Mar 15 '17

Slaying the Debt Dragon

Ryan Foss
Ryan Foss
Managing Director of Innovation

National student loan debt has reached more than $1.3 trillion, with 44 million borrowers. This type of debt differs from other types of debt such as home mortgages, primarily because borrowers don’t often see the full picture of what their debt will amount to and the impacts that it may have on their lives until it’s too late.

But your credit union can be the hero -- the financial partner -- your members need now. By signing on to test Debt Dragon, you can help your members tame the beast of student loan debt.

Ryan Foss
Ryan Foss
Managing Director of Innovation

National student loan debt in 2017 has reached a nearly unimaginable amount – more than $1.3 trillion, shared across 44 million borrowers. What does that even look like? Well, it comes out to an estimated $37,172 per borrower for the graduating class of 2016.

This type of debt is different than other types of debt such as home mortgages, primarily because borrowers don’t often see the full picture of what their student debt will amount to and the impacts that it may have on their lives for the next 30+ years—until it’s too late.

An unbeatable enemy?

A financial planner recently told Business Insider that the most common money problem she sees among her 20-something year-old clients is that they don’t fully understand the debt they’re taking on until later.

"A lot of people in their 20s come in [saying] 'I wasn't really aware how much I was borrowing from student loans and I wasn't aware how much that would affect my life for the next 30 years,'" Katie Brewer, the Dallas-based CFP, told the publication.

A credit union hero?

Credit unions – this is your wake-up call – I’m telling you #DontHitSnooze, it’s time to double down to help your members, who statistically speaking, are likely to be suffering from the sting of student debt. Meanwhile, many more of your members are continuing to enter situations where they are setting themselves up for student loan debt shock in the future.

With support and cooperation from Credit Union Student Choice--formed by several leading credit unions and CUSOs with the mission to offer innovative private student lending programs that focus on people before profits--Filene is excited to test a new program with credit unions called Debt Dragon. This innovative program aims to better inform students and their families of the debt implications they’re about to take on BEFORE the debt becomes an insurmountable burden. Debt Dragon was created by those on the front lines, working in and with credit unions, and directly with individuals suffering from too much student debt. This is the answer we need, they say.

Debt Dragon

Debt Dragon helps students and their families proactively manage education-related expenses by utilizing instant, online interactive results and implications to real-life decisions. It gives students entering college a real picture of what their debt might look like when their schooling ends. This tool is simple and stand alone--making it easy to implement and use right out of the gate. 

Your credit union can sign on to test Debt Dragon with your credit union peers across the country and bring unprecedented value to the members who desperately need this kind of financial guidance and partnership from you. We’ve extend the deadline to Friday, March 24 – so fill out this short interest form and we’ll get you geared up to be the hero your members need.

A parting thought -- what would I do?

My children will have to face debt dragons of their own someday. To help them make the best decisions possible, I plan on discussing matters of student loan debt with them while they are in high school, and before we do any college tours. The more educated my children can be on the issue, the more educated choices they will make. I would absolutely take advantage of using a Debt Dragon tool with them and my credit union.

By signing up to test Debt Dragon, you’re helping your members tame their student loan debt and keeping them from falling off the cliff of debt.