President Obama has initiated a major, beneficial revamp of the student loan consolidation project. The only downside is it applies to students starting college in 2014. 

Seeking out higher education is usually viewed as a way to better yourself financially in the long run and broaden your mind. Alas, the cost of seeking out said education has become staggering. This means we all end up taking out student loans to pay for the privilege, loans that require repayment that can be shocking.

We’ve reached a financial tipping point when it comes to college education. College costs so much now that most graduates cannot afford to repay the loans they had to take out to pay for their education. The problem has become so massive, that a new type of loan program was instituted a decades ago – the student loan consolidation. The idea was you could stretch out the term of the loan to greatly reduce the monthly payment. It worked for a bit, but even this is not enough in many cases now. 

The federal government has cut out the middleman when it comes to student loans. In doing so, it has taken control of the financing. This was supposed to lead to red tape boondoggles and may yet, but so far the changes being made by the government are brilliant. One is to the student loan consolidation program. Qualifying students will be allowed to limit their monthly payment to 10 percent of their income, a number that is usually much less than a normal consolidated payment. If they make payments consistently for 20 years, they can then walk away from the remaining balance without any negative effects. Not bad, eh? 

Alas, there is one problem with this new consolidation program. Despite being part of the Health Care and Education Reconciliation Act of 2010, the consolidation program change doesn’t kick in until 2014. Only loans originated in that year or later will qualify, which doesn’t exactly help students in the next four years. Still, it is good news down the line for an education system that is simply out of control.