4 people hold up signs indicating the percentage of loan debt for each age group. 34% 18-29 year olds. 22% 30-44 year olds. 7% 45-49 year olds. 1% 60 plus year olds.

Student Loan Debt Today

Jul 14, 2020
Empower Insights

A look at the numbers behind one of the most pressing issues many Americans face

Student debt has made lots of headlines recently due to its astronomical growth: Student loan debt in the U.S. now totals $1.5 trillion.1 To put that number in perspective, $1.5 trillion is enough money to cover the costs of 24 million American households for a whole year.2

Who’s carrying debt:3

  • 34% of those 18-29
  • 22% of those 30-44
  • 7% of those 45-59
  • 1% of those age 60 and over

The amount of debt a person has tends to correlate with how advanced their highest degree is. Median debt for those with:3

  • Less than a bachelor’s degree: $10,000  
  • Bachelor’s degree: $25,000
  • Advanced degree (e.g., MA, PhD or MD): $45,000

How Americans are handling their debt:

  • 7.65 million borrowers are on an income-based or income-driven repayment plan.4
  • College graduates age 25-39 with student loans are twice as likely to report struggling financially as graduates without loans.5
  • Over one-third of borrowers who fail to earn a degree will go into default on their student loans.6
The amount of student loan debt a person has tends to correlate with how advanced their highest degree is

How to avoid defaulting

If you’re struggling with your loan payments or looking for ways to make repayment easier, you have options.

  • The government offers several income-driven repayment plans designed to help low-income borrowers avoid defaulting on their loans.
  • You may also benefit from consolidating your loans. This process combines multiple monthly bills into one, potentially making it easier to stay on top of repayments. Note that consolidating can result in losing any credit you’ve earned toward forgiveness programs like Public Service Loan Forgiveness.
  • If you feel your interest rate is simply too high, you can also try refinancing your loans through a private bank. If you do so, note that you’ll lose the protections that come with federal loans.

Invest wisely with an Empower Investment Account

1 Brookings, Yilla, Kadija and Wessel, David, “Five facts about student loans,” November 2019.

2 U.S. Census Bureau, Guzman, Gloria, “Household Income: 2018,” September 2019.

3 Pew Research Center, Cilluffo, Anthony, “Five Facts about Student Loans,” August 2019.

4 U.S. Department of Education, “Federal Student Loan Portfolio,” December 2019.

5 Pew Research Center, Cilluffo, Anthony, “Five Facts about Student Loans,” August 2019.  

6 Federal Reserve Bank of New York, “Who Is More Likely to Default on Student Loans?” November 2017.

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