Student loan debt is becoming more and more pervasive in the lives of young people across America.
Americans owed about $1.5 trillion in student loans at the end of March 2019, more than two times what they owed a decade earlier, according to Pew Research Center.
Many of the schools leaving students with the greatest amount of debt are in Pennsylvania, according to a new report from LendEDU, a financial product comparison website.
A LendEDU analysis of student loan debt figures at nearly 1,000 four-year private and public higher education institutions nationwide revealed Pennsylvania to have the fourth-highest average student loan debt per borrower among all states and the District of Columbia at $35,510.
There were only six schools in Pennsylvania among the top 250 institutions with the lowest debt and just one in western Pennsylvania – Waynesburg University with an average debt per borrower of $23,944.
But there were 54 schools in the Keystone State among the top 250 institutions with the highest debt, with Washington & Jefferson College leading all Western Pennsylvania schools at $45,306.
Michael Brown, a research analyst with LendEDU, hypothesized that steeper costs of living contributed to Pennsylvania and other mid-Atlantic and northeastern states having comparatively high amounts of student loan debt, as the top eight average student loan debts per borrower belonged to states in those regions plus the District of Columbia.
Seventeen of the top 24 public schools across America with the highest debt were Pennsylvania institutions, including Penn State’s Erie, Altoona, York, Harrisburg, Berks, Hazleton and University Park campuses, and the University of Pittsburgh and its Greensburg, Johnstown and Bradford campuses.
“(I’m) fairly confident we’re going to continue to see the cost of higher education continue to go up,” Brown said.
And Brown thinks the trend will continue because schools are “allowed to run amuck in terms of where they set their prices.”
The upshot, Brown says, is more young adults graduating from college saddled with so much student loan debt that they live with their parents longer and hold off on buying homes, getting married and having children.
“It’s affecting so many millennials and young Americans,” Brown said.
But Brown noted that Ivy League schools, powered by large endowments, have done a “great job” lowering student loan debt, as they have policies of meeting 100% of a family’s demonstrated financial need.
Per the most recent U.S. Department of Education data, more than 4.9 million borrowers entered repayment of a federal student loan between Oct. 1, 2014, and Sept. 30, 2017, with 10.8% of them defaulting on their loans.
Fiscal year 2015’s cohort default rates included 7% for California University of Pennsylvania borrowers, 4% for Waynesburg University borrowers, 13.5% for Fayette County Career & Technical Institute borrowers, 7% for Laurel Business Institute borrowers, 3.3% for Washington & Jefferson College borrowers and 6.9% for Seton Hill University borrowers, meaning those percentages of borrowers defaulted or met a specified condition.
Brown suggests pursuing scholarships and grants at the federal and state levels to chip away at student loan debt and touted income-driven repayment plans for federal student loans that set loan payments to be affordable based on income and family size.
Brown also recommends waiting a year or two after graduating to refinance student loans because graduates need time to build credit history and might not have a high-paying job right out of college.
And if you want to get a sense of how prevalent student loan debt is in the lives of young people, Brown recommends following the 2020 presidential race, noting the fervent attention that Democratic presidential candidate plans to address student loan debt have already attracted.
“It’s definitely more of a national issue than it ever has been before,” Brown said.