Some time ago, the Observer released a video in which an American student cried out that law school tuition in China costs 798 U.S. dollars a year, or about 5,850 yuan, while she had to carry a debt of 450,000 U.S. dollars, or about 3.3 million yuan, for attending law school in the United States.
It’s a slave contract, she said excitedly! Without the Student Loan Forgiveness Program, I’d never be able to pay off this debt in my lifetime.
She believes that the American education system is a financial harvesting of students, with banks profiting from high interest rates on loans and students struggling to make ends meet.
Another blogger also mentioned that he spent $90,000, or about $650,000, to complete his college degree, and that the student loans were issued through high-interest companies with very high interest rates.
Another American netizen said that he was 22 years old and needed to repay $7,998,26 per month for his college loans, and that his debt was increasing every month and he felt that he could not pay it off.
However, in this reconciliation, the most injured are actually not American students, but those Chinese students studying in the United States and their parents.
Studying until you go broke
The cost of higher education in the United States is one of the highest in the world.
According to the National Center for Education Statistics, tuition and mandatory fees for four-year colleges in the U.S. have more than tripled in the last 60 years.
From an average of $5,369 per year in 1963, it has reached $17,709 in 2023, adjusted for inflation.
According to data published by U.S. News, over the past 20 years, private college tuition has risen by 134 percent, out-of-state tuition at public colleges has risen by 141 percent, and in-state tuition at public colleges has risen by a staggering 175 percent.
Top institutions like Harvard, Yale, Stanford, New York University, and the University of Southern California are projecting a total cost of attendance of more than $90,000 for the 2024 and 2025 school years, as tuition has risen again.
The cost of attending graduate school in the U.S. is comparable to buying luxury goods.
According to the Education data website, the cost of a U.S. master’s degree usually ranges from $56,000 to $75,000, or an average of about $59,684, or about 423,000 yuan.
The tuition fee of American universities is mainly divided into two parts: Tuition and Fees. Tuition is the basic tuition fee, while Fees include books, international student registration fee, medical insurance fee, campus facilities maintenance fee, etc. The tuition fee is the basic tuition fee.
In addition to tuition, books are also very expensive, even if you can afford to pay tuition, you may not be able to afford to buy textbooks.
According to a report by the College Board, between 2022 and 2023, students will spend an average of US$1,172.5, or RMB 8,838 per year, on textbooks.
For international students, these college textbooks are simply too expensive.
For example, microeconomics, which is a compulsory subject for business students, costs $160,300, or 1,160 yuan and 2,175 yuan.
This has given rise to a unique used textbook market in the United States.
Secondly, in addition to tuition and textbooks, accommodation and living expenses are also an important expense. Accommodation costs include rent, utilities, gas, internet and so on.
Graduate students usually choose to rent out rooms, while undergraduates mostly live in on-campus dormitories. The specific cost of renting an apartment varies from city to city.
For cities such as San Francisco, New York, Philadelphia, Los Angeles, Boston, etc., the average annual cost of living is between 20,000 and 25,000 dollars, which translates to about 140,000 to 180,000 RMB.
This cost basically covers accommodation, food, transportation and other daily expenses.
Taken together, the most conservative estimate for a graduate student in the U.S. is 500,000 RMB per year, while an undergraduate student will spend at least 600,000 to 700,000 RMB per year, and the total cost for four years may reach 2.4 million to 2.8 million RMB.
Because of this, many U.S. students have to rely on part-time jobs to pay for their tuition, and this can be a heavy burden for them.
One Loan Passes on for Three Generations
Now, 70 of American college students are burdened with student loans, the average person owes $37,000, and the lowest interest rate on the loan is 55, the highest can reach 8, and it is compounded with interest.
In other words, you owe more and more money, and the pressure to repay the debt after graduation is very great.
According to a report by the Peter G Peterson Foundation, the total amount of student loans in the United States will have reached $1.6 trillion by 2023, more than double the 2008 figure of $600 billion.
Surprisingly, this increase in debt far exceeds the Department of Education’s projections of changes in student enrollment over the same period.
According to the Department of Education, undergraduate enrollment has declined by 3 percent, while graduate enrollment has increased by 12 percent.
This suggests that the increase in student loan debt has not been proportional to the growth in student enrollment.
On average, students attending private for-profit colleges owe about $14,000 in federal student loans, about 50 percent more than borrowers attending public or private nonprofit schools.
Student loan debt has been growing faster than other household debt. between 2004 and 2023, student loan debt grew by more than 500 .
Today, student loan debt is the third largest source of household debt in the United States, behind mortgage debt and auto loan debt.
A growing percentage of adults are carrying student loan debt, and one of the main reasons for the surge in student loan debt is that more and more Americans are borrowing money to go to college.
According to the data, the percentage of households carrying student debt has doubled, from 10 in 1992 to 21 in 2022. This trend is especially pronounced among younger families.
The average student loan for families 25 or older in 2021 and 2022 is already approaching $50,000.22
The proportion of households in the 25-39 age group with student loan debt has climbed from 15 in 1992 to 41 in 2022.
Even former President Barack Obama experienced 21 years of paying off his loans until the age of 43, four years into his presidency, so you can see how heavy the burden is.
The problem does not stop there. There are a large number of older Americans over the age of 60 in the United States who are still paying back their student loans.
In 2005, about 700,000 Americans over the age of 60 had yet to pay off their student loans, and by 2015, that number had soared to 2.8 million.
By August 2022, the number of people over the age of 60 who are still paying off their student loans has reached about 7.2 million.
For those who don’t finish their education, it will be even more difficult because they are less likely to get a well-paying job.
A New York research organization called the New School for Social Research released a study showing that half of the borrowers over 55 who are still working earn less than $54,600, while their average debt is about $58,000.
The New York Times has also reported that the phenomenon of being exempt from loan repayment if you die ironically reveals the seriousness of the problem of student loan debt in the United States.
American student loans are passed on for almost three generations, and the debt seems to go on forever.
The Crisis of Repayment
In fact, the tuition and living expenses for Chinese students studying in the U.S. are much higher than those for U.S.-based students.
Public universities and state universities in the United States have different tuition rates for students of different status. Local students, i.e., residents of the state, usually enjoy much lower tuition rates than international students.
For example, a UCB resident international freshman is estimated to spend about $82,838 a year, of which $48,638 is estimated tuition and fees, and an additional $34,200 is required for non-resident supplemental tuition for out-of-state students.
While some students do offer scholarships for international students, opportunities are few and far between.
For most international students, these scholarships are very limited and are not enough to cover the high cost of tuition and living expenses.
Self-funded study at the undergraduate level is the mainstream choice for the vast majority of Chinese parents.
In recent years, many Chinese families are willing to spend a lot of money to send their children to study abroad in order to get a better education.
However, the high tuition fees and living expenses that come along with it have also put pressure on many families.
Some families have resorted to borrowing or cutting back on other spending in order to allow their children to complete their studies successfully, and this pressure is particularly evident among middle-class families.
The economic instability of the last few years has been a direct blow to them, and some families have begun to feel unable to continue to bear the costs of studying abroad, and have even had to face the dilemma of having to cut back on their tuition payments.
Some families have to make difficult choices between tuition and living expenses and other expenses, and even consider transferring their children to schools with lower tuition fees.
The cut-off of tuition fee means that the original paved road of prosperity is instantly reduced to nothing, and the original efforts and accumulations are completely overturned.
As the global economy continues to change, so does the financial burden of studying abroad.
Especially under the influence of multiple factors such as exchange rate fluctuations and rising living costs, the cost of studying abroad for international students is becoming more and more difficult to predict and control.
Parents often fail to anticipate these variables when planning for their children to study abroad, resulting in the actual cost of living abroad far exceeding expectations.
This overspending not only affects the quality of the student’s study and life, but also the financial stability of the family, and may even trigger a series of chain reactions.
In front of the high cost of studying in the U.S., how to balance the investment in education and the family’s financial situation has become an important issue that every family must face.
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