According to a new report, the amount Americans owe on student loans now exceeds credit card debt by 3 billion dollars. Experts say one reason for the increase is the rising cost of higher education. Also, more loans are available now than they were years ago.
Every year thousands of students head to college campuses seeking a degree. Many Coastal Carolina students like Nina Kallmeyer need help from loans to pay for tuition, housing and books. She hopes the mountain of debt she's accumulating will be worth it in the end.
"I really think about it everyday going to school making sure I have good grades, because what's the point in being here and wasting your time if you're going to have to pay it off." she said.
Experts say students shouldn't borrow more than they need for their education, they should look for scholarships and grants first, and they should live like a student while in school so they don't have to after they graduate.
"People carry it the longest. Other than a mortgage, student loan is the next thing that takes 10 to 15 sometimes 20 years to pay off. There's a lot of people that are 45 years old paying for the fun they had in college," says financial planner Jimm Thompkins.
"It's more cost effective for the government to loan money to the student than it is to give them grants. The shift has been gradual over the last 20 years but it's definitely there," adds Greg Thornburg who works in the Financial Aid office at CCU.
Counseling is required on government student loans, and CCU officials work with seniors to prepare them for loan repayment after graduation.
Thompkins says ideally parents can help break the student loan debt cycle by starting a college fund early. "You're taking an advance against your life, and it has to be paid back. It would really surprise me if one out of ten kids understood that."
Unlike credit card debt - where filing for bankruptcy can clean the slate - student loan debt must be repaid.
Oftentimes people don't realize how much they owe until they go to make a large purchase such as a house.
