Increasing Student Loan Rates: What Are the Other Options for Students?
Student Loan Rates to Double from 3.4% to 6.8%
Recently, the law passed by the US Congress granting a one-year extension to fix the interest rate for student loan repayments to 3.4% has already lapsed. This means that effective July 1, 2013, instead of the usual 3.4% interest rate levied against the student loans, the rates automatically becomes 6.8%!
Thus, for example a new college student intending to take out a $23,000 student loan taken after July 1 will have to repay the government after leaving school $265 per month at 6.8% interest rate. The monthly payment is $39 more as compared when the loan was secured under the old rate of 3.4% (Phillips, 2013). An insignificant amount for the established employee but for the recently hired employee who is just starting his or her career this can be a burden.
Traditional Approach to Education
Getting a US college education is a tough balancing act especially for prospective students coming from the lower economic levels. The need to secure a good college education and training is a given if one has to secure a well-paying job later on. Yet, the cost of traditional college education is well beyond the reach of most students and their families to afford. Given the financial limitations of most students and their families in securing a college education, how then can they expect to land a job in the future?
The US government has already offered a solution to this dilemma through the subsidized federal Stafford loans. Named after Sen. Robert Stafford, a Republican from Vermont, this form of student loan is provided to eligible students enrolled in higher education institutions like colleges or universities.
While the students are still enrolled, whether in a full-time or part-time basis, the government does not expect payment for the loans secured. Instead, a grace period of six (6) months after leaving the school by means of graduation, withdrawal or dropping is extended to the students. After this deferment of payment period, the concerned student is now required to repay the loan usually on a 10-year repayment terms. This is because the student is already expected to have a job and a salary that can pay back his or her loans.
Options for Students from Low-Income Families: The Non-Traditional Way
Getting quality education and obtaining a decent job is what everyone wants. Despite the education loan increase, a good quality education and training is still possible given the many options available to students these days. A student should not just fix his sights at the traditional way of learning but also must expand his horizons by way of the non-traditional route.
One such non-traditional option is e-learning where the costs of obtaining quality and relevant education and training is definitely lower compared to getting education from traditional colleges or universities.
E-learning involves the use of computers, virtual classrooms and the concept of microteaching in imparting knowledge and skills to the students. Professional coaches or mentors are readily available to teach students the lessons they really need to know and the skills they need to learn so that these can immediately be applied at work and the students can immediately earn income from them.
Get to know more what e-learning can do for you. Visit MicroTeachings.com for more details. We can help you become the professional you want to be and get you the job and salary that you really want for you and for your family.
Reference:
Phillips, M. (2013), US student-loan interest rates just doubled because congress went on vacation: 10 things to know, Retrieved July 2, 2013 from: http://qz.com/99347/us-student-loan-interest-rates-just-doubled-because-congress-went-on-vacation-10-things-to-know/
Recently, the law passed by the US Congress granting a one-year extension to fix the interest rate for student loan repayments to 3.4% has already lapsed. This means that effective July 1, 2013, instead of the usual 3.4% interest rate levied against the student loans, the rates automatically becomes 6.8%!
Thus, for example a new college student intending to take out a $23,000 student loan taken after July 1 will have to repay the government after leaving school $265 per month at 6.8% interest rate. The monthly payment is $39 more as compared when the loan was secured under the old rate of 3.4% (Phillips, 2013). An insignificant amount for the established employee but for the recently hired employee who is just starting his or her career this can be a burden.
Traditional Approach to Education
Getting a US college education is a tough balancing act especially for prospective students coming from the lower economic levels. The need to secure a good college education and training is a given if one has to secure a well-paying job later on. Yet, the cost of traditional college education is well beyond the reach of most students and their families to afford. Given the financial limitations of most students and their families in securing a college education, how then can they expect to land a job in the future?
The US government has already offered a solution to this dilemma through the subsidized federal Stafford loans. Named after Sen. Robert Stafford, a Republican from Vermont, this form of student loan is provided to eligible students enrolled in higher education institutions like colleges or universities.
While the students are still enrolled, whether in a full-time or part-time basis, the government does not expect payment for the loans secured. Instead, a grace period of six (6) months after leaving the school by means of graduation, withdrawal or dropping is extended to the students. After this deferment of payment period, the concerned student is now required to repay the loan usually on a 10-year repayment terms. This is because the student is already expected to have a job and a salary that can pay back his or her loans.
Options for Students from Low-Income Families: The Non-Traditional Way
Getting quality education and obtaining a decent job is what everyone wants. Despite the education loan increase, a good quality education and training is still possible given the many options available to students these days. A student should not just fix his sights at the traditional way of learning but also must expand his horizons by way of the non-traditional route.
One such non-traditional option is e-learning where the costs of obtaining quality and relevant education and training is definitely lower compared to getting education from traditional colleges or universities.
E-learning involves the use of computers, virtual classrooms and the concept of microteaching in imparting knowledge and skills to the students. Professional coaches or mentors are readily available to teach students the lessons they really need to know and the skills they need to learn so that these can immediately be applied at work and the students can immediately earn income from them.
Get to know more what e-learning can do for you. Visit MicroTeachings.com for more details. We can help you become the professional you want to be and get you the job and salary that you really want for you and for your family.
Reference:
Phillips, M. (2013), US student-loan interest rates just doubled because congress went on vacation: 10 things to know, Retrieved July 2, 2013 from: http://qz.com/99347/us-student-loan-interest-rates-just-doubled-because-congress-went-on-vacation-10-things-to-know/