Student Loan Debt Petition
To our kids, college graduation is the first step toward achieving the American Dream. But too many of our nation’s college graduates face a student loan debt that will crush those dreams.
The current Federal Student Loan program asks young college hopefuls to make decisions that will significantly impact their finances before they know how to balance a checkbook or calculate interest. The Federal Student Loan program itself is not the problem. That program has given millions of youth a chance to attend college and, with just minor adjustments, it can continue to benefit college hopefuls for many years to come.
Student loans have grown to a $1 trillion bubble that’s already hurting the U.S. economy. If the bubble bursts, national debt crisis can result. We should be approaching this problem proactively—by ensuring that our kids have personal financial skills before they sign off on a huge student loan.
We don’t want our kids’ dreams to turn into a debt sentence. Sign this petition now to support a system where college-bound youth under 18 years old must graduate from a personal finance course prior to entering into Federal Student Loan debt. This program encourages responsible borrowing that protects our country and helps give youth the opportunity to achieve their personal American Dreams.
Sign the Petition: Become Part of the Solution
Countless research studies have made it common knowledge that today’s youth lack basic financial skills. Students entering college cannot rent a car or legally drink a beer. Is it right to ask them to sign loan documents committing to year or even decades of debt? Seriously: what does an 17-year-old know about loans, paying bills, and accumulating interest?
What we advocate is that students have the basic knowledge to understand what they’re signing. They need to know the risks and potential impact of student loans on their future lives. Our solution is as simple as adding one stipulation to the Federal Student Loan documents.
Goal of the Petition: The goal of this petition is to show support for a program that requires youth under 18 years old to complete financial education coursework before they commit to a Federal Student Loan. This program will improve the financial capabilities of our nation’s citizens, reduce student loan debt and default rates, and protect the fragile U.S. economy from another bubble implosion.
Making change happen takes all of us working together toward a common goal. The National Financial Educator’s Council (NFEC) proposes a three-step approach:
Step 1: Free Market. We’ll use the petition as leverage to open up lines of communication and influence change. The NFEC draft model proposes a free market solution that makes economic and moral sense. It’s a win-win for all parties:
- Students win because they understand what student loan debt means to their futures.
- Parents win because their kids are protected and learn financial skills that can improve their lives.
- Colleges win with reduced dropout rates and financially responsible students.
- Lenders win with fewer loan defaults and positive public attention.
- The financial literacy movement wins as the country avoids a debt crisis and more kids become financially savvy.
Step 2: Legislative Influence. The NFEC has drafted legislation called the College Student Protection and Financial Education Act to enlist politicians in the effort to proactively address this national crisis. This legislation proposes a preventive model similar to the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, which requires people to get budget counseling before they can file bankruptcy and financial education after they file.
Step 3: High-profile Awareness. Change takes time. But a high-profile awareness campaign helps move change forward faster. The NFEC will employ the tried-and-true campaigning strategies that have made them a leader in promoting financial literacy to raise awareness for this effort.
In collaboration with industry experts, the NFEC has already drafted educational standards, text of the legislative bill, and a business model to serve as a foundation plan for further development. These draft plans are available to view, and we want to improve them by asking you to add your ideas. We will use this open source model to leverage intellectual input from people with passion and expertise to contribute toward improving our youth’s financial capabilities.
We encourage you to contribute your expertise to the plan. You will receive recognition for any ideas you share.
Thank you for taking action! Together we can help today’s students avoid excessive student loan debt and gain the personal finance knowledge that can have a positive long-term impact on their lives.