Recently, the Pew Hispanic Center shared 5 Facts about Latinos and Education. One of the most interesting aspect of these trends is the progress in the number of Latinos enrolling in postsecondary education. Since 1993, the number of Latinos enrolled in postsecondary education has nearly tripled, from 728,000 to 2.2 million in 2013. This staggering growth can be attributed to the push and pull factors that impact a young Latino's decision to pursue a degree. Young Latinos are often pushed toward higher education through the support of mentors, family members and dedicated college access professionals. The desire to achieve the symbols of the American Dream- a stable job, a home and a secure future often pulls young Latinos to pursue a postsecondary education.
Although the cost of higher education continues to rise, it appears that more and more Latinos believe that college is worth it. Indeed, research indicates individuals that complete postsecondary education earn higher wages, live longer and are more civically engaged. These tangible benefits are evident for all individuals that complete a postsecondary degree. A recent report, however, provides a deeper analysis of how a college degree shapes the long term financial well-being of Latinos.
A growing number of Latino college graduates face financial insecurity. Nearly sixty percent of college educated Latinos find it difficult to pay bills and cover basic living expenses. In addition, over half (56%) of college educated Latinos have not begun to think about saving for their futures.
In many instances, college educated Latinos cannot pay their monthly expenses and save for retirement because of the choices they made in college and soon after. The majority of college educated Latinos are faced with the burden of paying back massive debt. Nearly half (48%) of all college educated Latinos say that they have too much debt, with the majority (51%) engaging in expensive credit cards behaviors like paying the minimum amount or being charged a late fee. With an average of $49,700 in undergraduate debt, the cost of going to college is becoming a greater factor in the financial hardships of Latino college graduates.
Increasing financial hardships and limited financial literacy are a dangerous combination for college educated Latinos. A large number of college educated Latinos have limited knowledge of how to navigate complex financial systems. Although a majority have a basic understanding of bank accounts, credit cards and loans, they lack knowledge surrounding investments and real estate.
The results of this analysis underscore a clear message: for the Latinos that do make it through college, simply having a postsecondary degree does not guarantee a financially secure future. In a time when the cost of higher education will only continue to increase it is important that while in college Latinos have the resources and support to begin to make the right financial decisions. State governments, the federal government, institutions of higher education and K-12 education all have a role to play in making this goal a reality.
Part II of this blog will focus on how to improve the financial well-being of Latino college graduates.
This blog was also recently published by Latino Rebels.