A few months ago, we wrote about how MEFA (the non-profit Massachusetts Education Financing Authority) could not find any financing to provide low interest college loans to Mass state residents. Their goal for the year was to raise $600 million from private financing, which they would then lend out to college students.
Well, things didn't improve, as you might have guessed. MEFA raised no money, and has no low interest loans to offer. Governor Patrick is trying to raise funds for the organization by getting the Massachusetts state pension fund to buy $50 million in MEFA bonds. The effort, though noble, will not come close to the $600 million they were shooting for, even if the bonds are purchased by the state.
What does this mean? Fewer kids may be able to afford college, or if they do go, will come out with much larger debt loads. They'll enter the work force (if they can find a job) and be working their butts off just so they can make their loan payments.
"Wait," you say, "I already am doing that."
Sure you are... but it's going to be worse for those coming after us. My siblings and I chose to go to state schools, and had very little debt due to our parents' diligent saving and our hard work over summers and during the school year. However, the price of state schools is increasing, and the number of students who want to attend the more affordable University of Massachusetts is skyrocketing. The more kids that want to attend, the more competitive admittance is. That leaves students who may not have had the best grades in high school (but who have plenty of potential) with fewer options.
So where does that leave us? State schools are more expensive, less well funded (which may impact the quality of the education), and more competitive. Students can't get affordable loans.
Geez. I've pretty much talked myself into a corner. I guess I should start saving for my theoretical kids' theoretical college educations... unless you have an alternative solution...?
My sister Kristen (on the left) learns how to be an artist at UMass Dartmouth