Graduations are an exciting time for
most families. They will throng to auditoriums, gymnasiums, churches,
or outdoor settings bearing flowers, balloons, and other goodies.
They’ll likely go to lunch or dinner and share smiles and
memories, congratulating the graduate on her achievement. Then what?
About
four million people will receive degrees, from associate to
doctorate. Too many of them, though, will walk from the graduation
stage into a debt trap. Those who have student loans must start
paying them six months after graduation or if their enrollment status
falls below half-time. Though student loan repayment was suspended
(not forgiven) during COVID, payments must resume by September 1.
Borrowers must repay whether they are employed or not. Although loan
servicers will sometimes adjust loan terms with modified repayment
plans.
Twenty-seven
million Americans have student loan debt, totaling more than $1.7
billion. One in four Black women carries such obligation, the highest
proportion of any population subgroup. Black women owe more than
others. And college-educated Black women earn less than other
college-educated people, with Black women with a bachelor’s
degree earning just $60,000 a year, compared to $75,000 for Black
men, $67,000 for white women, and $91,000 for white men. The
Education Trust, a Washington, DC-based think tank, produced a
report, How Black Women Experience Student Debt, attributing the
heavy debt burden Black women carry to unequal pay, the wealth gap,
and flawed public policy. When we look at the debt through the lens
of recent college graduates, it is essential to note that Black
women’s unemployment rates may make loan repayment difficult.
If
repayment is difficult, failure to pay will adversely affect a credit
score, limiting the ability to rent an apartment or purchase a home.
In some cases, a low credit score may even limit employment
possibilities. If you can’t work, you can’t repay your
student loans, but if you can’t repay your student loans, you
can’t work. While this situation is challenging for everyone,
it is much worse for Black women.
Twelve
years after leaving college, Black women owe 13 percent more on their
loans than when they graduated, while white men have paid back 44
percent of their loans. Black women end up owing more because
interest piles up when they haven’t made their loan payments on
time, and the unpaid interest adds to the already high debt. And
because education is so highly valued among many Black women, a
disproportionate number of black women who earn doctorates earn them
from costly for-profit colleges that offer little financial aid, and
often have few student support services. Some Black women graduate
with six-figure debt to earn a doctorate that may only result in
low-paid adjunct faculty employment when they compete against others
with more traditional credentials.
President
Biden promised to alleviate student debt, but he hasn’t done it
yet. Postponing the repayment date only delays the inevitable.
Repayments resume just two months before the midterm elections. Has
the President considered the fact that his failure to act may impact
the composition of Congress in 2022? On the other hand, loan
forgiveness might encourage some younger people to get out and vote
because they’ve seen a return on their 2020 vote.
The
wealth gap has always been with us, and public policy sometimes makes
the gap even wider than it needs to be. Why can’t students have
the same low-interest loans as banks? Why can’t students have
the same loan forgiveness as some businesses during COVID? Why do we
encourage students to pursue higher education, then penalize them
with high costs of attendance and expensive loans. Community colleges
and state universities are low-cost, not no cost. Yet the students
who are enrolled in college are not only investing in themselves but
in the future of our country.
If
we value an educated workforce, we must rethink how we both fund
higher education and pay for it. By necessity, COVID has provided us
with different options. When students and parents push back on high
costs and the crushing burden of student loans, higher education
leaders will be forced to offer other alternatives. Meanwhile, Black
women, passionate believers in the power of higher education, pay a
very high price to pursue their passion. Something to consider as we
celebrate graduations.
