Students Borrowed Less in 2013-14

Here’s actually some good news about student debt: borrowing by undergraduates is now declining.

Annual borrowing by all full-time undergraduates peaked at $6,122 per student in the 2009-10 academic year and fell to $5,490 by 2013-14, according to the Urban Institute’s new report, “Student Debt: Who Borrows Most? What Lies Ahead?”

For its shock value, the media toss around the $1.2 trillion figure – the total of all U.S. student loans outstanding. The institute provides a more refined look at student debt by diving into U.S. Department of Education data to learn who tends to borrow the most and why.

The findings are summarized here:

• High debt accumulations – over $50,000 – remain rare among undergraduates.
• Still, 10 percent of all bachelor’s degree recipients owe more than $50,000, compared with just 1 percent a decade ago.
• 37 percent of graduate degree recipients borrow at least $50,000 – more than double the percent in 2004.
• A larger share of graduates of for-profit colleges have these high debt levels. The next highest levels are at private universities, with public colleges last.
• The longer students attend school, the more they owe. Bachelor’s degree recipients have more debt than those with two-year associate’s degrees. Graduate degrees result in more debt than undergraduate degrees, and professional degrees are associated with the most debt.
• Students from low-income families tend to have less debt, often because they earned shorter-term certificates or associates degrees.
• Students who default on their student loans, possibly due to low incomes after college, owe $14,380, on average – less than the $22,550 average for all students.
• Undergraduates who are no longer dependent on their parents are at a higher risk of accumulating large debts. These independent students are over 24, or are married, have children, or are foster children or wards of the courts.