ASU students react to Obama's loan reduction plan

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By Jennifer Thomas By Jennifer Thomas

TEMPE, Ariz. -- The college experience is often described as priceless, but try explaining that to students like Laurie Evans.

"I just started getting student loans at the beginning of this year and I'm already at $15,000! I'll have a total of $20,000 when I'm done with ASU," Evans said.

Evans is also a transfer student with only a year and a half left, so other students could likely multiply that total by two years or more, when you factor in graduate school. Is President Obama's plan going to help when they get their degree?

"Student debt is now higher than credit card debt. We've got a real problem so this could be part of the solution," said financial planner Cynthia Fick.

She says President Obama's plan to lower monthly payments by capping loan repayment at 10 percent of discretionary income can only help.

"The reality of the amount of debt, unless they're independently wealthy, for them to graduate it's going to take years of their lives to pay that back," Fick said. "So anything to help reduce that will be positive."

Evans agrees that the benefits go beyond just more money in students' wallets.

"I think it's important to encourage young people to go to school, and a program like that sounds like it may be an initiative for more people to go to school," she said.

The president said with lower payments, grads would have more money to spend on a car, a home or starting a family, and through that they'll stimulate the economy. Critics of the plan say Obama's timing is purely political and he's trying to earn favor with the young voting base he had in 2008.