The data reveals that students are generally clueless about the costs of higher education and how they’re paying for it. Nearly half of students underestimated their debt loads by at least $1,000, with 25% of students underestimating their debt by $5,000 or more.
Why this cluelessness? They offer a few hypotheses:
There are a lot of reasons students may not fully understand their student loan debt: Students may be confused about the different kinds of loans (like federal or private), their parents may have taken charge of figuring out their education expenses, they’re simply not keeping track of their finances, or they really don’t understand the fact that borrowed money must be repaid. There’s not really a good excuse, considering the students had to sign paperwork saying they’ll repay the loan as agreed.
With that as a backdrop, how about asking your students to develop a 30-60 second Public Service Announcement (PSA) to convince students to understand their student debt? Send me the best PSA from your class and I will post them on the blog.
Check out the Next Gen Personal Finance lesson on Creating a PSA to help your students understand how to use this form of media as a way to persuade people.