One Virginian Mother and Her Ten Cents

As student loan defaults continue to become more and more common, an increasing number of graduates are seeking student loan help. What has led them to this course of action?

This is a tough economy for everyone, but a number of factors make it even more difficult for recent college graduates. By far the most significant is the underemployment of those graduates – a problem that is beginning to scare people away from universities altogether.

Underemployment exists when a person is only able to get a job that pays a small portion of their bills, or only work a job that is well below their level of qualification. For example, recent graduates with degrees in engineering, neuroscience, business and literature find themselves faced with jobs as bus boys, bartenders, waiters and taxi drivers – or the option of not working at all. Most graduates have the good sense (and work ethic) to take whatever job is available, but just because it pays doesn’t mean it pays much. And with average monthly payments of $650 or more on student loans, a lot of these jobs lead to very hard choices about which bills to pay and which ones not to.

Compounding this, an increasing number of un-graduated college students can see the lack of choices their graduate friends have, and are bailing on the system altogether. Instead of spending more money to get their degrees, they decide to drop out of college. Unfortunately the loans they’ve already accrued then become due, and these students also need help paying.