By Josh Teti, Princeton Mortgage Wholesale
When I was in high school, there was basically 2 options after graduation, 1) go to college, 2) go to a technical school and enter a trade industry. I would say the majority of my friends (90% or so) went to college, chose a major, graduated, and are now working at a job or in an industry that has nothing to do with their major. Additionally, I would say that 90% of that 90% are paying back student loans that they needed to take out (because most people don’t have hundreds of thousands of dollars just laying around) and if they weren’t able to find a decent paying job right out of college, they’re most likely struggling to pay those loans. And what’s funny is that at the time, at least in the business college that I attended, it was a common conception that in order to get that high paying job or work for that big company, I needed to borrower MORE money and go BACK to school, AKA get my MBA. Fast forward 5-6 years after high school graduation, and most people are working at a job in order to pay back loans that they needed in order to get the required degree to get that job. There are millions of people in this same scenario. It doesn’t make sense to me. There has to be a legitimate alternative, right? Well how does this sound…
“One Year of ‘College’ With No Degree, But No Debt and a Job at the End”
That’s the name of this article from the Wall Street Journal. It talks about a new trend called “college alternatives” … here’s the premise: students spend about 40-50 hours a week for 14 weeks enrolled in free courses that teach skills in hot areas (tech, computer engineering, digital communications) that have guaranteed apprenticeships and create a direct pipeline to well-paying jobs after graduation. The students then payback the school through a percentage of their income for the first few years after graduation. And that’s it. The idea is that by those few years after graduation, the “student” is left debt-free with a well-paying job in the specific area or industry that they obtained education in. No, they don’t technically have a “bachelors” degree or a major that they can list on their LinkedIn profile, but companies are starting to glace over that requirement and are looking at life experiences and true skill sets that fit into their company’s culture which is becoming the norm during hiring and recruiting.
My prediction is that the next recession is going to be mainly caused by defaulted student loans – plain and simple. College tuition has been trending upwards and more and more people are not going to be able to pay back their student loans. If these college alternatives become a legitimate option after graduation, we can stop setting up students and recent graduates to fail and start helping them develop a career from the get.
Photo by Honey Yanibel Minaya Cruz on Unsplash
The opinions expressed in this post are the sole view of the writer and do not reflect the opinion of Princeton Mortgage Corporation.