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Scary, but true. The amount of student debt in the United States is approximately $1.5 trillion , about one-and-a-half times what Americans currently owe on their credit cards. People use credit cards for home repairs, to go on vacation, to buy groceries, to eat out at restaurants—and for just about any other expense you can think of. Yet, all of these purchases combined are dwarfed by our country’s total student loan debt.

Student loan debt is now the second biggest form of debt in our country, only behind mortgage loans—and the debt balance and its accompanying crisis continues to grow. In this post, we’ll delve into what impact this situation is having on the millennial generation (and other borrowers). We’ll also reverse engineer the reasons why this debt crisis is taking place and share strategies to help whittle down student loan debt, maybe even paying it off more quickly.

National Student Loan Debt and Its Impact on Borrowers

A recent study shows that millennials who have student debt have a net worth, on average, that’s 75% less than those without student debt (an average of $29,087, compared to $114,376 for those who are loan-free).

Students with loan debt also tend to have, when compared to their peers with no student loan debt:

•  about half as much money in the bank ($5,500 versus $10,180 )

•  approximately $19,000 less in their retirement accounts ($21,160 versus $39,905 )

•  larger mortgages—and on homes with less value

In short, financial wellness of millennials with student loan debt is clearly substandard, overall, when compared to others in their demographic without this debt. And, although people with college degrees tend to get higher-paying jobs, overall, the weight of the student debt that often accompanies it can drag down a person’s ability to gain financial wellness.

Here’s another statistic to consider: in an era when total student loan debt has surpassed total credit card debt, millennials with student loans also have more credit card debt.

•  55% of those with student loans also have credit card debt ; only 32% without education-related debt do.

•  Their average balance is $2,888 compared to $1,476 for graduates without student loan debt.

A Forbes article looks at the “disastrous domino effect” created by student debt, with one couple sharing how their debt is forcing them to “put their lives on hold year after year.” It’s had a negative impact on their marriage as they focus on paying down debt, and as they’re waiting to have children and buy a home. This debt has been a “huge burden and point of contention.”

Related: Will There Ever Be a Student Loan Bailout?

The borrower being quoted was a participant in a 50-state survey, Buried in Debt , of student loan debt and its impact on borrowers.

This report examines how the unrelenting stress of student debt can strain borrowers financially as well as emotionally. One of the participants shares how she regularly thinks about selling everything she owns to live in her car so she can put more money towards her debt.

Conclusions from the report include:

•  Nearly 90% of borrowers surveyed struggle to make payments.

•  The majority have less than $1,000 in their bank account.

•  6% of them have even had Social Security payments or wages garnished.

•  Nearly one third of them say their student loan bill is higher than their rent or mortgage payment.

•  65% say it’s higher than their entire monthly food budget.

More About the National Student Loan Debt Crisis

The amount of U.S. student loan debt continues to grow, increasing by 170% in just 10 years’ time . You read that right: over the last 10 years or so, the amount of student debt (in real dollars!) nearly tripled, which may lead people to believe we’re in the midst of a student loan bubble, similar to the subprime real estate bubble from a decade ago.

In June 2018, NASDAQ.com published Safehaven’s prediction that the student loan bubble is about to pop, and the article also shares how, earlier in 2018, the chairman of the Federal Reserve stated that this student loan increase could “slow down economic growth.”

Why this Debt is Growing

In part, the total student loan debt is growing because the costs of getting an education are still rising beyond the rate of inflation. In fact, over the last 10 years, the published costs of in-state tuition and fees at public universities increased at an average of 3.1% beyond the rate of inflation.

And, as long as the cost of attending college outpaces the cost of living, problems will continue for borrowers. Plus, the housing market crash of 2008 has also fed into today’s student loan debt crisis. That’s because some parents who’d planned to borrow against their homes’ equity to help their children attend college often couldn’t do so, post-2008. So, these students needed to take on debt of their own. More specifically, some economists suggest that, for every $1 drop in home equity loans, there has been an increase of 40 to 60 cents in student loans.

Even more alarming, analysis by The Brookings Institution estimates that, by 2023 (just a few short years away!), nearly 40% of student borrowers may default on their loans.

Paying Down Student Debt More Quickly

If possible, you could consider making an extra payment annually toward your loans’ principal balance. Can you do this twice a year? Every quarter? Paying extra toward your loans can help you get them paid off more quickly.

If that strategy is too much for your cash flow situation, you could always try figuring out how much you could increase your monthly payment beyond the minimum. Even if that doesn’t seem like an option right now, you can continue monitoring your financial situation and taking advantage of when you can pay more to your debt balance.

It can also help to create or review your monthly budget to see where you can cut back on expenses. For example:

•  How many paid apps, monthly subscriptions, and so forth do you have automatically deducted from a bank account or put on a credit card? Do you use them enough to justify their prices? There are even apps that help you can cancel unnecessary subscriptions and more.

•  When is the last time you shopped around to make sure you’re getting a good deal on your car insurance, enter’s insurance, or cell phone plan? How much could you save if you switched to a less expensive plan, and would the coverage still be as good?

•  What discretionary spending can you reasonably live without?

What would happen if you put those “found” dollars onto your student loan balance?

Refinancing Student Loan Debt with SoFi

If you’ve ever consolidated, say, balances from multiple credit cards into a personal loan, then you already know how much more convenient it can be to have one monthly payment. And, if you can get a lower rate on your new loan, you could also pay less interest over the life of the loan—depending on your repayment term.

The same is true when you refinance your student loans. It isn’t unusual for students to have taken out multiple loans for their education, and consolidating them into one loan with one monthly payment and a potentially lower interest rate might help them manage their repayment.

At SoFi, we allow you to refinance federal and private loans. We do, however, recommend that you explore the repayment benefits you can receive with federal loans, such as forgiveness programs or income-driven repayment plans, before refinancing. You’ll lose out on those benefits when you refinance with a private lender, so it’s important to be sure you won’t want to take advantage of any federal loan benefits either now or in the future.

When you refinance, you can opt for a fixed or variable loan and potentially select a more favorable loan term. If you are currently struggling to make your monthly student loan payments, it might make more sense to choose a longer term—though this can mean paying more interest over the life of the loan. Alternately, if you refinance to a shorter term, you could pay your loans off earlier, potentially paying less in interest.

In just two minutes, you can find your rate online and see if you qualify for SoFi student loan refinancing.

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