University of Wisconsin students have an average debt of almost $28,000 upon graduation. Students should not be financially penalized for seeking to better themselves through higher education, and a bill proposed this summer would ensure that.
The second public hearing to discuss a bill that would lead to the creation of the Wisconsin Student Loan Refinancing Authority took place Wednesday. This bill and the commission would make Wisconsin the first state in the nation to allow refinancing of student loans at lower interest rates.
Legislators, citizens discuss potential option to refinance student loan debt
The WSLRA would ensure low interest rates would keep students away from private lenders who could potentially take advantage of them.
Senate Bill 194 would also expand the definition of tuition expenses. Under current legislation, many integral parts of student life are not taken into account during the student loan process. By expanding the definition of tuition expenses to include the cost of living such as books, school supplies and housing, the actual expenses of college students would become more consistent with expenses recognized by Legislature.
This expansion of tuition expenses would make more students eligible for income tax breaks while trying to pay off their student loans.
According to Fox11 News, average students would see a $179 tax savings, and people with higher student loan payments would see as much as $531 in yearly tax savings. This bill seems like a no-brainer.
The WSLRA would require institutions of higher education, such as UW, to offer loan counseling for students. Counseling would provide information about the terms and responsibilities of a loan, repayment or prepayment options and the consequences of defaulting on a loan. Teaching students the requirements of their loan and how to manage payments is a skill that is transferable to other aspects of post-college life.
For students, this bill could offer financial help to a large group of students.
WSLRA would make paying off student loans easier. Rather than our money going to pay high loan interest rates and taxes, it would go to paying off our principal on student loans. The bill’s supporters believe that students who graduate with less student loan debt are more likely to spend money on things like cars or houses, which would benefit the overall economy.
Lastly, three UW students would be board members on WSLRA, making students a part of the process. Giving students a voice, ensures that they have input in their economic future.
With any luck and Senate Bill 194, students of higher education institutions in Wisconsin will spend less time digging themselves out of debt and more time contributing to the overall economic success in our great state.
Sam Vander Plas ([email protected]) is a sophomore majoring in communications.
