The Difference Debt Makes: College Students and Grads on How Student Debt Affects Their Life Choices

Indeed, in the study we report upon below, almost half (47%) of undergraduate students told us people should delay having children and almost a quarter (23%) thought they should delay getting married if they have student loan debt to https://getbadcreditloan.com/payday-loans-nj/denville/ repay

Recent discussions have focused on loan forgiveness as a remedy for growing student loan debt in the United States. How have their loans affected or not affected students’ lives?

College costs are rising, and declining state government investments in higher education mean that the burden of those high costs has increasingly fallen on the shoulders of individuals. In 1980, individuals paid roughly 30% of the cost of higher education, with states or the federal government covering 70%, but by 2010 government covered just half the cost, leaving 50% of costs to students and their families. While the Federal Pell grant program (targeted to low-income students) was greatly expanded during the Great Recession, allowing more students to draw upon those funds, it was not enough to make up for state budget cuts in direct higher education funding. These cuts caused tuition rates to grow over the past several ily incomes. Meanwhile, government aid has increasingly shifted from outright grants to loans. In the early 1970s a majority of government funding came in the form of grants, while in recent years the majority is in loans that must be repaid, and cannot even be discharged through bankruptcy.

Thus, over the past few decades more students have owed more money to the government or private lenders after graduating from college. In 1990, 4-year college graduates of public universities owed an average of $8,200 (or just over $16,000 in 2020 dollars.) By 2000 the load of graduating seniors had nearly doubled to $15,100 (around $22,700 in 2020 dollars), and by 2020 it had doubled again to just over $30,000! The number of students at 4-year public colleges taking out loans to finance their degrees has also grown, from fewer than half (46%) of 1993 graduates, to about two-thirds (66%) of 2016 graduates. These loans are particularly hard to pay off for students and graduates with lower family wealth, especially affecting Black borrowers.

Meanwhile, student debt increasingly serves as a strong disincentive for marriage and childbearing, and although in general, college-educated individuals are more likely to ericans, many hesitate to do so if they or their prospective partners still have college loans to pay off.

What do young adults say they would do if their loans were forgiven?

In a study published in Sociological Inquiry, Social Norms and Expectations about Student Loans and Family Formation, we report findings from a survey we conducted in 2017, and in new findings calculated especially for this CCF briefing paper, we report on a follow-up survey we conducted in 2020.

We first surveyed 2,990 undergraduate students including 1,988 (66.5%) with student loans at two regional public universities in the U.S., one in the Northeast and one in the Southeast, in early 2017. Of the 671 who reported they were about to graduate, 504 agreed to take a follow-up survey and provided an email address. Three and a half years after graduation, in , many of those email addresses no longer worked, but we were able to contact 194 (almost 40%) of those respondents, 142 of whom had taken out loans. Statistical tests indicated that these students were not significantly different from the original group of graduating seniors in terms of percent reporting student loans or average amount of loans in the first survey, racial distribution, or gender.