The High Cost of College

The High Cost of College
25 Sep 2014

It’s hard to succeed in today’s world without an education; no one will argue that. However, the cost of college is ever increasing and unfortunately, more students are graduating with a tremendous amount of debt and the inability to pay it off. The statistics don’t lie:

– According to the Federal Reserve Bank of New York, in 2012, more than 30% of student loan borrowers who moved into       their repayment cycles were delinquent (more  than 90 days late on payments).

– In 2012, a total of 39 million people owed a total of $966 Billion (yes with a “B”) in student loan debt.

– In 2012, the average balance was $25,000. By contrast, in 2004 it was $15,000.

A weaker job market could play a significant factor in all of this. For example, the average unemployment rate for 20 – 24 year olds in 2012 was 13.3%, versus 9.4% in 2004. Additionally, student loan payments can make up a large portion of a young person’s budget. All of this has made student loan delinquencies rise as compared to other types of debt (as seen in the chart below).

studentDebt2

So, if you have young children and are considering setting aside money for college, we believe the sooner you start, the better. What good is a great education if it bankrupts you to get it.

Good Luck!

Jeffrey A. Johnston, ChFC
President of Premier Investments of Iowa, Inc.

Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Premier Investments of Iowa, Inc. are not affiliated .

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Jeffrey Johnston

Jeffrey is originally from Solon, Iowa. He currently resides in Swisher, Iowa with his wife, Prudence, and his three children, Seth, Ian, and Roman. He graduated from the University of Northern Iowa in 1989, where he majored in Finance and Investments. He has 24 years of experience in the investment and estate planning business. He is currently the President of “Premier Investments of Iowa, Inc.” Jeffrey’s main focus is Estate and Investment Planning for Senior Citizens and Pre Retirees. Jeffrey became a Chartered Financial Consultant (ChFC) in 2001. He is the author of many articles on industry related topics and he is a frequent seminar presenter. He is a Board Member TRIAD Linn County Seniors Against Crime, and he is also a past Board Member of the Heritage Area Agency on Aging Task Force. He is a member of CEO Roundtable in Cedar Rapids, a Daybreak Rotary Member, and a member of the Cedar Rapids Estate Planning Council. In March of 2009, Jeffrey became the host of the Premier Investments of Iowa Financial Hour which airs every Tuesday Evening from 6PM -7PM, on WMT 600 AM Radio. In his free time he enjoys golf, fishing, scuba diving, traveling, and coaching son’s basketball teams.