McRae: Avoid Student Loans

Note: The following column is presented the Mississippi State Treasurer David McRae.

By Treasurer David McRae

$1.8 trillion – that’s how much student loan debt is held by Americans today. It’s an amount that has tripled in the last decade and a half alone – and to be frank, I don’t think we’ve seen the peak of this growth.

This incredible amount of debt has become a major point of political tension in recent years, especially after the Biden administration proposed a $426 billion bailout that taxpayers bristled at and the Supreme Court ultimately ruled as unconstitutional.

The truth is there is no quick forgiveness fix for this problem, and those incurring student loan debt today should not expect it to be paid off by someone else. For future college goers, however, there are responsible ways to reduce – and even altogether avoid – student loan debt. How? The Mississippi Prepaid Affordable College Tuition Plan (MPACT), offered through my office, the State Treasury.

MPACT is an almost-too-good-to-be-true program that allows families to lock in today’s tuition rates and start on a payment plan that will have your child or grandchild’s tuition paid off by the time they receive their diploma.

We have just opened MPACT for the 2023-24 enrollment season. You have from now through May 31, 2024, to lock in your rates and begin pre-paying for a loved one’s college tuition. As an added bonus, many of the investments Mississippi families choose to make come with some tax advantages as well.

I would encourage you to reach out to my team for more information as soon as possible, as there are several variables that will affect the monthly cost of your plan, including your down payment, your child’s age, and how many credit hours you’d like to pre-pay.

There is no question that a college degree isn’t right for everyone, but it does continue to offer upward mobility for many. According to the U.S. Bureau of Labor Statistics’ most recent quarterly report (Q2 2023), workers with a bachelor’s degree earn about 1.5 times more than their counterpart with a high school diploma, $1,588/week versus $889/week. For that reason, many families see a long-term financial benefit in investing in child’s degree. But growing student loan debt can put a serious dent in that additional income, making programs like MPACT essential.

I encourage you to consider MPACT as an option for your family. To learn more about the program, please visit Treasury.MS.gov/MPACT. If you have specific questions, please call us at (601) 359-5255 or email our team at CollegeSavings@treasury.ms.gov.

And finally, to all our teachers and students, welcome back to school! I wish you a year filled with curiosity, discovery, and excitement.

Mississippi Treasurer David McRae is the 55th Treasurer for the State of Mississippi. In this role, he helps manage the state’s cash flow, oversees College Savings Mississippi, and has returned nearly $75 million in unclaimed money to Mississippians. For more information, visit Treasury.MS.gov.