When students go to graduate school, it’s not because they want to be rich.
They’re doing it to pay for the tuition, living expenses, and books.
As with any kind of debt, this is unsustainable, as a recent report from Credit Suisse shows.
The cost of attending university in the US is expected to reach $1.4 trillion in 2022, up from $900 billion in 2019, the report found.
But when we think about the future, we often forget that students will pay more for college than they would pay today.
As a result, many students have little choice but to continue with school and go to school at the maximum cost.
This can leave them with a debt load that could reach $2.8 trillion by the end of the decade, according to a recent Credit Suse report.
It’s an unsustainable situation, but it’s also a problem that can be mitigated by changing policy.
While the number of students attending college is increasing, so too is the number paying for college.
The US has the world’s largest debt burden, with an average of $30,000 for a four-year degree, according the Federal Reserve Bank of St. Louis.
The average cost of tuition and living expenses at public and private institutions is currently over $15,000, according TOEFL.
The report notes that this debt burden will only grow.
“While the number and size of borrowers are increasing, they’re still going to need to pay more than ever,” said Greg Siegel, a senior vice president at Credit Suanse, in an interview with Quartz.
For the most part, these students can avoid this debt by borrowing directly from their parents or a college savings account, but this approach is risky.
According to the report, the average borrower has $8,000 in student loan debt, and only $3,600 in student loans forgiven.
This means that in addition to the $1,900 a year it costs for the first four years of schooling, the student will have to pay another $5,000 or so each year to pay off their loans.
In other words, even if the student manages to get out of debt before graduation, they won’t be able to get back in by paying off their debt and refinancing it.
For example, if the borrower takes out a $200,000 loan to pay down the debt, the total debt on their balance sheet is $4,000.
With a $300,000 down payment, the borrower could end up owing $4.7 million in student debt over four years.
“Students need to be cautious about refinancing their student loans, as this can be very risky,” Siegel said.
Students can still avoid this type of debt burden by paying down their debt over time and avoiding excessive payments, but Siegel cautions that they can’t get out in a day.
“They have to do what they can to mitigate the risk of default, which means they can take out large loans or refinance,” he said.
Even if students manage to pay back their loans over time, there’s still the possibility that they could be unable to pay them off because of the increased interest rate they’re paying.
As of March 2018, the median loan payment for students in the United States was $1 (about $200) per month, according ToEFL data.
This includes interest, fees, and principal, which adds up to more than $4 billion a year.
The most expensive category is a variable rate loan, which typically has a rate of 2.25% per month.
With this kind of monthly payment, students will owe $2,300 a year by the time they graduate, according Credit Suesse.
With the average student paying off $1 million of their student loan in debt each year, that means they’re left with a total debt of $2 billion by the age of 30.
The study also notes that while some students do pay off all or part of their loans, it may be harder for some.
According, to Credit Suses calculations, the percentage of students who take out a variable-rate loan is currently 8% or lower.
This could change if the rate rises in the future.
“The problem is that a lot of these students will not be able or willing to refinance their student debt because the interest rate will increase substantially over time,” Sige told Quartz.
This is especially true for students who took out a subprime loan and were unable to refinances.
“In these cases, a lot more of their monthly payments will be in interest and fees, which will lead to higher interest payments over time.”
If students don’t pay off a substantial amount of their debt in time, they could end with a large debt burden.
In some cases, borrowers could be forced to default on their student debts because they were not able to repay their loan within a certain time frame.
In such cases, the government could seize