The following is a guest post by Erica Butler, a freelance writer from Nevada working to pay off her student loan debt.
Welcome to 2017. It is a year full of change from a new presidency down to the debt that students have taken on, thanks to student loans. You have probably heard many of the current statistics about how Americans owe something like $1.4 trillion in student loan debt. This debt is owed by a rough estimate of about 44 million borrowers. When the most recent graduates from 2015 have a whopping $28,000 or more in student loan debt. This number is concerning because it is actually up an entire six percent since last year.
But, what does this actually mean for you? When you take a look at the big picture, it can be difficult to make the numbers feel personal, so we are going to break it down a bit more for you to ensure you can better understand what the student loan debt situation looks like and what it can mean for you.
Okay, let’s go ahead and take a look below.
Overall Statistics for Student Loan Debt
We talk about the total student loan debt, which is at $1.4 trillion spread across a total of 44 million borrowers. Out of those 44 million borrowers, 70 percent of them are current college students.
There is a total default rate of about 11.3 percent and a delinquency rate of 5.41 percent. Each borrower carries a rough estimate of $27,857 in debt. Some borrowers will owe much more and some will owe much less. Remember, the estimate student loan debt per borrower from 2015 is $28,000.
Overall Statistics for Federal Student Loan Debt
These statistics below are for federal student loan debt ONLY. Remember, there is a difference between federal and private student loans. Federal loans are the most common types of loans that students receive since private student loans are harder to obtain.
The total amount of outstanding federal student loan debt is equal to $1.29 trillion with direct loans equaling about $949 billion of that. There are over 40 million borrowers who have federal student loan debt. The total number of borrowers with federal direct loans is 31 million.
Interesting and Shocking Student Loan Debt Statistics
Below, you will find some additional student loan debt statistics that are both interesting and shocking. We believe that these stats are good to know because they help to put the entire situation into perspective.
- There are more Americans that hold student loan debt than there is in population in over 200 countries
- Over 60 percent of borrowers have had to wait to purchase a vehicle due to their debt
- Student loan debt is the second highest form of debt. It is second to mortgage debt
- 90 percent of private student loans are co-signed
- Over 40 percent of borrowers wait to have a family because of their debt
- Over 70 percent of borrowers have put off saving for retirement due to their debt
- 30 percent of borrowers have waited to get married because of student loan debt
- 71 percent of borrowers have delayed the purchase of a home because of student loan debt
- Student loan debt increases by about $2,667 per second
- 37 percent of borrowers currently are paying down their debt
Students Who Incur the Most Debt
Unfortunately, student loan debt hurts certain types of students more than it does other types of students. While it may not seem fair, it is just the way things work out and it means that you need to be that much more cautious as you start to borrow student loans.
The first type of student that suffers the most is the graduate student. This is because the cost of graduate student loans is more than that of an undergraduate loan. In addition, depending on the type of graduate degree you choose, you may incur much more debt. For example, a law degree can require you to borrow up to $150,000 or more. A medical degree can cost up to $160,000 or more.
The second type of student that suffers is the student that heads off to a for-profit school. This is because the cost of classes is much higher because the school wants to make a profit. The debt here is often heftier and students cannot always keep up with the amount.
The last type of student that suffers the most is the student who drops out of college and does not complete a degree. Uncompleted degrees account for about 59 percent of student loan borrowers.
Get Your Financial Future into Perspective
The student loan debt statistics that have been provided above are shocking and they may even scare you a bit. There is a serious student loan debt problem and it does not seem to be getting better at all. If you want to secure your financial future, you need to make sure that you are careful when it comes to how much you borrow and you should always learn the most you can about your student loans before you sign the contract.