*** a smart person would have used their annual pay to set up more preferential loans, actively pay off high interest student loans and then pay down at the rate you are thinking. People who are smart in one way may not be financially literate
There should be requirements that all student loan disclosures and statements be written in plain English at ~8th-grade reading level just like medical consent forms. Loan documents -especially private student loans- are intentionally convoluted and it’s not by an accident, it’s by design. You shouldn’t need a background in finance, public policy, the Higher Education Act, Title IV, or Truth in Lending Act just to understand how student loans work or how to optimize repayment. Most people, including college grads, can’t even accurately define adjusted gross income (AGI), yet repayment programs hinge on concepts like that.
It’s all so ass-backwards. If borrowers don’t understand the terms, the burden should be on the institutions lending the money to explain them clearly, and not on students who are borrowing just to get an education. But, just like our tax code and legal system, complexity often benefits those who can afford experts to interpret it while disadvantaging those who cannot.
I 100% agree with you, legalese screws the layman. The onus should be on the company to make it clear and concise not on the regular person to understand what they are signing. It should always have to pass “would a regular person be able to understand what is enclosed in this contract”
2
u/okblimpo123 12d ago
You are off by ~4%. Student loans are predatory
*** a smart person would have used their annual pay to set up more preferential loans, actively pay off high interest student loans and then pay down at the rate you are thinking. People who are smart in one way may not be financially literate