How You Can Use Degree Insurance, to Make Guaranteed Income?
Next Generation College Funding
For more than a decade, High School students, have taken thousands and hundreds of thousand dollars in college loans to invest into their futures, in hopes to land a sustainable career. Many Americans have failed. It is reported that in 2018, more than half of the country’s college students earned $28,000 per year, after getting a college degree.
It started to become clear to many future college students and families, that investing money, you don’t have in hopes to get a degree and make more, was more of a scam, then a promise. With over 44 Million individuals making up more than $1.5 Trillion in college debt, it’s easy to feel scanned.
The truth is with any investment you make, their is always risk. Nothing is ever guaranteed. There are ways to research, and actions individuals can do, to mitigate those risk, but it’s never fully be up to you.
Colleges and universities across America are starting to become understanding of these investment risks that millions of Americans make every year. In an effort to help decrease the risk, (4) states, including: Utah, Mississippi, Illinois and Idaho, colleges teamed up with Degree Insurance to provide students an income guarantee for their career.
How It Works:
- It is completely FREE for college students.
- They partner with colleges and universities across the United States.
- Colleges & Universities pay a fee for their students to go to their college. The insurance applies to all degrees offered at the college automatically.
- Students are then promised with a specific major to make X amount of income once graduated.
- After a student graduates, they have five years to make the income requirement.
- If they never meet the income requirement for their major, the insurance provides the difference.
Colleges With American Dream Insurance
Currently, Degree Insurance is working with colleges and universities to make their startup available to colleges all across the United States. Working closely with state and federal regulators to authorize the insurance model. As of right now, only Illinois, is coherent with the new insurance.
They are hoping that with this model, the federal government, could but funding towards the insurance model, to even allow for every American the opportunity for a secured financial future.
What Does Guaranteed Income Look Like?
Depending on the college or university you attend, when you study, the statistical data analysis they formulate, and your major, they will formulate an income threshold you will make by the time you graduate. For example, if you majored in Business it might be $41,000/year, although if you major in engineering it might be $51,000/year. There is multiple factors that determine your guarantee income threshold.
How Would They Guarantee I Never Made Guarantee Threshold?
On their website, they suggest every year in your coverage, you will be required to upload your tax returns. If after fifth year, they notice you never made the guarantee threshold number, they will send your claim for the difference.
If you decided to attend graduate school after or anytime in that five year period, it does not void the policy. In that period of time, your policy would enter a grace period, and will be frozen until you graduate. Then it will continue for the years left in the policy.
In order to get the claim, you are required to seek employment in the time frame of the policy. The requirement of time or how it would be docked is dependent on state, federal, or the colleges individual requirements.
What Are The Downfalls?
American Dream Insurance policy is only great, if you are an American, or will have a visa that permits you to be in the country for the duration of the policy. If you have no intentions of seeking employment in an international country, since their income guarantee is based in the states. As well as, if you aren’t planning on working with an employer that pays more than 1% in equity, like startup companies.
My Take
As ambitious it is to desire a free college education, the chances of them occurring are slim to none. It would economically ruin a whole industry that brings so much revenue and tax aid to us yearly. The American Dream Insurance Program would provide families with the comfort to know they will make x amount of income from their degree. It will give families a chance to pay off student loans, and possibly reconsider the amount of debt taken out.
In addition, I believe it will help market colleges and universities in a way that makes them believe in their education. They would want to make their education better to meet guaranteed income for fields, so it won’t show in future reports.
Education will always be important to have in majority of careers in the future. This product is simply insuring a high risk, high cost many families endure.
