College graduation: A diploma in one hand and a heap of debt upfront.

College is believed to be the next step after high school; it is assumed to be where you become a well rounded individual and educated to get out in the real world to earn money and pay for the life that you vision of.

This is not so much the case when the economy has gone unpleasant.

I just witnessed firsthand a college graduation; I graduated with my B.B.A. on Saturday. Looking at the future is scary, and not having a job is worse. I will be taking classes through the summer, but August will be here in no time and I will be expected to have something lined up so I can start paying my $30,000 in student loans.

Luckily, I have been lucky enough to be able to make it through college with just student loan debt and not credit card debt. A recent report has indicated that many students are graduating college with around $7,000 in credit card debt and much more dues in student loans. So of course the rate of default on student loans has increased in the past year.

The entire situation of hundreds of thousands of people graduating is exacerbated by unemployment and employers being far more picky about whom they hire. After looking for jobs in marketing, I have realized that if you do not have at least 3 years of experience in the field, you are not likely to find something right out of college at a marketing firm (unless you graduated with highest honors it seems).

There is some optimism though; in July a brand new federal program will go into effect that allows graduates to cap his or her monthly loan payment to 15% of his or her income. While the program was produced to give some relief to those who go into lower paying industries like teaching, it will help out everyone. Another advantage to this program is that in some sectors, public service loan forgiveness will go into effect after 10 years of payments; all graduates loans will be forgiven after 25 years of payment.

I can not picture still paying back loans after 25 years. I am for myself hoping to have my loans paid off in 10 if all goes well. I would love to have them paid off sooner, but I have to make sure that the bills are paid first. I think this is where the problem is coming from when students graduate. Like me, they live with their significant other or spouse, or are on their own and have to make sure that they have a place to live rather than lose sleep about student loan payments.

However, it looks like this federal program will be helpful to graduates that will have a tricky time paying back their student loans because of extra financial obligations.

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