Here’s why your student loan payments bother you

Every time I make a student loan payment, I feel sick to my stomach. I don’t feel that way when paying credit card bills. What gives? and Policy Priorities, forcing students and families to take on a larger share of the cost. So there are real reasons many have a special brand of loathing for our student loans.

Here’s how they differ from other debt.

We didn’t get something tangible in return

Student debt isn’t like a car loan, says Sandy Baum, a senior fellow at the Urban Institute. You don’t get a car that shuttles you to weekend hiking trips in exchange for your mammoth payment. But, Baum says, “just like you get in your car and drive it every day, you use your education every day.”

If the U.S. moved toward a policy of payroll withholding for student loans, as it does for taxes, Baum says, you probably wouldn’t miss the money as much.

“Not that anybody likes paying them,” she says, “but it’s a lot easier, because then you construct your budget without those dollars in it.”

We didn’t fully understand the risks

The financial aid system is so complex, students and families often struggle to untangle the snarl of funding options — let alone grasp their longterm financial consequences. For example, many borrowers don’t know about basic strategies that can ease their loan burden from the outset.

Katie Choma graduated with a bachelor’s degree and $161,000 in student debt. That debt burden translates to payments totaling about $1,500 a month. Choma’s balance is mostly in private student loans, which, unlike federal loans, generally don’t offer incomebased repayment plans.

She wishes she and her parents had known to prioritize federal loans when she took on debt — and when she was choosing a school that she couldn’t have afforded without private loans.

We may not have gotten what we paid for

Thanks to her full-time job at a marketing company and a side business as a wedding planner, Choma is able to afford her bills on a 60-hour workweek. It wasn’t easy on a recent grad’s salary at first, she says. But at 26, she’s already seeing the earnings boost her bachelor’s degree affords her.

For some, though, there’s no degree to count on. Low-income borrowers, in particular, are at risk of dropping out, often due to the strain of paying for college without adequate financial aid, says Sara Goldrick-Rab, a professor of higher education policy and sociology at Temple University.

Borrowers who take on debt and don’t graduate have fewer employment opportunities and more limited earning potential, leaving less room in their budgets to make their loan payments.

Goldrick-Rab says dropping the price of college would help students graduate, which would benefit the economy as a whole.

“I think we should price college as if it wasn’t so much a private good,” she says, “but it’s so much a public necessity.”