The student loan “elephant in the room” grows larger in the U.S. as many borrowers are making efforts to repay their debts.

Source: http://www.npr.org/sections/ed/2016/07/26/486934590/good­news­on­student­loans­for­some

Amidst the student loan debt crisis, there have been programs implemented under the Obama administration that aim to help college graduates repay their student loans. This historical election year has brought up the conversation of making college affordable. During this election, Senator Bernie Sanders captured the attention of young voters by calling for “universal education”. This has created a ripple effect among presidential candidates, influencing them to pay attention to the issue of student loan debt. For the first time in decades, young people are a part of the political discussion of affordable college. In the coming years, there may be some drastic changes to improve the dire situation of college student loan debt.

College graduates and drop­outs are drowning in student loan debt. The national balance of student loan debt is currently $1.3 trillion ­ but it is only going to keep growing. Interest rates stack up the borrower’s balances even greater, which sinks the college graduate in debt even further. However, thanks to the Obama administration, income-­based repayment plans are readily available to borrowers with federal student loan debt.

Any borrower with federal student loan debt qualifies, even if their loans have been placed in default. There has been a 20% increase in borrowers signing up for these programs in just four years. These programs are easily accessible and tailored according to the individual borrower’s discretionary income. As such, the monthly payments are capped at 10% of the borrower’s income. Under these repayment plans, the average college graduate takes 10 to 25 years to pay off their loans. Income­-based repayment programs are only going to get more popular as more college graduates learn about them.

However, those who have dropped out of college seem to stray away from signing up for these income­-driven repayment plans. 64% of borrowers that are signed up for an income-­driven repayment plan hold a college degree. Many college-­dropouts are missing out on their opportunity to pay back their student loans without compromising their financial security.

Although this plan has been effective for borrowers paying off loans and building up their credit after being placed into default, there are still tremendous changes that need to be made in order to crush student loan debt. The future of student loans and financial aid is going to be heading in a different direction. As more and more college graduates learn about income-­based repayment plans, there will be a large jump in popularity among borrowers signing up. Employers have also taken into account the desires of young people entering the workforce. By implementing new benefit packages that include student loan repayment programs, more young people with student loans will be applying for jobs that offer these benefits.

Student loan debt is slowly being chipped away by applying these programs, but the issue resides in how accessible these programs are to any borrower. The unemployed are unable to opt for an income­-based repayment plan. There are not enough programs readily available for them to use, such as student loan debt forgiveness. In addition, another pressing issue that remains is that borrowers who have been placed into default are not signing up for repayment plans. Borrowers who cannot afford to pay are being placed into default without seeking options to refinance or break up their loans into smaller, monthly payments.

The national student loan debt is only going to continue to grow unless significant cuts are made. But until then, the “elephant in the room” is not going anywhere anytime soon.