Why we're mortgaging our futures

Trent over at The Simple Dollar recently answered this question:

I’m amazed at how many people who write into your mailbags have enormous student loan debts and mortgages. I know that prices have increased, but whatever happened to just working at your job and using that money to pay for school and for your down payment?

His response? Today's young adults don't have much of a choice:

In other words, for every dollar increase in the minimum wage since 1970, the price of an average item has gone up $1.36. Even adjusting for inflation, a dollar today buys less than it once did for low income earners.

In 1970, a year of tuition at a public university cost $1,207. In the most recent year of data available, 2007, a year of tuition at a public university cost $11,034. That represents an annual average increase of 6.2%, which, if you applied it to the 2007 price, gives you an estimated 2010 cost of a year of education as being $13,216. That’s a 994% increase in the cost of a four year degree.

It is almost impossible to work enough to pay for school at the same time:

In 1970, you could work 755 hours at a minimum wage job over the course of a year to earn enough to pay for a year of schooling at a public institution – about 14 hours per week.
In 2010, you would have to work 1,823 hours at a minimum wage job over the course of a year to earn enough money to pay for a year of schooling at a public institution – about 35 hours per week.

With this incredible inflation, is an education really worth the cost? Considering the need for a degree in today's job market, I'd say yes. But maybe I'm just trying to make myself feel better about my incredible debt. As Trent wrote:

In other words, in 1970, the choice to enter the workforce immediately after high school or work a minimum wage job while going to college was a real choice. Today, it’s not a real choice unless you want to agree to low income for life. You have to enter the costly bargain of secondary education.

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