Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Feb 8, 2021

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Student loan debt is so high because college prices continue to soar higher and quicker than the rate of inflation. In other words, colleges are becoming more expensive when compared to the value of the dollar. Consequently, our purchasing power is not keeping up with the cost of our colleges.

Take for instance California’s public colleges. California is known for its higher education and it boasts three types of public institutions: The University of California (UC) colleges, California State colleges, and California Community Colleges.

According to a recent study by, the combined average price at California’s three types of public colleges rose by an astounding 1,373 percent between 1981 and 2011.

To put that figure in perspective, let’s look at everybody’s favorite inflation metaphor: gasoline. In the 1980s a gallon of gas could be found for $1.25. If the price of gas followed the same price trajectory as California colleges, then in 2011 we’d be paying $17.16 for each gallon of gas.

However, that price trajectory becomes even more tragic when we look at the rate of inflation over the same time period: between 1981 and 2011, the value of the dollar only rose by 147 percent.

So while a single dollar in 2011 was worth about 2.5 times the value of a single dollar in 1981, the cost of college now averages more than 13 times the amount it was 30 years ago. For some college’s, it’s far more than that.

One year at a Cal State in 1981 cost $319, but in 2011 one year cost $6,422. Those who need to get student loans today will pay far more money for arguably the same education offered years ago. If one then looks at interest rates and fees paid on these enormous sums, it’s not hard to see exactly how student loan debt has spiraled out of control.

Topping $1 trillion today, student loan debt now surpasses the entire nation’s outstanding credit card debt. Given these statistics, how much will college cost—and subsequently what will out national student loan debt be like—in 30 more years?