Student Loans Can Be Perilous. Here’s a Better Way to Pay for College.

[OfTheCross]

Student loan debt keeps growing.

There is a better solution than the ones politicians offer, which stick the taxpayer or the loan lenders with the whole bill.

It’s called an “income share agreement.”

Investors give money to a college, and the college then gives a free or partially free education to some students. When those students graduate, they pay the college a certain percentage of their future income.

dailysignal

I heard about this on the radio before. It's essentially a like a stock market, actually, moreso like a mutual fund of people attending college.

We invest, and they pay out.

[Hoodat]

There is a better solution than the ones politicians offer

This is ALWAYS true.  There is ALWAYS a better solution than the ones politicians offer.  Of course in this case, colleges aren't interested in creating a solution for the burden of student tuition costs as long as government keeps shelling out big bucks to them.  There is already a system in place where people can donate money to colleges.  It is called an endowment fund.  But colleges sit on their endowments while continuing to raise tuitions because they know government will keep paying more and more.

And now that Democrats are offering to pay all college costs for those who are least willing to take responsibility for their actions, expect tuition costs to rise even more.

The problem here is government doing what it does best - destroying the free market.  If government ended its monopoly on student loans and got out of the subsidy business, tuition rates would fall because of competition.  Of course you would no longer have professors drawing half-million dollar salaries for teaching two classes.  But the invisible hand would create greater choice (and value) for students.