Politicians, economists and consumer advocacy groups bemoaned the extremely high rising costs of healthcare until their outrage reached such a high pitch that Congress passed the Affordable Care Act. This legislation was “sold” with the idea that a centralized, controlled and monitored healthcare would lower costs.
It might be too early to pass final judgment on the cost-controlling features of the Affordable Care Act, BUT there is another industry with costs skyrocketing beyond healthcare expenses, which until now, seems to have remained just below the radar: higher education.
The New York Times recently reported that “66+ percent of students who earn a bachelor’s degree borrow to pay for higher education—up from 45 percent in 1993…This includes loans from the federal government, private lenders and relatives. For all borrowers, the average debt in 2011 was $23,300, with 10 percent owing more than $54,000 and 3 percent more than $100,000.”
The Times continued: “The cost of tuition and fees has continued to increase faster than the rate of inflation, faster even than medical spending. If the trends continue through 2016, the average cost of a public college will have more than doubled in just 15 years according to the Department of Education.”
Personally, I am a huge proponent of higher education. In fact, I believe education is one of the main keys to solving poverty and other challenges facing our country and world. Economists state that in the long run it is still better to graduate from college with debt instead of not graduating from college.
Many financial experts consider student loans to be a “good debt.” But at what point does the debt that potentially sinks our college graduates and dropouts do more detriment to our economy than not obtaining an education?
This is not a simple problem that can be resolved quickly or even magically with new legislation. It will require state governments, colleges, financial and even the ARM industry to work together to find a workable solution. College costs need to be reined in and our students need to have the ability to pay back these outrageous loans.
How can the ARM industry assist those facing such massive loans, just after graduation and even 10 or 15 years down the line? We can help graduates figure out how best to handle their payments and successfully pay the loan(s) off in a timely, but realistic manner.
A few suggestions for doing this:
- Assign agents to be “student loan specialists.” If you aren’t exclusively concentrating on student loan debt (or have different types of loans you’re dealing with), specializing can give the agents an edge in knowing how to approach the person. There are dialing technology features that allow you to pre-assign and schedule lists for whole groups of agents. Plus, call routing features available make sure inbound calls are sent to the right group of agents. Ask your dialer vendor about the possibilities.
- Treat them with respect. Not that you shouldn’t do this anyway, but it’s a different kind of debt, and a different circumstance than someone buying a pair of shoes and then not paying for it. The person probably thinks of it that way, too, and might be much more cooperative if we acknowledge the difference.
- Keep reminder calls friendly, but persistent with IVR Messaging.
- Give them a lot of payment options, especially online options. Younger graduates are much more likely to go online than call or mail something in.
- Try feinting. Read this blog post for ideas on “mixing-up” contacting strategies.
- Show them how paying their debt will be beneficial for their credit score. Without decent credit, they won’t be able to buy the house/car/boat they dreamed about in college.
The ARM Industry is in a great position to help manage and resolve the current student loan tragedy. We have the people, tools, experience and ingenuity to help guide our debt laden college graduates back to solid financial ground.