The burden of college student loan debt can haunt your finances for decades after you finish school.
According to a new survey from higher education resource Intelligent.com, a large number of those attending college in the United States are unable to pay off their loans after 10 years (the standard repayment period for federal student loans), or even after 20 years.
In fact, 42% of those who borrowed money for college 21 or more years ago are still repaying their debt — and of that group, 45% owe between $10,000 and $49,999.
Meanwhile, the survey also showed that many American college grads are now in favor of mass student loan forgiveness, though roughly 1 in 5 oppose the idea.
Student loan borrowers are struggling to pay off their debt
Of the survey respondents, 27% reported having taken out student loans in order to pay for their education, and 61% of them said they were still paying off their loans today.
As noted, more than 4 in 10 of those more than 20 out of college still owed student loans, while for those who graduated 11 to 20 years ago, 54% still had debt.
As for debt totals, 43% of those who left school 11 to 20 years prior still owe between $10,000 and $49,999, while 45% of those more than two decades removed from college had debt in this range.
On a positive note, however, those who finished their studies within the last five years were less likely to still have debt, compared to those who left school in the last six to 10 years (60% versus 76%). This could signal that overall student loan debt is easing.
On the other hand, college debt seems unlikely to completely disappear anytime soon. A recent Princeton Review survey indicated that nearly all of this year's college applicants will need financial aid of some sort, including student loans, in order to pay for their education.
Nearly half of all Americans support federal student loan forgiveness
The heavy student loan burden has sparked calls by some for blanket student loan forgiveness from the government. However, not everyone agrees on this approach.
Specifically, the survey found that:
- 49% of Americans are in favor of mass federal student loan forgiveness
- 19% oppose it
- 32% are undecided
Many of those in favor of this idea see it as a way to juice the economy as it reels from the COVID-19 pandemic. Specifically, 62% of forgiveness proponents cited economic benefits, such as freeing up consumer funds. Among those who currently have student loans, 80% pointed to potential upside for the economy.
Pandemic effect goes beyond student loans
The COVID-19 crisis has affected college students in other ways. A different survey, also by Intelligent, found that popular majors for incoming freshmen this year have shifted, in part due to desires for better pay after graduation, job opportunities and job security.
The survey did note some divide in opinion between those with college debt and those without, as the debt-free respondents were almost three times as likely to oppose mass forgiveness (25% versus 9% of those with student loans).
Still, large percentages of respondents did express support for student loan forgiveness — in particular, 74% of those with student loans and 56% of those without.
Interestingly, high-income earners were more likely to support government forgiveness for student loans than those earning less. Those in favor of forgiveness included:
- 58% of high-income earners (making $100,000 or more annually)
- 52% of middle-income earners (making between $50,000 to $99,999 annually)
- 45% of low-income earners (making less than $50,000 annually)
Methodology: Intelligent.com administered its survey via Pollfish on April 12, 2021 to 1,250 Americans (ages 18 and up) who were past students of a post-secondary education program. Survey participants came from a range of educational backgrounds, including those who did and do not currently have student loan debt.