Program provides education plan
Published: Wednesday, June 20, 2012
Updated: Wednesday, June 20, 2012 15:06
Last month, the U.S. Department of Education rolled out a new initiative, the College Savings Account Research Demonstration Project. The project falls underneath the Gaining Early Awareness and Readiness Undergraduate Program, which provides advising as well as discretionary and competitive grants to low-income students to help prepare them for college. The project will allot more than $8.5 million to 10,000 students in the GEAR UP program to establish college savings accounts in order to determine if these savings accounts increase the probability of students attending college.
Students will initially receive $200, and each student’s savings will be matched monthly throughout their high-school tenure. This not only provides students with an incentive to save but also places partial responsibility on students to follow through, which is an important aspect of preparing for college.
The program as a whole is a solid initiative that should be applauded, not scrutinized. Young students should utilize the program as an alternative to accumulating a mass of student loan debt, and the program should effectively empower students to plan for college despite financial constraints that may deter them. Many students who don’t qualify for financial aid turn to private loans and are still strapped throughout college. Even students who do qualify find that aid doesn’t cover all of their tuition and books let alone leave wiggle room for emergency situations.
Antony Davies, senior scholar at the Mercatus Center at George Mason University, and James Harrigan, a fellow of the Institute of Political Economy at Utah State University, compared the student-loan deficit to the housing bubble, stating that it also holds unforeseen consequences.
“And just as home buyers took out loans to speculate on houses they could never hope to afford, students are taking out loans to cover educations they often cannot complete and which often do not hold value in the market even when completed,” Davies and Harrigan wrote in U.S. News. “Government meddling has again separated profit from risk. Universities get to keep the tuition profits while taxpayers are forced to shoulder the risk of students not paying back their loans.”
In 2010, for the first time ever, the amount of student-loan debt surpassed the amount of consumer credit card debt in the U.S., and it’s becoming apparent that students aren’t even benefitting from these financial burdens. Data collected by the Organization for Economic Co-operation and Development confirms that the U.S. ranks last out of 18 countries with regard to dropout rates, with only 46 percent of students completing college. Not only are students saddled with debt, but they’re not even completing the degree they went into debt to obtain.
The GEAR UP program provides students with a way to prevent the disaster that accompanies student loans. Even UCF students and students at other Florida colleges can attest to watching their Bright Futures scholarships shrink throughout their undergraduate careers and having little other choice besides loans. Many students can also relate to feeling lost when it comes to applying to colleges and receiving accurate information about financial assistance; a program like GEAR UP, which begins as early as middle school, will create more efficient and driven students that aim for higher education. In the long run, the program will create more opportunities for students to complete higher education, in turn producing a more well-rounded and capable workforce.
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