Due to the actions or inactions of Congress, the loan rates for the subsidized Stafford loans doubled from 3.4% to 6.8%. This only affects loans originated on or after today, July 1, 2013. Of course, there is much gnashing of teeth about this increase and the extra cost that college students will need to bear because of this.

Some articles will tell us about the extreme examples. Students who have multiple degrees and have acquired more than a quarter million dollars in student loan debt and how crippling this can be. However when you dig a little further into the story, you see bits come out like the average student loan debt upon graduation is about $27,000. Remember here, the old interest rate is 3.4% and the new rate is 6.8%. These numbers sound an awful lot like a car loan. People today often buy a car for $27,000 and have an interest rate in the sixes.

However, we have a couple significant differences here. For one, students get ten years or more to pay off the education debt. For a car, the standard today seems to be somewhere in the 4-6 year range. So the monthly cost is much lower for the college loan.

Additionally, there is the difference in what you’re getting. With a car, you get something tangible, but it also depreciates immediately. There is the old axiom that cars’ value is cut in half the minute it leaves the showroom floor. A college education doesn’t depreciate in value. A college education is what you can use to get started in your career. The real problem here may be whether the 18 year old and their parents chose the right college and the right academic program. I understand that college is not simply a trade or vocational school. There is more to college than simply learning a trade. You learn a great deal more if you really are open to all experiences while at college but you do also need to have an eye to the future. Not to pick on specific majors but if you rack up $200k in debt to get a bachelor’s degree in religious studies or history, how can you really recoup that? By going to grad school? If that’s the case, then maybe a cheaper undergrad makes sense and then go to the more prestigious graduate school and save some money?

But really, can we go easy on the “sky is falling” stuff because we have 22 year olds with a freshly minted college diploma and $27,000 of debt? Didn’t they go to college so they can get a job and work for the next 40+ years or so? Maybe they live a little rough around the edges for a few years, pay off the loans and by then they’ll be in a position to buy houses and become more stable. When did the house, two point two kids, the dog and the picket fence get promised to 23 year olds? Or is this just another example of the instant gratification generation? Or maybe I’m just getting older and crotchety.