These days, a college education is considered a luxury for many American families. For the 2022-23 school year, a full-time student can expect the sticker price on a public, four-year, in-state school to be $10,950, according to the College Board’s 2022 Trends in College Pricing report . That’s $190 higher than the previous year, or an increase of 1.8% before adjusting for inflation.
For a private non-profit university, the annual cost jumps to $39,400, an increase of $1,330 over the previous year.
Multiply that by four years, add out-of-state or private school tuition, or pursue an advanced degree, and it’s easy to see why so many students and their parents have to borrow money to cover the cost of tuition and related school expenses. In fact, 43.6 million borrowers have federal student loans, which equates to 93% of all student loan debt.
You might be one of them, or have a family member or close friend who is. But how much do you really know about student debt? After all, it can rank right up there with politics and religion on the list of topics that no one wants to bring up.
Any idea which states have the highest student loan balances? Or how much Americans owe in total on their student loans? What about how common it is for people to stop making payments?
We’ve gathered those answers and more, and the numbers may surprise you. Because whether you see it as a private struggle or a national crisis, student loan debt is a big deal.
1. Americans currently owe over $1.7 trillion on their student loans.
That was the cumulative student loan balance among American consumers as of August 2023. A decade ago, that figure was closer to $1.1 trillion. Student loans are now the largest form of consumer debt in the U.S. other than mortgages — exceeding car loans and credit card debt.
Want some good news? This debt crisis has been getting some attention. Though the Biden administration was unsuccessful in implementing a nationwide student loan forgiveness program (at least for now), it has forgiven more than $116 billion in student loan debt via more targeted forgiveness initiatives. It has also made improvements to how payments toward forgiveness under income-driven repayment (IDR) and the Public Service Loan Forgiveness (PSLF) program are counted. Plus, it implemented a new, improved IDR program known as Saving on a Valuable Education (SAVE).
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2. The average student loan balance is more than $37,000.
The average federal student loan borrower today owes $37,718. .Borrowers with private loans owe even more: as high as $40,449, on average.
When divided up by generation, Baby Boomers carry the highest average balance at $45,136. Gen Xers come in second, with balances averaging $43,438. Millennials have the next-highest average balance of $33,173, followed by Gen Z with $14,315.
3. Individual debts vary widely.
The average debt is just that — the average. Recent figures show that student loan balances are as varied as age, state and program statistics. Total balances can range from less than $1,000 to more than $200,000, depending on the borrower.
This may not come as a surprise when compared to the total costs of attending college. For the 2022-23 school year, Kenyon College in Ohio topped the list of most expensive schools at $66,490 a year for tuition and fees, according to U.S. News and World Report . On the other hand, a handful of schools, including Berea College in Kentucky and College of the Ozarks in Missouri, offer free college tuition to students who qualify.
4. Current student debt varies widely by state and college.
While not technically a state, Washington, D.C. topped the list of states with the highest student debt, with an average of $54,945 — more than $12,000 higher than the next-highest state, Maryland, which averaged $42,861. The bottom of the list (or perhaps the top, depending on your point of view), includes North Dakota, South Dakota, and Iowa, all with less than $31,000.
Likewise, the program students pursue can have a huge impact on the amount of student debt facing graduates. The cost of graduate school can vary widely by program. Specialized degrees — medicine, law, or pharmacy, for example — could leave students facing even higher debt burdens, sometimes upwards of $100,000.
5. Student loan debt disproportionately impacts women and borrowers of color.
Student loan debt can have a number of devastating consequences for borrowers of all backgrounds. It’s shown to make major life milestones such as buying a home and starting a family less attainable. And for those who can’t afford their payments, student loan default can wreak havoc on their credit and overall finances.
However, certain borrowers are disproportionately burdened by student loan debt. For instance, Black college graduates owe an average of $25,000 more in student loan debt than white college graduates. And four years after graduation, Black students owe an average of 188% more than what white students borrowed.
Additionally, Hispanic and Latino borrowers were the most likely to delay getting married and having children due to student loan debt.
Further, 64% of student loan debt is held by women, with the highest average amount of debt belonging to Black women.
6. Americans with student debt are likely to have multiple loans.
The Department of Education currently contracts a few different loan servicers . The federal student loan will be assigned to a loan servicer when it is disbursed. For borrowers with multiple student loans, it is possible that they’d have multiple loan servicers. That could be a lot to juggle, and one reason borrowers may consider federal student loan consolidation.
7. The number of borrowers defaulting on their student loans is in the seven figures.
As of 2023, one out of every 10 Americans has defaulted on a student loan, and 5% of all student loan debt is currently in default. About 4 million student loans enter default each year.
Risk factors for student loan default can include having other forms of debt, such as a credit card balance, car payment, or mortgage. And defaulting on loans can also put borrowers at risk for having other bills, such as medical expenses, end up in collections as well.
What’s to be done? Even if you just stop paying on your student loans, they won’t go away (though the new SAVE Plan can bring your payment down to $0 if your income is low enough, and may eventually lead to forgiveness if your income remains low.) And in the meantime, interest will continue to accrue and, in some cases, capitalize (along with penalties and other downsides to nonpayment, like being sent to collections).
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
SoFi Student Loan Refinance
If you are a federal student loan borrower, you should consider all of your repayment opportunities including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. Please note that once you refinance federal student loans you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans or extended repayment plans.
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