How to Tackle Student Loan Debt And Fuel The Indiana Economy

Posted: Updated:

With graduation season complete, thousands of newly minted college graduates are entering Indiana's work force. It's a time for celebration, but as the pomp and circumstance fades, many recent graduates and their families are asking a serious question: How will I begin to pay off my student loans?

Hoosiers are right to be asking this. In Indiana, the average student graduates college with more than $29,000 in loans, a figure that stands to increase. In fact, student loans are the only form of consumer debt that has grown since the height of the Great Recession, now totaling more than $1.3 trillion nationwide - more than what the entire nation owes in credit card debt.

And it’s not just recent graduates who grapple with student loan debt. Their parents and adults who are years out of college also are burdened by sizable loans, which in some cases carry high interest rates.

That matters not just for borrowers, but for our state as a whole. Every dollar put towards paying off student loans is diverted from other important personal investments, such as payments on homes, cars, small businesses and retirement accounts – all of which stabilize and strengthen Indiana’s economy.

Individual Hoosiers, along with employers and policymakers, must make it a priority to ensure graduates are equipped for success in managing and ultimately paying off their loans. Three key strategies can help advance this goal:

Refinancing student loans offers a way for Hoosier graduates to reduce their interest rate payments and channel money towards other meaningful investments. Refinancing is worth exploring for most borrowers, even if it’s is not the right step for everyone. Employers can support their workers in this by helping them navigate refinancing options – or helping pay back student loans –as a benefit to attract and keep top talent. And policymakers can ensure Hoosiers have access to affordable options for refinancing, such as the nonprofit option INvestEd provides.

Thoughtful planning for college costs enables Hoosier students to avoid incurring onerous student loan payments in the first place. Before students and families begin applying for financial aid or mapping out payment plans, it’s important they factor in key calculations, such as graduates’ earning potential, the cost of college and the level of debt that’s manageable for them.  Working with financial aid literacy professionals – through high schools or in some cases, employers offering coaching to their employees as a benefit— helps ease the planning process.

Exploring all options for tuition loan providers is critical. As with all purchases, student loan borrowers must be savvy consumers. There are myriad lending options, from federal loans to those offered by private lenders and nonprofit, Indiana- based providers like INvestEd. Consumers should compare rates and benefits offered by each to determine the package of loans that makes the most sense for them.

Addressing the student loan challenge might seem daunting, especially considering that more than 44 million Americans have outstanding student loan debt, a full 13 percent of the population. But proactive steps such as examining loan refinancing, planning for college costs and exploring loan options make the task of tackling student debt manageable. And doing so has never been more critical for our state’s economy.

By ensuring that paying off student loans is manageable, we will not only empower Hoosiers with more money to contribute to important investments; we also will make college completion more within reach for Hoosiers. That will lead to more residents with higher education in Indiana, which is critical, given that more than two-thirds of jobs will require education beyond high school by the end of this decade.

Indiana already leads among states when it comes to the generosity of our grants and scholarships for college students. We can build upon this success by becoming a leader when it comes to managing student loans. Doing so requires collective effort and key steps to ensure that every Hoosier graduate is equipped for success in paying down debt.

Joe Wood is the president and CEO of Indiana nonprofit INvestEd.

  • Perspectives

    • Eight Free Ways to Build a Diverse and Inclusive Startup

      It’s easy to avoid investing in diversity and inclusion, especially as a startup founder who’s pulled in dozens of directions. It’s easy to avoid conversations about diversity and inclusion. And it’s downright simple to punt responsibility to the budgets and resources of the tech giants, and hope that the results trickle down to startups. But excuses won’t cut it anymore. Being intentional about diversity and inclusion doesn’t have to cost a dime.

    More

Subscribe

Name:
Company Name:
Email:
Confirm Email:
HTML
INside Edge
Morning Briefing
BigWigs & New Gigs
Life Sciences Indiana
Indiana Connections
INPower
Subscribe
Unsubscribe

Events



  • Most Popular Stories

    • Milhaus Lands Major Investment

      Indianapolis-based real estate developer Milhaus has received a $245 million equity investment from FrontRange Capital Partners in Colorado. The developer says it will use the money, which also includes funding from a group of internal investors, to reach its goal of having 20,000 units in 10 markets by 2020. Milhaus adds an upcoming undisclosed investment from StepStone Group Real Estate LP will contribute to the effort. The company specializes in urban infill and suburban...

    • State Announces 2017 Stellar Communities

      Lieutenant Governor Suzanne Crouch has unveiled the 2017 Stellar Communities designees. The city of Madison and the town of Culver were chosen out of a group of six finalists and are now eligible to receive federal funding and access to state resources to assist with quality of place improvements. The winners were selected following visits from representatives of the Stellar Communities Designation Program State Team, which toured the locations of...

    • Harman Details Elkhart Layoffs

      Connecticut-based Harman International Industries Inc. (NYSE: HAR) has announced the first round of layoffs stemming from the closure of its Crown Audio plant in Elkhart. In a notice to the state, the company says 50 employees will be let go December 22. In September, the audio technology manufacturer announced plans to close several facilities worldwide and lay off 650 workers. The Elkhart plant employs approximately 115 people. Harman says the 50 employees being laid off...

    • Fort Wayne Metals Announces Major Expansion

      Fort Wayne Metals says it will invest more than $50 million into its Allen County operations and add more than 330 new jobs by 2021. The precision wire, strand and cable manufacturer says growing demand led to the expansion, which includes an addition to its corporate office and a new building. Fort Wayne Metals currently has more than 800 full-time employees at facilities in Fort Wayne and Columbia City. Chief Financial Officer Troy Linder says the ...

    • Soards: FirstNet Will Offer Multiple Benefits For Hoosiers

      Indiana is one of 25 states to approve FirstNet, a subscription-based communication network for public safety and first responders. The plan, offered nationwide by AT&T, will build high-speed, wireless communication infrastructure at no cost to taxpayers. “Indiana’s first responders need fast, accurate information to keep Hoosiers safe,” said Indiana Governor Eric Holcomb. “This new communications network will help those on the front lines coordinate...