In August 2020, student debt is at over $ 1.67 trillion in the United States, just behind mortgage debt and well above credit card and auto loan debt. It took over the ability of many Americans to buy homes, get married, or expand their families.

Paying for college is not more affordable for most families. Here is a breakdown of student loan debt with the most recent numbers and how you can meet them.

What Was Student Loan Debt Like In 2018?

Most of the numbers that break down the personal impact of student loans for 2019 and 2020 are yet to be fully verified, making 2018 the last full year for which data is available.

According to The Institute for Access to and Success in College (TICAS), almost two-thirds (65%) of students who graduated in 2018 had student loan debt.

This does not include people who were already repaying their student loans. About one in six Americans – or about 43 million – had some form of student loan debt in 2018, according to the Center for American Progress. One third of all adults aged 25 to 34 have a student loan.

Average student debt

Student loan debt varies by type of institution. Students in private schools borrow more money than those in public universities. The most recent data available on TICAS and College overview break down the student loan debt of public and private universities up to the 2017-18 school year.

• The average student loan debt for graduate students in 2018 was $ 29,200, up 2% from 2017.
• The amount of money owed for student loans varies widely from state to state. The Utah average was $ 19,750 and the Connecticut average was $ 38,650.
• Institutions matter too. Private student debt was $ 33,148 and public student debt was $ 27,777.

Total student debt

Student debt continues to increase. Although full figures are available for previous years, total student debt can be broken down by private and federal debt using data from Credible.

• Total federal debt for student loans: $ 1.5 trillion.
• Total private student loan debt: $ 119 billion.
• Total federal student loan borrowers: 43 million.

Student loan repayment status

The Federal Reserve Bank of New York says that even though millions of loans are past due or in default, they are likely under-represented due to deferred loans, forbearances, or grace periods that are currently unpaid.

Consider these key statistics of Experiential:

• Federal student loans past due or in default for more than 90 days: 12%.
• Federal student loans in repayment: 55.8%.
• Federal student loans deferred or forbidden: 19.8%.

Many federal student loans also come in some sort of income-based repayment plan. Here is a breakdown of the repayment plans as of December 2018, according to the US Department of Education:

• Standard repayment plan (10 years or less): 12.7 million.
• Pay As You Earn (PAYE): 1.31 million.
• Revised Pay As You Earn (REPAYED): 2.57 million.
• Income Based Reimbursement (IBR): 3.57 million.
• Reimbursement according to income: (ICR): 690,000.
• Progressive repayment plan (10 years or less): 3.39 million.

Reasons why student debt continues to rise

Each year, more students graduate with student debt than the year before. In 2010, the United States had $ 749 billion in federal student debt. A decade later, that number has more than doubled.

There are several reasons why student loan debt continues to rise, including:

• Cost of participation: College Insight Data shows that for the 2017-18 school year, students paid $ 9,333 just in tuition and fees to attend a four-year public university. In 2007-08, it was $ 6,098. The more a student has to pay to attend college, the more money he needs to borrow.
• Longer reimbursement: With income-driven repayment plans, deferral, forbearance, and default, millions of borrowers take decades to pay off their loans. Longer repayment periods, coupled with new students taking out student loans to pay for their education, mean more debt.
• Private student loan needs: While federal grants, scholarships, and student loans do not cover the full cost of tuition, many students are turning to private student loans to fill the gaps. Although private student loans represent a smaller fraction of overall student loan debt, they cost more. Private student loans may have higher interest rates and more fees than federal student loans.

Ways To Eliminate Student Loan Debt

If you are struggling with growing student loan debt, you have a some options to deal with it.

• Consolidate loans: If you have federal student loans, consider bundling them all into one. You probably won’t reduce your payments or your interest rate, but it can help keep your monthly payment under control if you only have to follow one due date rather than several. And if you’re lucky enough to have a lower interest rate, you may be able to lower your overall monthly payments.
• Join an income-based repayment plan: You will make affordable payments based on your income and the number of people in your household. After 20 or 25 years of eligible payments, your remaining loan balance is canceled. You may also be eligible for loan forgiveness programs depending on your profession, which could reduce your repayment period even further.
• Make additional payments or increase the monthly payments: If you can afford it, avoid making minimum payments and instead lower your total balance by making higher monthly payments. If you get a bonus at the end of the year, make an extra payment on your loans.
• Refinancing: If you have a mix of federal and private student loans, refinancing can lower your monthly payment, lower interest rate, or both. If you have good credit and can get an interest rate lower than what you’re paying now, explore different avenues for refinancing to see if it’s right for you. But remember, you lose federal protections when you refinance because you will have to do it with a private company.

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