A front page article in The Wall Street Journal (December 20, 2021) is a scathing expose of New York University's (NYU) practice of charging exorbitant tuition while students and parents borrowed far beyond their ability to repay. "NYU Tops Ranks-- in Debt for Grad Student, parents: pricey Manhattan school leaves many families struggling with loans" by Melissa Korn and Andrea Fuller provides gruesome details about the burdensome debt that both NYU undergrads and grad students and they parents are undertaking. The federal Grad Plus and Parent Plus loans burden families while enriching universities, even ones like NYU that have substantial endowments (but meager student aid). NYU's endowment ended fiscal 2021 at $5.8 billion.
One WSJ graphic shows: "New York university has more graduate programs that leave students with high debt loads compared with their salaries than any other U.S. university."
Majoring in film at NYU is a sure bet to land students (and some parents) in debt loads they will never be able to repay. Meaning the U.S. taxpayer ends up footing the bill.
U.S. Colleges and universities offer so many options and opportunities for quality post-secondary education at affordable rates. Plus part of what students and their families need to consider is: Is it worth going into debt for a degree or credential that is unlikely to pay enough for me to live on, let alone repay student loan debt.
What I can't wrap my head around is what the students and their parents were thinking when they signed up for huge education loans.
Student loans cannot be discharged in bankruptcy (another area of my research).
Johnson, C., O’Neill, B., Worthy, S. L., Lown, J. M., & Bowen, C. F. (2017). What are student loan borrowers thinking? Insights from focus groups on college selection and student loan decision-making. Journal of Financial Counseling and Planning,27, 184-198.
The answer: they weren't... thinking.
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