What Percentage Of Students Are In Debt After College 

Student debts are the loans that students take to get a college education and other education. These debts carry many benefits, including going to school and not having to worry about paying them off. Now, What Percentage Of Students Are In Debt After College 

What Percentage Of Students Are In Debt After College 

What Percentage Of Students Take Student Loans?

 An average of 55% of students take out student loans for study. In addition, about 14% of parents and guardians with students in college take an average of $37,200 of federal parent PLUS loans, according to the 2019 survey. With the uncertainty surrounding the economy, more student debt burden is expected to land on the shoulders of citizens. 

Today, the average college student who graduates from a four-year university with a bachelor’s degree owes $26,600 in federal or private debt. Additionally, 28% of students graduate from a four-year school with more than $30,000 in debt. These students graduated from private universities at an even higher rate of 49%. With the rising cost of education and stagnant wages, many can’t afford to take on the burden of their study loans. Of course, this also contributes to why only 20% report being happy going into repayment, and just 10% will recommend their alma mater to others as a great school for learning. 

Statistics show that over $1.75 trillion has been accrued in student loans. That totals almost $440 billion more than the total federal auto loan debt.

Why Do Students Take on Debts?

Most well and high-paying jobs require the highest qualifications. Typically, an employee with a bachelor’s degree will earn more than that with a diploma, while those with masters, doctorates, and PhDs earn the highest amounts. The education requirement thus leads to many students taking up student loans to cater to their further studies. 

However, a college degree might not guarantee a higher income depending on the course one is undertaking. In addition, the high cost of college/university fees has also led to declining returns on investing in college degrees.

Why Does The Federal Government Offer Student Loans?

Higher education is one of the best forms of investing in the future. A learned population is a wealthy population. However, the cost of a college education has steadily risen in recent years, and there is a need to cushion students to enable them to achieve their dreams. The federal government offers students and parents various forms of loans to aid them in their education. The loans may come in the form of student loans, parents plus loans, research grants, and tuition grants. 

When Did The Federal Government Start Student Loan Initiative?

Financial aid by the federal government started in the aftermath of World War II in 1944. The initiatives started by the government cushioned citizens against huge financial problems by offering low-rate loans for education, homes, and businesses.

However, student funding began in 1957 by an act of legislation by congress that established federally funded student loan programs, albeit for science and related research studies. The program was expanded in 1965 to cater to all fields of study. Onwards, congress has passed legislation that has improved the student loan program, including expanding the eligibility and allowing parents to loan on their children’s behalf.

What Are The Benefits Of Student Loans?

It is easy to apply. Unlike other loans, student loans are easy to apply for as not much authentication, and financial guarantees are required.

They are easy to qualify for. Qualification for student loans is acceptance by a college or university to do a certain course as a full-time student. You can easily check your qualifications.

It pays for more than just tuition. Apart from catering for the tuition, student loans also provide finances for the students for out-of-pocket needs.

Lower Interest rate. Compared to other forms of loans, student loans offer a relatively low-interest rate in repayment.

Gives you the flexibility to study. The loan repayment will only commence once you are done with the studies that you have enough time to focus on your studies.

Flexible repayment options. Most student loan repayments are spread across a long period. Some give the student 20 years which offers the borrower enough time to pay.

Student Loan Debt Statistics

From 2008 to 2010, student loan debt soared by an average of 61%, making them almost unsustainable.

An average of 14% of parents, according to the 2019 statistics, took out loans to aid their college students.

In 2020, 55% of bachelor’s degree students had student loans. Federal and private debt averaged $28,400 in debt by the students who graduated. 

Statistics highlight that today, one in four outstanding student loans are defaulted, with 18-34 year-olds accounting for most.

Over 11 million people took private student loans in 2011. That’s an increase from 2.9 million the previous decade.

Before the coronavirus pandemic hit us, 11.1% of student loans were 90 days or more in default. The federal government offered relief measures to cushion the borrowers.

The average monthly student loan payment was set at $300 before the federal government suspended it until August 31st, 2022.

Private Student Loan Statistics

Private Student lenders have about $136 billion in student loan debts. The average private student loan debt stands at $31,200. 

The 2020/2021 academic year averaged $12 billion in private loans alone.

Private loans are seen as the last resort for students, which explains why more than half of the students (53%) consider private loans after exhausting all avenues of federal public loans.

Private student loans have an average interest rate repayment of 11%.

While some find it easier to default federal public student loans, private loans are harder to default.

Some borrowers may have an easier time than others with paying back their private student loans due to various reasons, including family income and the occupation they plan on getting when they graduate. Lack of employment after graduation may contribute to loan repayment defaulting.


While most people will say that taking student loans for their studies is worth the cost, some might not be so lucky to gain employment. Student loan debt continues ballooning as defaulters increase each day.

The statistics are scary, and if measures are not put in place, the debts will become unsustainable.