Issue №: 4 (44)
The magazine deals with the problems of the agricultural sector of the economy in the context of integration and processes of globalization. Attention is paid to the issues of development of digital economy, rural territories, technologies of enterprise management and organization of accounting, problems of legal support of economic processes, market tendencies of development of various branches of economy. Particular attention is paid to green tourism as a promising segment of the national economy.
TRENDS OF HIGHER EDUCATION LENDING IN THE USA
DZHEDZHULA Olena – Doctor of Pedagogical Sciences, Professor, Head of the Department of Mathematics, Physics and Computer Technologies of Vinnytsia National Agrarian University (21008, Vinnytsia, 3 Soniachna Str., е-mail: DzedzhulaO@ukr.net).
Lending to higher education in the world and in Ukraine is gaining in popularity. According to statistics, almost 60% of Ukrainian students study at a contract basis. The increase in tuition fees, the deterioration of the financial situation of families, and the desire of young people to obtain higher education creates contradictions, one of the ways to overcome credit education.
In developed countries, mechanisms of educational lending have been developed that provide young people with the opportunity to acquire education. It should be noted that educational loans are effective in countries with high-quality education systems that guarantee a future graduate with a reliable job security and stable salary. The United States relates to the seven countries with the best educational systems. Therefore, it is relevant to look for lending mechanisms for student youth in Ukraine to study the trends of lending education in the leading countries of the world, and in particular, in the United States.
The problem of finding out the mechanisms and causes of instability in the provision of educational loans in the United States has yet to be sufficiently highlighted in research by academics.
The purpose of the paper is to study the peculiarities and prospects of educational lending in the United States.
The cost of education in any country depends on GDP. The analysis shows a stable GDP growth in the United States. Expenditures on education and higher education have a certain degree of stability as a percentage of GDP. Thus, in comparison with 2016 this indicator in 2017 and 2018 increased by 0,1% and amounted to 5,1%. In 2019, expenditures are expected to increase by 0.1%, and in 2020 - by 0.2%.
The indicator of expenditure on higher education in relation to GDP also does not have a sharply pronounced tendency to increase. In 2016, total expenditure on higher education as a percentage of GDP amounted to 1.7%, and in 2017 and 2018, this figure dropped to 1.6%. In 2019 and 2020, higher education expenditure relative to GDP is projected at 2016 (ie 1,7%).
Such a state of education financing leads to an increase in tuition fees and updates the issue of education lending. The main reason for the increase in tuition fees economists consider inflation processes, which are an integral part of a market economy. The average tuition fee in 2018 increased by $ 250 (by 2.5%, respectively, the inflation rate is 2.9% in 2017). At the same time, the average federal payments per student were reduced. Consequently, you can confidently predict the increase in fees and in subsequent years.
In US education lending programs, you can select 3 types: federal, private, parent.
The greatest demand is federal loans. The most popular types of education loans today are Stafford Federal Student Joan and Federal Perkins Loans For College Students. The average loan amount is 21 thousand dollars. The most important advantage of these products is the possibility of repayment after the university graduate begins to work. Compared with loans for education in Ukraine, the lending rate for American students is much lower and ranges from 5-7%, and the maturity of the loan may reach 30 years. The peculiarity of these loans is that they are issued not only to the student's education, but also to his life.
Stafford's federal educational loan is more widespread. Its advantages are low interest rate and flexible repayment system. However, the maximum amount of a loan can only be provided if the requirements of this program: success, full-time education, the borrower must be a US citizen.
Experts believe that a significant percentage of students do not receive federal loans owing to insufficient information support for federal educational credit programs and formalities for their registration.
A simplified procedure for private student loans facilitates their active dissemination. Private lenders work directly with borrowers and are personally interested in distributing this type of banking product. The reasons for reducing educational loans should be considered as problems in debt repayment. As of March 2018, 52% of the outstanding debt on federal education loans amounted to 14% of borrowers worth $ 60,000 or more; 56% of borrowers with outstanding debt owed less than $ 20,000.
Student loan arrears rank second in the structure of Americans' loan debts and exceed $ 1.4 trillion, which negatively affects the US economy.
Consequently, the United States has the most advanced system of educational lending, which is a powerful incentive for higher education, and ensures its availability to the wages of people with different levels of income. For students, three types of educational loans are offered: federal, private, and parenting. The lowest interest rates may be obtained through a federal educational loan. The last 3 years are characterized by a decrease in educational loans The reasons that led to a decrease in the use of federal loans were the lack of awareness of students about this kind of lending, strengthening control over the implementation of loan agreement conditions.
The provision of educational loans in the United States is associated with a sharp increase in their arrears, which may lead to a financial crisis. Therefore, the development of mechanisms for their return becomes an economic problem that requires urgent resolution. We consider the prospects for further research with the study of debt relief programs in the United States.
- Stoyko, O.YA. (2014). Finansova pidtrymka vyshchoyi osvity v SSHA [Financial support for higher education in the United States]. Naukovyy visnyk Uzhhorodsʹkoho natsionalʹnoho universytetu – Scientific herald of Uzhgorod National University, 29, 213-216. Retrieved from: https://dspace.uzhnu.edu.ua [in Ukranian].
- Romanovsʹkyy, O.O. (2015). Derzhavna polityka SSHA i Velykobrytaniyi shchodo pidtrymky rozvytku vyshchoyi osvity [State policy of the United States and Great Britain to support the development of higher education]. Derzhavne upravlinnya: udoskonalennya ta rozvytok – Public administration: improvement and development, 12. Retrieved from: http://www.dy.nayka.com.ua DOI: 10.32702/2307-2156-2018.11.27 [in Ukranian].
- Tarasova ,O. (2011). Vyshcha osvita v SSHA: suchasnyy stan ta priorytety rozvytku [Higher education in USA: current state and development priorities]. Visnyk Natsionalʹnoyi akademiyi Derzhavnoyi prykordonnoyi sluzhby Ukrayiny – Bulletin of the National Academy of the State Border Guard Service of Ukraine, 3. Retrieved from: http ://nbuv.gov. ua/UJRN /Vnadps_2011_3_9 [in Ukranian].
- Kalinina, O.G. (2015). Systema upravlinnya yakistyu osvity u VNZ SSHA [Quality Management System in US Higher Education]. Candidat's thesis. Starobilsk, 168 p. [in Ukranian].
- Vdovenko, L.O. (2018). Metodychni pidkhody otsinky efektyvnosti kredytnykh vidnosyn [Methodical approaches to assessing the effectiveness of credit relations]. Ekonomika ta suspilʹstvo – Economy and Society, 17, 518-523. Retrieved from http://economyandsociety.in.ua [in Ukranian].
- Floyd, D. L., Rivka, A. F., & Ramdin, G. (2015). A retrospective of four decades of community college research. Community College Journal of Research and Practice, l.40 (1), 5-22. Retrieved from https//www. tandfonline.com /doi/abs/10.1080/10668926.2015.1086707. https://doi.org/10.1080/10668926.2015.1086707
- Gatto, J. T. (2001). The underground history of American education: A schoolteacher’s intimate investigation into the problem of modern schooling. New York, USA: Oxford Village Press (eng), 234. Retrieved from: https: // ww. amazon. com/Underground-History-American-Education-Investigation /dp / 0945700040.
- Jeynes, W. H. (2007). American Educational History School, Society, and the Common Good. Thousand Oaks, CA: Sage Publications, Inc., 23-68. Retrieved from: https // ww. amazon. com/Underground-History-American-Education-Investigation /dp / 0945700040.
- https://doi.org/10.1080/15507390903584721
- A report to the senate and house appropriations subcommittees on higher education [web-site]. mmi. senate. michigan. Retrieved from http: //www. senate. michigan.gov/sfa/Publications /HiEdApprops / HiEdApprops_MostRecent.pdf.
- Bureau of Labor Statistics (2019): [web-site]. Retrieved from: URL: https://www.bls.gov/.
- More than 1 million people default on their student loans each year. mmi. cnbc.com. Retrieved from: https: //www. cnbc.com /2018 /08/13/ twenty-two-percent-of-student-loan-borrowers-fall-intodefault. html.
- How to avoid default, credit damage and extra fees when you can’t pay student loans [web-site]. mmi. debt.com. Retrieved from: URL: https: //www. debt.com/ student-loan-debt /cant-pay-student-loans. https://doi.org/10.17848/9780880994873.ch12
About journal
051 Economics
071 Accounting and taxation
072 Finance, banking and insurance
073 Management
075 Marketing
076 Business, trade and exchange activities
241 Hotel, restaurant and catering
281 Public administration
The journal “Economy, finances, management: Topical issues of science and practice” is included in the "List of Scientific Professional Editions of Ukraine".
The scientific edition is assigned the Category "Б" in the field of economics in specialties 051, 071, 072, 073, 075, 076, 241, 281
(Order of the Ministry of Education and Science of Ukraine No. 249, March 17, 2020).
The journal “Economy, finances, management: Topical issues of science and practice” has a Digital Object Identifier (DOI)
The journal “Economy, finances, management: Topical issues of science and practice” is indexed in such database as Index Copernicus Value (https://journals.indexcopernicus.com/search/form)
The editorial board of the journal is guided by the principles of scientific, objectivity, professionalism, informational support of the most significant innovative researches, observance of standards of publishing ethics.
The purpose of the journal "Economics, finances, management: Topical issues of science and practical activity» is the coverage of leading scientific ideas in the economic, financial and management activities of the sectors of the national economy and the involvement of representatives of the domestic and foreign scientific professional community.
Objectives of the journal:
- publication of research findings on innovation in the economy, financial and management spheres, innovation of production processes;
- expanding partnerships with international scientific publishing organizations;
- enhancing the culture of reviewing and annotating published material;
- adherence to editorial ethics.
Article publishing is a paid service. Cost for printing in professional publications in accordance with the Decree of the Cabinet of Ministers of Ukraine of August 27, 2010 No. 796 "On approval of the list of paid services that can be provided by state educational institutions, other institutions of the educational system belonging to state and communal ownership" and the order Rector of the Higher Education University Mazura VA dated March 14, 2018 No. 93 “On setting the cost of printing in professional editions of the University”.
The cost of printing one page in professional editions of the university is 60 UAH.
An additional copy of the magazine with the mailing list costs 450 UAH.
Recipient: Vinnytsia National Agrarian University MFO 820172 Current account No. 31256282102055 Code 00497236 Bank State Treasury Service of Ukraine, Kyiv. VAT payer code 004972302286. Registration number 100271744. Purpose of payment: for printing an article in the journal: ”Economy, finances, management: Topical issues of science and practical activity "
It was founded in 1997 under the name "Bulletin of the Vinnytsia State Agricultural Institute". In 2010-2014 he was published under the title “Collection of scientific works of Vinnitsa National Agrarian University”.
From 2015 ”Economy, finances, management: Topical issues of science and practical activity” (Certificate of State Registration of Mass Media No. 21154-10954 of PR as of December 31, 2014)
According to the decision of National Council of Television and Radio Broadcasting of Ukraine from 25.04.2024 No. 1337 the scientific journal «Economy, finances, management: topical issues of science and practical activity» has the ID of the Media R30-05171.
