Updated: Jul 28
Student loan debt has become a pressing issue in the United States, affecting millions of students and their families. While all students who take out loans to pay for higher education are impacted, certain groups face a disproportionate burden of debt. In this blog post, we will explore which groups of students are most affected by student loan debt and why.
First, let’s take a look at the overall numbers. As of the first quarter of 2021, outstanding student loan debt in the U.S. was $1.57 trillion, spread among approximately 45 million borrowers. This makes student loan debt the second-largest consumer debt category in the country, after mortgage debt. The average borrower owes approximately $37,693 in student loans.
Now, let’s take a closer look at which groups of students are most affected by this debt. According to a report by the Center for Responsible Lending, Black and Latino students are more likely to borrow money for college than their white counterparts. Additionally, they are more likely to borrow larger amounts of money, leaving them with higher debt loads.
In 2019, the average debt for Black bachelor’s degree recipients was $34,000, compared to $28,000 for white bachelor’s degree recipients. Similarly, Latino students were more likely to have higher levels of debt, with 66% of Latino graduates borrowing for college, compared to 43% of white graduates.
Low-income students are also more likely to struggle with student loan debt. According to the Institute for College Access and Success, students from families with incomes below $30,000 were more likely to borrow money for college and more likely to default on their loans. These students are also more likely to attend for-profit colleges, which often have higher tuition costs and lower graduation rates.
Students who attend graduate school also face higher levels of debt. According to the College Board, the average debt for students who earn a master’s degree is $66,000, while the average debt for those who earn a doctorate is $102,000.
Finally, it is important to note that women are more likely to take out student loans and more likely to face challenges repaying their debt. According to a report by the American Association of University Women, women hold nearly two-thirds of all outstanding student loan debt in the United States. Additionally, women are more likely to work in low-paying fields, making it more difficult for them to repay their loans.
Student loan debt affects a wide range of students in the United States, but certain groups face a disproportionate burden of debt. Black and Latino students, low-income students, graduate students, and women are all more likely to struggle with student loan debt. Understanding these disparities is crucial for policymakers and borrowers alike as we work towards solutions to address the student loan debt crisis.