How many Americans have student loan debt? | The Sun
FOR decades now, Americans have been swimming in student debt.
In the US, student debt increased at a rate of 20 percent in the last ten years, leaving college graduates with hefty payments.
The rate is growing by 7.8 percent every year, turning into a crisis in the trillions.
How many Americans have student loan debt?
With it continuing to worsen, college graduates owe a collective $1.75trillion in student loans.
As of 2022, there are an estimated 44.7million Americans who have student loan debt, according to Education Data.org.
Part of the reason why the debut is so high is because of inflation, which has increased the cost of college by 602.5 percent since 2000, according to the Education Data website.
Another issue weighing heavily on the student loan crisis is the degree one obtains.
In recent years, a Master's Degree has now been considered to have taken the place of a Bachelor's Degree, with more jobs requiring advanced education to be hired or promoted in a job.
For those 25 and older, about 13 percent moved on to receive their Master's degree, resulting in an average of an additional $71,287 in student loan debt.
What has Joe Biden done about student loan debt?
Ever since his campaign trail days, President Joe Biden made a vow to cancel $10,000 in student debt per borrower.
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And finally, he has come through on that.
On Wednesday, the President made the official announcement that will provide relief to millions of borrowers.
Anyone with outstanding student debt who earns less than $125,000 annually qualifies for forgiveness.
The relief can go as high as $20,000 for those who went to college with a Pell Grant.
But for others, it will be $10,000 per borrower.
Additionally, Mr Biden has paused payments four different times to help relieve the burden on Americans who were financially hurt during the Covid-19 pandemic.
Along with the decision to forgive thousands of dollars in student loans, the Biden administration announced it was extending the student loan repayment pause until the end of the year for one final time.
"Borrowers should plan to resume payments in January 2023," the education department said.
Meanwhile, progressives and even some corporate Democrats including New York Senator Charles Schumer called for Mr Biden to cancel up to $50,000 per student borrower.
But it was evident that the President was never keen on going that high.
Why has the cost of college increased so drastically?
At the start of the millennium, the average American who received their Bachelor's Degree accrued a student loan debt of about $17,297, roughly $13,000 less than the average debt in 2021.
The student debt crisis took hold during the 2008-2009 recession, prompting students to cross the $1trillion threshold in student debt.
Since 2000, the nation has seen a 76 percent growth in student loan debt at the time of graduation.
Forbes reported last year that the tuition for a college education is a contender for the top spot for increasing in cost, only second behind hospital care.
College tuition has increased faster even than the cost of housing, child care, and medical services over the last twenty years.
As more students pursue a college education, the cost comes down to supply and demand with more students taking out student loans in the hope it will benefit them long term.
Nicole Smith, a chief economist at the Georgetown University Center on Education and the Workforce spoke with CNBC last year to explain the reason for the general uptick in loans.
“People who went to school in the ’70s and the ’60s, they actually paid for college while working, she said.
"They would take a summer job and they would pay their tuition."
“And by the time they graduated, they would be debt-free or just, a couple [of] hundred dollars, a couple [of] thousand dollars to get by, they pay that off in a couple of years and move on with their lives.”
She said in 2020 that roughly 30 percent of students have gone into default on their student loans, are late in their payments, or have stopped making payments altogether.
The result is a delay in students crossing life milestones such as getting married, buying a house, and having children.
Smith said, "…If you view student loan debt as negative wealth, as money that could have been used to save for wealth or to purchase a home or to invest in the stock market to accumulate wealth, that potential wealth is now used to repay loans."
To stay up to date on the latest news about student loan payments, check out The Sun's live blog.
And learn more about how workers in certain fields can qualify for student debt forgiveness, regardless of income.
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