[itsoktocry]

>People were encouraged to take out debt for a number of reasons, and by a number of institutions, without first being educated about the implications of that

18 year olds don't understand what a loan is? Zero accountability?

[p_j_w]

In the United States? For huge swaths of the population that answer is obviously no. Financial education and literacy in this country is a complete fucking joke. Very few people expected that they would be on a payment schedule that amounted to $200/mo for 30 years, and for a significant portion of them, there was really strong messaging implying that getting a college education was the only pathway to financial success, such that student loans were worth it. Two generations and counting have been massively duped.

[bdangubic]

99.65% of 18-year olds 100% do not. or compound interest. the system is rigged against them to not be taught any of basic finacial literacy

[neilc]

Basically all college-bound 18-year olds understand what debt is — you’re infantilizing them to a ridiculous degree if you think otherwise. A lot of them choose to proceed with college due to career optimism and following the herd, not because “debt” is some magical concept that they don’t understand.

[bdangubic]

Basically all college-bound 18-year olds understand what debt is

not to sound snarky but seldom do I read here something more wrong... if they did they would NEVER take on the kind of debt they are taking on in droves to get that paper. "debt" is one thing, you probably understand "debt" when you are a kid... understanding loans however - is an entirely different thing from general concept of "debt"

[neilc]

I suppose we’ll have to agree to disagree. I know lots of liberal arts majors who still have a lot of student loan debt in their late 20s and 30s. They knew what they were doing when they enrolled in college and chose their major, it wasn’t like cost of tuition or what an “interest rate” is was somehow obscured from them or too difficult for them to comprehend. In some cases they regret the choices they made earlier but that’s a different matter, those choices were not made in ignorance of the basic situation they were entering into.

[bdangubic]

We definitely agree to disagree… I am trying to understand your point of view but failing - if they understood the loan and still took on it does that mean that they are just being irrational? or stupid (I don’t mean to sound mean here but lacking a more PC word here…)?

[neilc]

They absolutely understood the terms of the loan. I think they do it anyway because: (1) everyone else is doing it and they don’t have a good alternative (2) career optimism. If you end up becoming a lawyer/consultant/accountant or otherwise have a good corporate job, in the medium-term your student loan debt doesn’t really have a significant impact on your life.

It’s really only a problem if you (1) choose a private college and don’t stay in-state, (2) get a degree which doesn’t have a lot of practical value, and (3) then want to pursue a low-paying field or get a not-useful graduate degree. For example, a friend of mine did her undergrad in art history, master’s in museum studies, and works for a non-profit. She’s not rich but she’s able to survive reasonably comfortably. She’s not dumb or financially illiterate, and she knew what she was getting in for.

[DennisP]

I'm just gonna mention that during the 2010s, Donald Trump had $287 million in loans forgiven after refusing to pay and suing the lender for "predatory lending practices."[1]

But yeah, let's make sure we squeeze every drop out of those college students, they should have understood their loan terms.

[1] https://www.forbes.com/sites/nicholasreimann/2020/10/27/repo...