Measuring the Student Debt Crisis
April 10, 2020
By Jim Courtland, Nora Delaney, and Ali Fredman
Higher education plays a more crucial role than ever in Americans’ professional development and social mobility.
As the COVID-19 pandemic deepens hardships throughout the United States, it is more important than ever to examine the legacy of student debt in financial adversity.
The rising cost of attendance at most higher education institutions, along with astounding levels of federal student debt, have continued to raise the stakes for Americans pursuing a college degree. Even then, risks are not equally distributed, with non-traditional and minority students experiencing an outsized debt burden and truncated career development relative to peers at well-established four-year programs. The unpredictable returns to higher education investment call for a shift in the way we understand higher education financing and its associated risks.
For students, choosing to invest in higher education should never be a gamble.
Income-share agreements (ISAs) re-align the relationship between higher education finance providers, schools, and their students. Since student repayments are linked to their income and career success, ISAs provide a mechanism for investors and schools to demonstrate accountability to students’ outcomes, shifting labor-market risk away from students.
Read more about America’s Student Debt Crisis–and how ISAs can solve it–in our newest white paper: