The Simple Answer to Earning a College Degree with Less Debt
Singing the tune of staggering student debt is nothing new. By now we are all accustomed to headlines that read something like, “Why student debt is ‘a crisis’ for some borrowers,” and “Average student-loan debt skyrockets to disturbing high.”
But despite the hysteria, this national problem does not have to take on the gorilla-like persona that so many students fear. In fact, with a little bit of time and counsel, it’s all quite simple and possible to avoid.
According to the latest data, Americans owe over $1.3 trillion in student loan debt, spread out among 42.3 million borrowers. This means that the average collegiate borrower has about $30,733 in student loan debt.
Make no mistake, education can be a tough investment, but it should not rival providing for a family or bury anyone so far into debt that there is seemingly no way out.
Recently, the U.S. Department of Education announced that Western Governors University’s (WGU Nevada’s parent institution) three-year default rate decreased again last year, to 4.8% — less than half the national average for all other U.S. universities of 11.3%.
WGU’s low default rate is the result of a three-pronged approach: affordable tuition that reduces the need for borrowing, up-front financial counseling that encourages responsible borrowing, and a focus on degree programs that help graduates advance their careers, which better positions them to repay their loans.
WGU Nevada’s tuition, which has not increased since 2008, is about $3,000 per six-month term for most programs, regardless of the number of courses completed.
In addition, the online, nonprofit university’s innovative competency-based learning model allows students to advance as soon as they demonstrate mastery of course materials, making it possible for students to accelerate their progress toward a degree, saving both time and money.
The average time to complete a bachelor's degree at WGU Nevada is about two and a half years, making the average cost of a bachelor's degree about $15,000 — again, less than half the national average of $37,990 for a four-year degree.
When coupled with the fact that WGU graduates on average increase their income by $19,100 within four years of graduation, this shows that the average return on investment for a WGU degree is about one and a half years!
Responsible Borrowing Initiatives
Responsible borrowing at WGU Nevada focuses on helping students understand student loans and encouraging them to borrow only what they need. All students who apply for financial aid receive a personalized Financial Aid Plan, which recommends that they borrow only their “unmet direct costs” — tuition and fees minus any grants or scholarships. The personalized plan includes information about the cost of attending WGU Nevada as well as links to financial aid tools and resources.
In the four years since this program was implemented, 65% of borrowers accepted the recommendation to borrow less, and another 10% declined loans altogether. By simply providing useful information, WGU has been able to significantly change student behavior and reduce borrowing by 41%, a savings of $400 million in student borrowing.
For those who are first-time college students, graduate students, or those looking to finish a degree that they started years ago, WGU Nevada’s focus on offering degree programs with direct market value means that graduates can be assured that they have the knowledge and skills necessary to succeed in their respective discipline — without breaking the bank.