Get ready for some good news, college students! The student loan business is a-boomin according to USA Today.
The federal government made enough money on student loans over the last year that, if it wanted, it could provide maximum-level Pell Grants of $5,645 to 7.3 million college students.
Bad news is that isn’t happening. And you’re not getting any of the $41.3 billion profit. And we shouldn’t even really be calling it profit because according to Education Secretary Arne Duncan, “It’s actually neither accurate nor fair to characterize the student loan program as making a profit.”
But still, this thing we aren’t calling a profit is bigger than profits at all but two companies combating for your hard earned cash.
The $41.3 billion profit for the 2013 fiscal year is down $3.6 billion from the previous year but it’s a higher profit level than all but two companies in the world: Exxon Mobil cleared $44.9 billion in 2012, and Apple cleared $41.7 billion. (via)
That’s just swell. Isn’t that just swell? Don’t worry, Congress will soon be handling this issue and fixing it in the coming months. Just like they solved the debt crisis.
This summer, Congress passed a law tying interest rates on loans to the market. The law set rates for all the loans at different levels, but based them all on the 10-year U.S. Treasury rate and allowed rates to change each year…While offering immediate relief to students, those rates are expected to rise in coming years and give the federal government $175 billion in profits from student loans over the next decade. (via)
None of this is stressful or depressing at all. My advice? Just keep moving forward. Buy things, watch movies, plow through Netflix. It’ll all be fine. Let’s all go get a credit card.