fan…because it eventually must.

On the horizon is America’s next big financial issue: student loan debt. Currently, student loan debt cannot be discharged in bankruptcy (except for rare instances where the Brunner prongs are overcome, a high bar). The problem is simple. The rising costs of education (including the rising costs from the last 20+ years) do not result in a commensurate rise in income. Sure, there are some outliers. Eventually a good surgeon will make a lot of money and pay off their medical debt. Certain lawyers do well. Ph.D.’s who get the right job will be okay. But many will not. Take a typical teacher, for instance. It is mandatory that a teacher get a B.S. or B.A. That’s four years of college (and let’s not even get into the issue of how those teachers who then further educate themselves cannot get jobs in education because now it costs too much to hire them. Just ridiculous.). Conservatively, let’s say that teacher now owes $50,000 (which is only $12,500 per year for four years). Is that teacher going to be able to pay off the student loans earning just $37,000 per year? Doubtful. Or, if she does, it’ll take a long, long time with the interest rates benefiting the creditor (because, other than death, there’s very little chance the debt is discharged through bankruptcy or eliminated any other way). So, Congress MUST act. And it will. It will because America has this habit of acting only once things really hit the fan. And guess what? The fan is fast approaching.

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