Around 40 million people in the United States have outstanding student loans, amounting to $1.2 trillion in debt. As they graduate, and struggle to find jobs, that massive debt limits their ability to make big purchases, like buying a home. Many people have asked the federal government to forgive their loans, and there is a push to make college education free.
A new report raises questions about how students are using that money. According to a study by LendEDU, nearly 1/3 of college students will spend some of their loan money to go on spring break.
With just over 20 million college students in the US, that means over 6 million students will be using money loaned to them, likely from the federal government, to travel, party, get drunk and make bad decisions.
The study also said that nearly a quarter of students use loan money to pay for alcohol, over 6% said they used that money to buy illegal drugs and just over 5% used the money to gamble.
The federal government holds a vast majority of student debt, so that means young college students are using your tax money, meant to help them get a quality education, to have a good time.
Not only are they abusing the system for their enjoyment, they are also hurting their parent's retirement plans.
In another study, 51.20% of parents that cosigned on their child’s student loan said their retirement has been put in jeopardy due to late payments made by their child. Many students are hamstringing their parent’s ability to retire because they are using their student loan money to pay for an island adventure.
LendEDU also found that nearly 50% of students believe that federal government will forgive their debt. Remember that next time somebody complains about the burden of their student loans.
Photo: Getty Images