The Student Debt Tipping Point

If a teenager plans to major in theater or social work should he or she assume more student debt than a kid who plans to become an engineer or an accountant?

Most families aren’t concerned about the earnings potential of their children when exploring colleges. According to a recent commentary in The Christian Science Monitor, 70% of students and parents don’t consider college majors a factor when determining how much to borrow.

Most families borrow for college and the value of a college degree is absolutely worth some financial sacrifice. I fear that the excitement of attending college, however, often overshadows the reality that these loans are accruing interest and must begin to be repaid shortly after graduation and in plenty of cases even sooner.

Ignoring the earnings capacity of teenagers could end up condemning the graduate into becoming indentured servants to a student lender for decades. According to the Project on Student Debt, the typical recent graduate carried $21,100 in debt.

So how much debt is too much? Mark Kantrowitz, who is the creator of, has always suggested this rule of thumb: Don’t borrow more than what you can expect for your first year’s salary after graduation.

FinAid has some worthwhile calculators on its web site that can illustrate just how much a family should take on. One calculator, for instance, determines the monthly payment for a loan and what the minimum salary should be to afford this debt.

Lynn O’Shaughnessy is the author of The College Solution and she also writes a college blog for

Further Reading:

The Most Lucrative College Majors

Want a Fat Paycheck? Attend These State Schools

The Double Major Bind

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