Should you Worry if You Have a Student Loan?
The current recession that we are experiencing is one of the worst in our recorded history. If it wasn’t for the federal government pumping in bucket loads of cold hard cash to prop things up, we would have crashed our economy with unthinkable consequences. With so many media organizations lambasting us with this information it isn’t unexpected that people start to worry. Amongst the group of people who don’t know what to think about their future are students who are funding their education with either government or private student loans. In short, if you are currently a student then the recession really doesn’t pose any danger to you.
The logic of good government dictates that student loans should be the last thing that they should cut back on is access to funds for education. In the matter of protecting your own government it makes sense to allow people a good education. Cutting back on education funding in the form of students loans, private or otherwise would be similarly expressed as taking your children out of school just to pay for your credit card bills. It isn’t a smart move by any measure. The results of cutting education loans would be a population that is generally lower educated, less competitive and will result in severe problems for the country in the future.
If you look at other industries, students actually have it much easier compared to the rest. Companies or participants in the construction and finance industries have it the worst this recession. So much so that if you are in these industries it is almost guaranteed that you won’t get any funds from banks or anywhere. Sources of funds for these industries have all but dried up. This is why you see so many construction projects that are put on hold and also many small finance aggregators shutting down
Although those with existing student loans private or otherwise have very little to worry about those that are starting their college years and looking for student loans may find things trickier. The first thing most would notice is that private student loan rates have increased slightly compared to pre-recession periods. For those who are servicing their loans it might be harder for them too because jobs are harder to come-by and some may even have the bad fortune of being laid-off. If however you are in school, there is nothing to worry about.
A study by a renowned research revealed that amongst those that were affected by the recession, the students group actually was one of the least affected. The group that fared the worst was the retired, seniors and elderly folk. This group saw the most significant financial set-back due to the recession. They lost the most money because they had the most invested in the real estate and financial industry.
In the long-run students might even stand to benefit from the knock-on affects of the recession. The first thing that students might notice is that the rental for their homes might have gone down. This is because of the underlying price of the homes have deteriorated over the recession and some landlords base their rental price on the price of their houses and that the general rental price for properties have also deteriorated city wide. Most of us will also see that the prices of general goods and services might also decrease slightly. Again for students, this is a good thing as their student loan will provide a stable source of funds.
Overall, we are in the view that students shouldn’t be too worried about themselves in view of this recession. They aren’t exposed too much of the downside of the recession however are well placed to benefit from the upsides that the recession brings. Sit back and relax while you get an education, worry about the recession when you are out looking for a job.
Please visit us at Able Private Student Loans for the latest news about the student loan industry and also how you can get cheap education funds.