Congratulations Graduates, and Good Luck with that Crippling Debt
Many students graduating from the University of Wisconsin this week leave campus with potentially crushing levels of student loans.
Nearly three-quarters of in-state students attending Wisconsin’s public universities take out loans, totaling an average of more than $27,000 of debt, according to the most recent figures. The average amount for University of Wisconsin students taking on debt has climbed 35 percent since 2002, even after being adjusted for inflation.
That increase in debt for new UW graduates is caused in part by tuition hikes and decreases in state support for the state’s university system. The state budget passed last year increases in-state tuition for undergraduates by 5.5 percent for two years in a row, and freezes financial aid.
But the tuition increases in the most recent budget are nothing new. Over the last 20 years, tuition at UW-Madison has risen at an average rate of 4.9 percent per year, not counting increases due to inflation. In fact, a student from a modest-income family can expect to pay more in tuition, fees, and room and board at UW-Madison than at Harvard, according to CNN’s college cost calculator. That’s because Harvard offers much more extensive financial aid than the University of Wisconsin system does.
UW students graduating in the future may owe even more in student loans. That’s because the interest rates on federally subsidized student loans are set to double at the end of the year, unless Congress acts. The higher interest rate would apply to new loans taken out after July 1 of this year.
To make the University of Wisconsin more accessible, we should work to invest in our public university system and rein in tuition increases. Saddling students with high levels of student loans hurts the newest entrants to our workforce, and adds to economic uncertainty.