If only they had their health …
President Obama has emphasized the importance of higher education, and recently implemented ambitious higher education finance reform that will serve to benefit college students now and in the future. Although these changes are noteworthy, little has been done to help the many individuals who currently owe student debt, particularly private debt, and are no longer in school. With high unemployment and a stagnant economy, many student debtors are finding it increasingly difficult to repay their student loans and also cover the basic cost of living. An array of situations make it difficult for student loan debtors, whom I call the “indentured educated class,” to effectively pay their loans. This article will explore the relationship between student loan debt and its effect on those with health problems, using testimonials of those who have experienced this crisis and my own experience as the founder and executive director of the nonprofit All Education Matters Inc., where I receive hundreds and hundreds of stories a week from individuals who owe student loan debt.
Mrs. V received an MBA in 2007, and her husband recently graduated with a doctorate in Chemistry. Mrs. V has been struggling with health problems since the birth of her daughter, suffering from complications after having a cesarean section. In addition, the couple’s health insurance barely covers the basic cost of medical treatment, and their premiums are high. Because of this, Mrs. V and her husband realized they had no choice but to borrow more money once they had their daughter.
“I had to have surgery to fix a complication with my c-section. Again it cost us thousands of dollars out of pocket, even after paying incredibly high insurance premiums,” said Mrs.V. In many ways, Mrs. V and her husband are fortunate—they are able to make their loan payments. Mrs. V’s medical problems were short-term, but the couple continues to struggle financially as a result. Other debtors, with persistent and lifelong health problems, find themselves falling deeper into debt. Many of them fear there is no way out.
The testimonials from another indentured graduate, Mrs. P, and her two daughters, Amy and Jessica, illustrate the perilous situation that so many debtors with chronic health problems face. The two sisters attended DePaul University in Chicago, and both are recent graduates. Learning of my work as an advocate for student-loan debtors, their mother was the first person in the family to reach out to me. She has her own student loan debt, and she cosigned on her daughters’ loans.
Jessica has always struggled with serious health problems. When she was 16 years old, she had a heart transplant. A year and a half ago, she had her second organ transplant, this time it was a kidney, donated by her sister Amy. Despite these major surgeries, Jessica always wanted to go to college, as did her sister—they thought degrees from a good university would ensure that they would make decent livings. Even though they had received a few scholarships, they found that they needed to take out loans to cover the total cost of tuition. Fortunately, they were able to avoid taking out private loans, in which lenders can garnish wages without a court order and use other harsh ways to deal with debtors. But now out of school, Amy and Jessica are finding it increasingly difficult to pay their student loan debt.
At this juncture, Jessica said, “the total debt, it is safe to say, between the three of us is around $90,000, and that does not include the cost of late fees and accruing interest for the time my mom’s loan was put into forbearance.” One would assume that the two women, who have business degrees from a well-established university, are at least making decent wages. Like so many student debtors, however, that is not the case. Jessica earns $12 an hour, and Amy makes $8 an hour, plus tips.
Sadly, Jessica also continues to have health problems. “I just recently got over a cold. For most people this is not too much of a concern. But for me, I almost had to go to the ER. I still had to miss a day of work, which adds up. I am out of sick days, and any days that I have to take off will be taken out of my paycheck.” Moreover, her recent transplant makes it necessary for her to have regular tests. “I get a least two [tests] every month or so. This last transplant made things even more difficult to pay my student loans. It has really been hell.”
Another member of the indentured educated class, Ms. T was able to go on disability for medical problems that she attributes to the stress of owing $177,000 after obtaining a bachelor’s degree in Sociology from the University of Southern California. That mindboggling sum has mostly to do with the amount of interest (as high as 10% on the bulk of her loans) that has accrued on four loans she has through the lender ACS. In addition, Ms. T’s aunt was a cosigner on her loans, something that causes her a great deal of emotional distress.
When Ms. T’s health problems began, she was terrified that she would lose her job for being ill and missing work. After six months of being at a job she had fought hard to obtain, Ms. T began experiencing chronic bladder infections. “I had an infection that was so bad, it turned into a kidney infection. I had to go to the hospital two days in a row to receive intravenous antibiotics and other fluids. I remember worrying so much about missing work. My life depended on work, because I wouldn’t be able to survive if I lost my job. The stress of not being able to pay my loan was [overwhelming]. I could not do that to my aunt, because then she would have to pay. I continued to have chronic bladder infections for the next five years. … I would miss days of work, and I would freak out because I knew that I did no have anyone to fall back on.”
Ms. T wanted more than anything to work for a nonprofit after graduating, but instead found herself working 12 to 14 hours day in a job that caused her to develop other health problems. For instance, she had to be around loud trucks. Every day for nearly five years, she was exposed to the noise of truckers releasing their air breaks and driving over speed bumps, which caused the containers of their chassis to lift, and then drop back. “Over time, my friend and I realized that I could not hear as well as I used to. I also started having ringing and pain in my ears.” She added, “here I am, I’m 29 years old. I have chronic bladder pain that occasionally goes away. I have carpel tunnel—my hands work like a 90-year-old woman’s. I have hearing damage so my ears are like a 90-year-old woman’s, and I have so much stress and anxiety that I have panic and anxiety attacks that are scary as hell.” Ms. T has not yet defaulted on her loans, but must endure a tenuous situation as a result of carrying such a high burden of debt.
Another indentured graduate, Ms. B presents the worst-case scenario for student borrowers. “I am the first in my family to go to college, and somehow I think I would have been better off with a high school diploma.” Unfortunately, her sentiment—the regret of obtaining a degree is shared by thousands of student loan debtors, especially among those who have found themselves dealing with mounting medical care costs. It raises an important question about the cost of higher education: What does the student lending crisis look like when understood from the perspective of an individual or entire family who affected by health problems and health costs, and who are also struggling or unable to service student loan debt?
Ms. B graduated in 2003 from Belmont University with a degree in Music Business. She has defaulted on her private loans with Sallie Mae and estimates that her total debt including federal loans is approximately $87,000. “I have been unable to keep up working multiple jobs to try and pay for my rent, utilities, medications, doctor’s visits, etc. With no insurance, the prices just keep going up.”
To make matters worse, Ms. B is harassed continually by her lender. She explained, “The calls [from my lenders] got more hateful and abusive, and I began having massive panic attacks. They called me at my work, my school, my parents. This year alone, I have missed over a month of work without pay, and I have to choose between medicine that makes me well enough to go to work, or things like food.”
As Ms. B explained, fitting student loan payments into her monthly budget has become impossible, and it is clear that Ms. B did not wish for her loans to go into default. “I am an overachiever and a hard worker. I have had the same job for six-plus years. My car is a ’99. I was not raised to spend money wastefully. Nevertheless, I will never be able to have anything. Own anything. Marry anyone. I have kept my job in a horrible economy, even when many in my industry [lost their jobs as a result of] downsizing. Yet I am sick and depressed. I am scared, and feel like I am in a hole from which I will never get out.”
These testimonials are just a few that illustrate why the U.S. and its educated citizens are facing a serious and significant dilemma. Indeed, recent reports show that student loan debt has now surpassed that of credit card debt with the estimates of outstanding federal and private loans nearing $900 billion. That number alone suggests that there is a full-blown student lending crisis, but the personal stories from indentured educated citizens provide us with an intimate snapshot of the human condition for a student loan debtor. When one’s education debt burden is combined with health problems and the cost of medical care, many student loan debtors experience severe depression and even suicidal ideation.
These stories reveal to us how difficult it is to be part of the indentured educated class. All of these individuals have had the misfortune of suffering from an array of health problems, which has made it difficult, if not impossible, to pay back their student loans. On top of the physical problems they have dealt with or continue to contend with, the emotional and psychological pain has taken its toll. Again, the Obama administration has made great strides in higher education finance reform—and health care reform too. However, these testimonials from current student loan debtors indicate that more reform is needed.