It has been established that one of the biggest drivers of the debt for the US economy is the staggering amount of student loans that have continued to grow exponentially in recent years. Over the past decade or so, students in colleges and universities amassed huge amounts of loan debt that contributed to the federal budget deficit.

There are quite a few reasons why student loan debts in the US have kept climbing and have nearly ballooned out of proportion. There is no gainsaying the fact that the universities and colleges themselves contributed enormously to the debts owed by the students. These institutions use financial aid as a ‘bait’ to attract students who eventually apply for and are awarded far more funds than they actually need for their educational expenses.

After getting the awards and shortly before the start of classes, some students make a deliberate and tactical withdrawal from all classes. These students end up not using the loan for the purpose it was originally intended.

Unfortunately, there is no ‘oversight’ put in place by these institutions to guide or monitor the students how they use their loans probably because they are independent adults.

What is lacking here is an inclusion of some form of financial education in the curriculum of middle or high schools. Subjects like bookkeeping or accounting should be made one of the core subjects in all middle and high schools.

When you teach young kids who are still in their impressionable age the basic principles of how to balance income and expenditure on a balance sheet, how to create a simple budget, the concept of debt, deficit, and surplus etc, they will not only imbibe the knowledge and cherish the value of being on the positive side of the equation, they will also always like to apply this knowledge of financial education in all ramifications of their adult life.

In essence, what I am advocating is that bookkeeping/accounting should be made compulsory and counted as one of the core subjects. Think about it this way, a young adult who has been exposed to basic instructions in bookkeeping or accounting right from secondary school will get to college imbued with financial discipline.

When young adults in schools and colleges are thus financially disciplined, they will not abuse the financial aid system. Rather, they will view the word ‘debt’ as a scourge or an anathema to be avoided at all costs.

If and when this value is ingrained among the youth in their microcosmic school environment, the resultant effect is that the much-needed financial discipline and sanity will gradually permeate our macrocosmic society.

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