As costs of public and private colleges continue to climb, NJ students are sinking deeper into debt, but learning to be smarter about money can be a huge help.
As the cost of tuition continues to rise, more and more students across the country are being forced to take out hefty loans to pay for their college educations. In New Jersey, the student-debt issue is a particular concern, with college students here carrying some of largest debt burdens in the country.
A bipartisan group of state lawmakers is now trying to help stop New Jersey’s students from being held back by heavy debt after they graduate college by ensuring they receive at least some instruction before they leave high school on the issue of college affordability.
Athat cleared the Senate Budget and Appropriations Committee yesterday would require New Jersey’s current high-school financial-literacy curriculum to be amended to include courses on issues like the student-loan process and tuition-assistance programs. The measure would also require guidance counselors to teach students about how they can save money in the long run by completing courses that will count as college credits before they graduate high school.
Trying to stem tide of student migration to out-of-state schools
Sponsors of the bill tied the issue yesterday to the broader state economy, arguing that students could be discouraged from buying homes and starting their own families in New Jersey if they’re struggling for years to pay off hefty loans. A leading state business-lobbying group has also come out in support of the legislation, saying the effort could help stem a student migration problem that has resulted in the loss of thousands of New Jersey high-school graduates to out-of-state schools each year.
According to areleased by the College Board, the average cost of tuition during the 2016-2017 school year was $9,650 at a four-year state college or university, and $33,480 at a private institution. The total rises to $20,090 when room, board and fees at state schools are added into the calculation, up about $520 over the prior school year. And the all-in figure is even higher for private colleges and universities, with tuition, room, board and fees costing an estimated $45,370 during the 2016-2017 school year, up by $1,500 over the prior year.
Aon student debt released by the Institute for College Access & Success also indicates students in New Jersey are especially burdened with college debt. Two-thirds of the class of 2015 left school with at least some level of student loans, ranking as the eighth-highest percentage in the nation, the report said. On average, the New Jersey students had $30,104 in loans from public and private four-year colleges, the country’s 11th highest amount.
Aby the New Jersey College Affordability Study Commission also raised concerns about rising college costs, calling for state tuition-assistance programs to be widened amid other sweeping recommendations.
High school students in New Jersey already receive some instruction on basic financial literacy issues like balancing a checkbook. Under the bill that cleared the Senate budget panel yesterday, the existing curriculum would be expanded to include several issues related to the cost of attending college and student loans.
Too many graduates 'saddled with excessive debt'
Students would receive instruction on existing state and federal student-loan and tuition-assistance programs, scholarships and grants. They would also learn about student-loan repayment issues and the consequences of not paying down student debt in a timely manner. The bill would also require students to meet with a guidance counselor during either their second or third year in high school to discuss financial-aid programs and dual-enrollment courses that may be offered to provide students with an opportunity to earn college credits essentially for free while still attending high school.
If ultimately approved by the full Legislature and signed into law by the governor, the financial-literacy curriculum changes would go into effect for the 2017-2018 school year.
Sen. Sandra Cunningham, one of the sponsors of the legislation, chairs the Senate Higher Education Committee. Cunningham (D-Hudson) said “too many graduates are being saddled with excessive debt, which is holding many of them back from purchasing a home, starting a family and contributing to the state’s economy.”
Sen. Robert Singer, another bill sponsor, also sits on the Senate higher-education panel. Singer (R-Ocean) said the current process of applying for a student loan is “far too complex.”
“Many graduates aren’t getting an education that matches what they paid just to get through the classroom door,” Singer said. “This doesn’t change the fact that it is extremely difficult to become financially independent without a college degree. As we work to achieve greater reform, we must do everything we can to ensure future graduates are prepared to handle this responsibility.”
Andrew Musick, the New Jersey Business and Industry Association’s vice president for taxation and economic development, also linked the bill to efforts to improve the quality of the state’s overall workforce. His organization has been raising concerns in recent years about anamong millennials, including students who decide to attend college in other states where a lower cost of living may entice them to stay away after graduation.
“Creating more affordable pathways for New Jersey students to earn a college degree is important for students and essential to the state’s long-term economic growth,” said Musick, whose organization has also supported recent efforts toat New Jersey’s colleges and universities through a $750 million bond act approved by voters in 2012.
“In order to deliver the highly skilled workforce that is critical to the economy of the future, we need to keep more of our brightest students here in New Jersey,” he said.