For college students, affordability shapes nearly every aspect of the college experience. It influences academic performance by determining how much time students can dedicate to their studies. It affects mental well-being by limiting our ability to participate in campus life. It even dictates the small experiences that make college memorable, including late-night Taco Bell runs and spontaneous outings with friends.
More importantly, the financial circumstances students navigate in college can shape the opportunities available to them long after graduation.
Ideally, college should be your first opportunity to learn how borrowing works, build credit and understand how changes in interest rates affect your finances. But this year’s midterm election results may be the most consequential financial development of the decade. This is because the party in charge significantly helps set the direction of interest rates and the stock market through the end of the year.
Markets thrive on predictability and predictability requires stability. While political priorities may shift, certain economic principles should transcend party lines.
Democrats don’t need to out-regulate Republicans to help students borrow. Rather, they need to protect the stable system already in place and create fixes to hidden fees and unpredictable loan rates.
Republicans generally oppose new financial regulations, but college students on both sides of the aisle have reason to be cautious, too. Every new rule comes with costs for lenders, and those costs are often passed on to consumers. For years, this has happened through higher fees, stricter loan requirements and fewer borrowing options. Those with little or no credit history often pay the highest price, putting college students at a particular disadvantage.
To illustrate, consider a 20-year-old with one credit card and no co-signer. From a lender’s perspective, this person is a risky borrower with little evidence that they can reliably repay a loan. As a result, traditional credit becomes more expensive and harder to access, pushing students toward less regulated (and often more expensive) alternatives, including high-interest credit cards, buy-now-pay-later plans and private loans.
In an economy that often overlooks people with little credit history or financial influence, college students can feel the effects quickly and disproportionately.
Democrats in control of Congress may seek stricter financial regulations and require bank executives to answer questions about the rising cost of living, signaling a tougher approach to financial oversight than under Republican leadership. But the White House and the Securities Exchange Commission (SEC) remain Republican-led, setting up a standoff. One Brookings analysis imagines that Democrats can choose one of two paths going forward.
On one hand, they can defend institutions like the Federal Reserve and the Federal Deposit Insurance Commission, even as those institutions’ leaders take positions at odds with Democratic priorities. On the other hand, Democrats can accept that the Supreme Court’s restructuring of government has turned financial regulation into an express policy lever of the White House.
The “blue wave” of the 2026 midterms has caused Democrats to assertively position control over once-GOP led bodies like the SEC. This is a welcome change for those who want change in every area, but we should remain skeptical over what good a Democrat body would truly do for finance. The best case for young people is a Democratic majority that resists rewriting the rules broadly, keeps the lending system predictable and spends its political capital on the costs students feel most.
In any case, conflict between areas of governance creates an uncomfortable uncertainty that could domino from riskier lending into higher interest rates and borrowing fees.
For young people, fluctuating credit rates are the worst possible conditions for making a living. Credit helps finance everything from a first car to a first apartment. When lenders cannot predict what the rules will look like tomorrow, they have a harder time making decisions today, especially when the broader economy appears unstable.
Democrats thinking more like Republicans is also not a long-term answer. Beyond playing the political game, Democrats need to address the specific financial challenges without overhauling the entire financial system. Cracking down on hidden fees, such as unexpected overdraft charges, monthly bank account fees and additional loan costs, would put money back in students’ pockets.
Freezing interest rates on federal student loans is another potential targeted solution. It would offer borrowers more predictable payments without requiring a sweeping regulatory overhaul, and Congress has the authority to make that change.
Just as importantly, smaller proposals may have an easier time gaining support from both parties and becoming law. Broader reforms can get stuck in political disagreements, and while lawmakers debate major changes, students continue paying the same high borrowing costs.
One small solution that actually becomes law can do more good than a sweeping proposal that never makes it past the debate stage.
Democrats staying “in the red,” in this sense, means preserving the stable, market-friendly financial system already in place rather than tearing it down to make a political point. Of course, the current system is far from perfect. It tends to work better for wealthy borrowers who have more financial security, while leaving those with less money and little room for financial setbacks behind. Students and other borrowers with limited savings are often the most vulnerable. When the protections or flexibility they rely on disappear, they are left to shoulder the costs.
Democrats in finance should take one lesson from Republicans: don’t disrupt a system the market already understands unless the benefits clearly outweigh the costs. Young people need lower borrowing costs, clearer rules and fewer surprise fees, not sweeping promises of a financial revolution.
Sometimes, the most affordable solution is simply one that allows students to borrow with confidence, knowing the rules won’t change overnight.
Copy edited by Jori Johnson
