November 27, 2017

Average Student Loan Debt Will Scare You

Read more about Student Loans

On average, college graduates leave college with over $37,000 in student loan debt. Some leave with as much as $121,000 in debt. Many graduates remain in debt until they are well into their 40s.

Did you know: The total amount of student loan debt in the United States as of 2017 is $1.4 trillion. This amount of debt is only second to mortgage debt and is significantly more than the total credit card debt. In the first quarter of 2017 borrowing for federal loans was at $136.3 billion which is down 3% from 2016.

Read this shocking guide to learn the truth about student loans.

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The Student Loan Crisis

  • What is the average student loan debt in America?
    Today's graduates leave college with an average debt of $37,172, according to Mark Kantrowitz. This is a 6% increase over the previous year and is indicative of the student loan crisis the U.S. faces.

  • How many student borrowers have federal student loans?
    Currently the total amount of Federal student borrowers is at 42.3 million borrowers. Borrowing for student loans has steadily decreased since 2012, but there are still over 7 million new student borrowers each year. This means that the outstanding student loan balance will continue to rise and along with the amounts students will owe.

  • What is the average amount of student loan debt for a Bachelor's degree?
    Graduates with a Bachelor's degree leave college with around $35,000 in debt. This is the high-end average. Some students are lucky enough to get away with just $4,600 in debt. There are others who have as much as $59,000 in debt, though.

    The student loan debt crisis is especially crippling to the Millennial generation. Half of all student loan borrowers are under 25 and when you take into consideration the amount of debt the group with the most excessive student loan debt it is the Millennial generation.

  • What is the average amount of student loan debt for a PhD?
    Psychology, education, and social science students graduating with a PhD had the highest level of student debt among fellow doctorate graduates. They have an average of $30,000 just in graduate debt. Students in mathematics and computer science generally leave school with no debt related to their PhD.

  • What is the average amount of student loan debt for a Master's?
    40% of federal student loans go to graduate students. The average Master's degree graduate has $59,000 in student debt.

  • What is the average amount of student loan debt for lawyers?
    Being a lawyer seems like a big, cushy job, but it comes at an expense. The average law student graduates with $84,000 in debt from a public college. Those who prefer a private college have a whopping $121,000 in debt.

  • What is the average amount of student loan debt for doctors?
    35% of medical students have more than $200,000 in debt when they leave school. 21% have between $150,000 and $200,000 and 31% have less than $150,000. Unfortunately, only 5% of medical school graduates are aware of their options for loan repayment.

  • What is the average amount of student loan debt for teachers?
    Teachers with a Master's degree have an average of $50,000 in student loan debt. There are several loan forgiveness programs for teachers. However, the options are so overwhelming that many teachers avoid it.

  • What is the average amount of student loan debt for nurses?
    Nurses graduate college with an average of $40,000 to $55,000 in student loan debt. Even though many nurses make an average of $72,000, it can still take very long to pay off the student loan debt.

    Tip: If you have questions or concerns about your student loans you can visit Federal StudentAid while there you can also use the repayment estimator to get an idea of how much you will need to pay each month.

  • How many students are in debt?
    70% of students who graduated college have some type of student loan debt. Student loan debt is quickly becoming one of the most expensive debts in the United States.

  • What is the average student loan monthly payment?
    Graduates pay an average of $351 per month for student loans. 25% of students have an average payment of between $203 and $400, which pulls the average up. 50% of graduates have a payment less than $203 per month.

  • How many student loan borrowers are in their 40s?
    There are 6.8 million student loan borrowers aged 40 and older. In fact, today, 60% of student loan borrowers don't expect to be any younger than 40 years old before paying off student loans.

  • What is the average student loan balance of graduates in their 40s?
    Shockingly, borrowers in their 40s still have an average balance of $33,765.

Paying Off Student Loans

  • What is the average time to pay off student loans?
    The Standard Student Repayment Plan has student loans paid off in 10 years. Unfortunately, 20 years is more common today.

    Did you know: If you are not able to make the standard repayment the Federal Government provides you with 4 different income driven repayment plans?

    These options can help lower your monthly payments and extend the life of your loan to make repayment manageable. Remember though the longer you repay the more time interest will have to accrue.

  • What is the minimum monthly payment on the Standard Repayment Plan?
    Your monthly payment will not be less than $50 on the Standard Repayment Plan. Payments are made for 10 years at the most.

    Tip: If you are not able to make payments on your federal student loans you can apply for a forbearance or a deferment. A forbearance is valid for up to 12 months at a time and will help with any type of financial difficulties. A deferment is valid for up to six months at a time and will help with job loss, returning to school and financial issues. You have three years of time for both options.

  • What if I don't make my monthly payment?
    If you fail to make monthly payments on your loans for 270 days your loans will enter default with the federal government. After 360 days your loans will enter collections with the federal government. At this time the federal government may elect to seize your taxes or garnish your wages to collect this past due amount. Also, your credit score may suffer dropping up to 200 points.

  • What is the average interest rate on federal student loans?
    Undergraduates with unsubsidized federal student loans pay an average interest rate of 4.45% on their loans. That's 0.69 points higher than last year's rate for new borrowers.

  • What is the average interest rate on private student loans?
    Private student loans cost borrowers 3.3 - 5.2 points more than federal loans. The average variable rate is 7.81% and the average fixed rate is 9.66%.

    Variable and Fixed Interest Rates: Remember that Direct Subsidized, Unsubsidized loans for undergraduates and graduates and PLUS loans for parents are fixed interest rates. They vary for each year that you receive the loans, but once granted they remain fixed. Many private student loans have variable rates. Make sure that you know which one your loans fall under.

  • How many students need private student loans?
    The rising cost of tuition has caused many borrowers to turn to private student loans. As many as 1.4 million students now use private student loans. They often do so to make up the difference in what federal loans would not cover.

College Costs

Tip: As you prepare for your undergraduate/graduate career after completing FAFSA, you will get an idea of the type of aid you are eligible for. Once you know this you can then figure out how that will cover the time in the program. This way going in you know roughly how much debt you will incur. You can start to consider options for repayment and other ways to cover school related expenses.

  • What is the average cost of an in-state public college?
    Staying in state can help you keep costs down. However, it still costs an average of $24,610 to go to college in state.

  • What is the average cost of tuition at an in-state public college?
    Tuition at a public 4-year, in-state college costs an average of $9,970. If you are thinking of heading out of state for a public college, expect to pay almost 3 times as much for tuition.

  • What is the average cost of room and board at an in-state public college?
    Room and board at an in-state college costs more than tuition. Expect to spend at least $10,800 on room and board.

  • What is the average cost of a private college?
    Private colleges are known for their higher cost. Today, expect to pay an average of $49,320 for private college life.

  • What is the average cost of tuition at a private college?
    Private colleges charge an average of $34,740 for tuition alone.

  • What is the average cost of room and board at a private college?
    At $12,210, room and board at a private college is around $2,000 more than an in-state public college. This is a 3% increase over last year's average room and board.

The Bottom Line

Student loans can be a blessing and a curse. Before you take one on, consider your options. Look at the long-term implications. If you already have student loans, explore your repayment options. You may even be eligible for loan forgiveness. Knowing your options can help you get out of student loan debt faster.

More from CreditDonkey:

Pay Off Student Loans Fast

Student Loan Forgiveness

Average Student Loan Payment

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Paying Off Student Loans Early

Paying off those student loans will have a positive impact on your future. So how can you do it sooner? Read on for payment plans and other tips you can't afford to miss.

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