Student loan debt has skyrocketed over the last few decades, and it’s causing all sorts of problems for borrowers. This starts with the fact that a lot of people are strapped with an incredible amount of debt as soon as they graduate, so not finding a good job immediately means that they’re in financial trouble in a way they never predicted when they were offered the loans at 17 or 18 years of age.
But this is more than just a problem for the students themselves. It’s also a major problem for the economy.
Too much debt acts like a recession
Essentially, when there’s too much student loan debt, it impacts the economy in much the same way that a general recession would. People have less buying power and they make fewer purchases. This means that businesses can’t grow. The economy becomes stagnant. In order for it to work, money has to be moving, but student loans prevent that.
For instance, imagine that somebody graduated without any debt. They would likely get a job, buy a car, rent an apartment or look into buying a home, and perhaps start their own business. But if they graduated with $100,000 of debt, they can’t afford a car or a house, and they can’t take a risk and start a business because they need a job to pay off that student debt right away. This hurts the economy for everyone, and there is no real end in sight.
If you’re dealing with excessive levels of debt, no matter where they came from, it’s very important that you understand all of your legal options. You may have more debt relief options than you know.