Are the Kids Really All Right?

Sandra Knisely:

As the cost of higher education increases, campus experts debate how to protect students from making disastrous choices — and explore whose responsibility it is to do so.

“This is insane.”

That’s what Susan Fischer ’73, ’79 told an out-of-state father when he called the UW–Madison Office of Student Financial Aid to discuss taking out a loan package totaling almost $160,000.

The response? “He said, ‘I appreciate your opinion, but our children want to go [to the UW], and we’re going to let them,’ ” says the office’s longtime director.

For the UW experts who study or work closely with student borrowers, discussions about debt usually lead to discussions with and about parents. After all, the current federal financial aid system is built on the assumption that parents will provide their college-aged children with at least some measure of financial support until age twenty-four. Yet for students who come from families less adept at financial decision-making, the existing student-loan structure can put them at a disadvantage.

A growing number of UW researchers are focused on developing a better understanding of the impact of indebtedness, both on the well-being of individual students and on the system of higher education as a whole. For example, School of Human Ecology Dean Soyeon Shim is overseeing the first longitudinal study of its kind to track the effect of financial literacy and indebtedness on young-adult well-being. And Nicholas Hillman, an assistant professor of educational leadership and policy analysis, is developing ethical frameworks for college financial-aid strategies and policy recommendations related to student loans.