http://www.fins.com/Finance/Articles/SB … 2-500-JobsSLM Corp., known as Sallie Mae, is expected to cut 2,500 of its 8,600 jobs, according to The Wall Street Journal.
The announced downsizing comes as a bill is signed today to overhaul the college student loan market, a Journal op-ed reported. Part of the plan is to cut private lenders from subsidized student-loan programs.
The Reston, Va.-based student lender also plans to close up to 20 of its 25 U.S. office centers.
Rutgers, the state school of NJ, is ranked as one of the best state schools in the country and was ranked by Forbes as the 20th best public school for getting rich. For the in state tuition of about $10,000 a year it's a pretty good investment and it's where I'm planning on getting my masters. I keep pretty good contact with a few friends who go there and most of who pay for their schooling through student loan programs.
Now I lets take the $10,000 number and assume that a student decides to pay off every year of their 4 years of schooling with a student loan. In total it comes out to $40,000 for 4 years, much less than a sports car and manageable depending on how long you finance it for. Now of my friend who goes to Rutgers financed his student loans through SallieMae for 30 years, so he makes $100 payments per month while in school and plans to wipe out his student loans after getting a job after school. The $100 he pays per loan is enough to cut off the interest and take a little bit of the principle amount off.
Considering that the program seemed to work well for him and the other people I know who use SallieMae, why is there still such a huge movement for asking the government to forgive student loan debt as well as cut banks out of the loop? The programs seemed to work fine for the students and kept thousands of people in work. Aside from that its not like cutting SallieMae out is going to make college more accessible or cheaper, it just makes people deal with the government bureaucracies instead of well managed companies.
Can anyone explain to me why the system need to be changed?