Students of all races and ethnicities are taking out loans, but a larger percentage of Black undergraduates took out students loans than any other demographic group in 2011-12, according to a Wells Fargo report.
Johnny C. Taylor, president of the Thurgood Marshall College Fund (TMCF), said that he attributes the large number of Black students taking out loans to their parents’ financial stability or lack thereof. Reasoning that adults between the ages of 35 to 44 would be the most likely to have college-age children, he cited the national unemployment statistics for that demographic. Overall, 4 percent are unemployed, but 7.1 percent of African-Americans between the ages of 35 to 44 are unemployed.
With higher unemployment rates, parents would be unlikely to be in a position to help their children pay for college, leading the children to take out loans. “What that means then is that the only way current enrolled African-American students are going to get to school is relying on student loans,” Taylor said in a press call.
The days when students could work through a four-year college and pay their own way are long gone. The typical minimum wage job a college student might expect to get would more realistically cover the cost of books and some living expenses, not tuition and fees. And while the average American family might diligently put aside money for their children’s education, with a median income of $52,000, the majority cannot be expected to foot the full bill, even for one child.
As a result, students of all races are increasingly dependent on student loans. At some private four-year colleges, after all, the full price of one year of college is approximately $50,000 to $60,000. That number is not expected to go down any time soon.
“If something doesn’t change on the cost structure, $50,000 [may become] $100,000,” said John Rasmussen, Wells Fargo’s head of Education Financial Services. “That, I believe, is going to be much more painful and impactful than the realities of today.”
