I don't know what Ben meant by that, but I will add my two cents: There is definitely some percentage of the student-borrowing population that is making poor choices about where to pursue their education and how to finance it. Does it make sense to take out a lot of loans to go to your dream school when you could go to a state school without loans? Does it make sense to take out $100k in loans to get an degree (an undergraduate degree!) in a field that's not in high demand nor highly compensated? I would define those as frivolous loans - but of course Ben may have meant something entirely different.
A related and hugely problematic issue is the number of students who take out loans but never get their intended degree - this is particularly a problem in community colleges (at least in CA) and some for-profit schools. At least in the cases above, the loan has (presumably) at least some return on investment, although often not enough to come out even, let alone ahead. But in cases where no degree is attained, there is NO return on the funds that were borrowed.
I agree with ShayBult. That's what I mean by frivolous loans. Generally I don't think it's frivolous to get loans for a high paying, high value degree like a medical degree or engineering degree. Although they're large and expensive, your future job will allow you to pay them back comfortably over time. But going to school for a degree that is not going to get you a job that pays well enough to pay back the loan is a poor investment. It's the reason why private education loans are much more stringent. The government is just investing poorly in education especially since the "gainful employment" standard no longer applies (not that it was perfect though).
And to be clear, I'm one of those people. I took out loans to go to Northwestern University for a History and Sociology degree. I wish I had not done that and had gone to a state school that would've literally paid me to attend there. Wouldn't have had a large amount of loans and probably would've received the same education.
Yes! And these are generally bad loans in the first place. Frivolous loans are only adding to the cost of higher education.
I don't know what Ben meant by that, but I will add my two cents: There is definitely some percentage of the student-borrowing population that is making poor choices about where to pursue their education and how to finance it. Does it make sense to take out a lot of loans to go to your dream school when you could go to a state school without loans? Does it make sense to take out $100k in loans to get an degree (an undergraduate degree!) in a field that's not in high demand nor highly compensated? I would define those as frivolous loans - but of course Ben may have meant something entirely different.
A related and hugely problematic issue is the number of students who take out loans but never get their intended degree - this is particularly a problem in community colleges (at least in CA) and some for-profit schools. At least in the cases above, the loan has (presumably) at least some return on investment, although often not enough to come out even, let alone ahead. But in cases where no degree is attained, there is NO return on the funds that were borrowed.
I agree with ShayBult. That's what I mean by frivolous loans. Generally I don't think it's frivolous to get loans for a high paying, high value degree like a medical degree or engineering degree. Although they're large and expensive, your future job will allow you to pay them back comfortably over time. But going to school for a degree that is not going to get you a job that pays well enough to pay back the loan is a poor investment. It's the reason why private education loans are much more stringent. The government is just investing poorly in education especially since the "gainful employment" standard no longer applies (not that it was perfect though).
And to be clear, I'm one of those people. I took out loans to go to Northwestern University for a History and Sociology degree. I wish I had not done that and had gone to a state school that would've literally paid me to attend there. Wouldn't have had a large amount of loans and probably would've received the same education.