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Student Loans: Debt Hits $1.2 Trillion

First Posted: Oct 05, 2015 04:28 PM EDT
student debt loans protest

Photo : Bernard Weil/Toronto Star via Getty Images)

U.S. student debt is now at $1.2 trillion and is hurting both parents and students as large school loans span multiple generations.

Nathan Anderson, an owner of an acupuncture clinic in Tucson, Arizona, compared paying off school loans to paying a second mortgage. He tells the Associated Press that he and his wife spend more on paying off loans than on "groceries" for their family of four.

An AP analysis of Fed data shows that student debt is surpassing groceries as a primary expense. Reports also show that families with teenagers are struggling to save their children's education because of parents who still owe on student loans. Meanwhile, a recent study released by Gallup-Purdue Index revealed that only 1 in 3 grads with debt strongly agreed that their education justified the expense. Grads from Ivy League and prestigious schools were more satisfied with their degrees.

The study shows that 52 percent with degrees from public universities strongly believe their education justified the expense compared to 47 percent of people with degrees from private universities.

"Given that higher education has become one of the largest financial investments a person will make over their lifetime, it's a bit alarming that only half of all graduates strongly agree their education was worth the cost," Brandon Busteed, Gallup's executive director for education and workforce development tells CBS News.

"Clearly, we all need to work harder on improving quality and reducing cost as much as possible," he added.

Students are paying off more than the amount they had taken out because of high interest rates on loans. Some people were lucky enough to get scholarships or start off in community college to save money.

Nearly six million Gen X borrowers still owe loans. Going to college promised a better future and guaranteed entry into the middle class, while taking out loans meant that they would get a job right away that will help pay back loans quickly.

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