MANKATO — Most of the Minnesota State University seniors who visited with two state lawmakers Wednesday said they planned to move back home when they graduate.
The decision to return to their childhood homes is financially motivated, they said. Avoiding rent for awhile will help them start to pay off their student loans.
State Reps. Paul Thissen and Clark Johnson met with MSU students, professors and staff to talk about college affordability. Their visit was part of the Minnesota Student Debt Tour sponsored by the North Star Policy Institute. The tour also included a stop by Rep. Erin Murphy at Gustavus Adolphus College on Tuesday. The sponsoring institute bills itself as a think tank promoting “smart investments in working families' priorities.”
At MSU, students talked of the costs of attending college and how it has impacted their college experience and post-graduation plans.
The soon-to-be graduates reported they took out loans to help pay their tuition and living expenses and are now worried about finding jobs with sufficient incomes to afford their loan payments. A professor said she's witnessed many graduates take jobs they didn't desire because of debt desperation.
Students said the interest rate on their loans is as high as 6.8 percent, including government-backed loans.
Rep. Johnson of North Mankato said after the discussion he thinks it's wrong for the federal government to make a profit off student loans. He described such loans as “an investment in the future of the United States.”
The state representatives and North Star Policy Institute representatives advised there are opportunities for loan refinancing and for loan forgiveness for graduates in needed fields who work in a rural area.
The new state SELF Refi pilot program that offers lower-interest loans was noted. But the requirements for a high credit score and low debt-to-income ratio leave this option out of reach for many new graduates.
Tuition wasn't the only financial strain during their college careers, the students reported. Textbooks and travel for class and internships also add up, they said. One student reported she took on a second job to pay for gas. Another student bemoaned classes that require the purchase of a textbook that's used only a handful of times.
The left-leaning North Star Policy Institute is lobbying for a number of reforms to help college students and graduates, including making two years of community college attendance free of charge, freezing tuition rates at public colleges and universities, expanding the SELF Refi program and providing tax credits to people paying student loans.
An institute handout noted 70 percent of Minnesotans have student loan debt — the third highest percentage in the nation. The average debt for Minnesota graduates with four-year degrees is over $31,000, which is the fifth highest in the country.
Thissen, who is the DFL minority leader, said student debt has “big ripple effects” on the state and national economy. He encouraged students to contact their lawmakers and attend the upcoming caucuses to advocate for college affordability legislative measures.
Mankato Free Press
Posted on Thu, February 25, 2016
by Paul Thissen