Mon August 19, 2013
Utah Ranks High for Low Student Debt
While the cost of obtaining a college degree in the United States continues to rise, Utah colleges and universities manage to keep college debt in check. NerdScholar, a website that helps college students make better decisions about higher education is calling Utah the 2nd best state in the nation for low student debt.
Pam Silberman is a spokeswoman for the Utah System of Higher Education. She says the state’s low debt loads and default rates are a culmination of several factors; one being that Utah taxpayers bear about 50 percent of the cost of higher education and a large number of students in Utah qualify for Pell Grants which don’t have to be repaid.
Silberman adds many Utah students are working while they attend college and paying out of pocket as they go. Those students obviously take out fewer loans. But Silberman warns they might end up paying more for college than their debt-saddled peers.
“The research shows that it’s actually not as cost effective, because it takes you longer to get your degree and ultimately that costs more money the more time you spend in school," Silberman says. "And the first credit is the most expensive credit. So the more credits you take the less they cost per credit.”
Silberman wants students to know having college debt isn’t a bad thing, as long as they borrow wisely.
“You know, people don’t hesitate to take out a loan for a car and yet cars decrease in value the minute you drive it off the lot," Silberman says. "Your education is the thing that makes you able to earn more money. Obviously you don’t want to have unmanageable student loan debt and you certainly want to look at your earnings potential in relation to the field you want to go into.”
In recent years Utah’s higher education funding ratio has dwindled from about 67 percent state funding and 33 percent tuition, to more of a 50/50 split. That means students are bearing more and more of the cost to go to college.
NerdScholar ranked Hawaii as the number one state for low student debt.