Makeover needed: Student loans
Fannie Mae and Freddie Mac were recently taken down for (among other things) taking advantage of the all the market had to offer for returns while meanwhile cashing in on a government backup for its loans. But their cousin Sallie Mae and lots of other private student loan lenders are still playing that game.
While some rates, even on existing student loans, have come down, many have not. My husband consolidated his law school loan shortly after graduating. He's stuck paying 9% for the rest of the loan.
private student loans are discharged in bankruptcy.
One again we've turned capitalism on its head: companies take no risk, but get paid. The government takes the risk, but doesn't get paid. Students graduate with way too much debt. We now expect them to start saving for retirement in their 20s. In fact with Social Security in jeopardy and pension plans disappearing, they better start when they're young. But there's just no way they'll be able to with these enormous loan payments.