Growing calls for ways to deal with college loan debt can lead to a statistical question: just how much does “the average” college student owe? Here are some of the figures:
Meet Kelli Space. She went to Northeastern University to get a degree in sociology. And she graduated in $200,000 of student loan debt. In the economy’s newest trillion-dollar crisis, she is the 1 percent.
Kelli is not the face of America’s student debt problem. Among the 37 million people in this country with student loans to pay off, the median balance is $12,800. A whole 72 percent of borrowers have less than $25,000 left in debt, according to data from the Federal Reserve Bank of New York.
No, students like Kelli are the rarities, the white rhinos. Only about 5 percent of borrowers owe more than $75,000.
The key figures for me: the median is $12,800, meaning that half of people with student loans have less than this figure, half have more. Yet, nearly three-quarters of those with loans have less than $25,000 to pay off. Only 11% have more than $50k in debt.
So why do we keep hearing stories about those who owe mega amounts of money? Perhaps we might think of them as canaries in the mine shaft, students who show how bad the college finance system might be today. But, on the other hand, the statistics suggest that these students are rarities, people who have unusual debt. From these anecdotal and relatively rare stories, it seems like there is a pattern: a student goes to a prestigious school banking on the name of the school to pay off. (One common argument you will find online is that the major should be blamed – this usually puts more creative disciplines, the humanities, and subjects like sociology at the center of blame.) But, the name doesn’t always pay off, the student can’t find a good enough job to start paying off these debts, and the interest just continues to grow.
Overall, we need to work with the statistics more than the anecdotes: most college students do not have more than $25,000 of debt. This is not a small amount but it can be tackled (though the economy doesn’t help).