two vehicle crash on I-70. ... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 5:53:00 PM CDT September 22, 2017 in News
KANSAS CITY (AP) — Planned Parenthood is asking the U.S. Supreme Court to vacate an appeals court order that slowed... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 5:47:00 PM CDT September 22, 2017 in News
JEFFERSON CITY (AP) — Gov. Eric Greitens will begin his first trade mission Saturday when he and First Lady Sheena... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 5:20:15 PM CDT September 22, 2017 in News
COLUMBIA - Thirteen-year-old Jackson Morton was diagnosed with cancer in December 2016. "You can't even describe the emotion at... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 4:58:00 PM CDT September 22, 2017 in News
COLUMBIA - Jefferson City Public Schools Superintendent Larry Linthacum released a letter addressing the three students who posted a picture... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 4:05:00 PM CDT September 22, 2017 in News
COLUMBIA - The Missouri Orthopaedic Institute is now offering a free sports clinic called Friday Night Lights. Sports physicians... More >>
1 day ago Friday, September 22 2017 Sep 22, 2017 Friday, September 22, 2017 3:15:00 PM CDT September 22, 2017 in News
Columbia, MO
Broken Clouds 81°
9pm 77°
10pm 76°
11pm 76°
12am 75°

Select a station to view its upcoming schedule:

Coming Up Next

7:00p
Dateline NBC
9:00p
Saturday Night Live
10:00p
KOMU 8 News @ 10
8:00p
Bob's Burgers
8:30p
Bob's Burgers
9:00p
KOMU 8 News @ Nine on The CW

Tonight's Schedule

7:00p
Dateline NBC
9:00p
Saturday Night Live
7:00p
Family Guy
7:30p
Family Guy
8:00p
Bob's Burgers
8:30p
Bob's Burgers
9:00p
KOMU 8 News @ Nine on The CW
9:30p
Seinfeld