Many Americans still owe tens of thousands in student loan debt 10 years after graduation

African American family celebrating graduation with cake on summer deck, worried about how student loan debt might affect their graduate's life in the future. African American family celebrating graduation with cake on summer deck, worried about how student loan debt might affect their graduate's life in the future. Image:

In a Nutshell

It turns out 10 years might not be enough time to get rid of your student loan baggage. A Credit Karma analysis of U.S. Credit Karma members found high levels of student loan debt after borrowers had passed the decade-long standard repayment term. And the older they were, the more they owed.

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A decade after graduation and beyond, many degree-holding Americans still carry significant amounts of student loan debt.

How significant? A recent analysis of approximately 60 million U.S. Credit Karma members found that those with student loan debt owed an average of $33,834.

What’s more, Credit Karma found that it isn’t just newer grads who are living with high levels of student debt. Even graduates ages 43 and older were still tens of thousands of dollars in student loan debt a decade or more after completing their degrees. (Learn about our methodology.)

Key findings

About 1 in 5 Credit Karma members (19%) has student loan debt, collectively owing more than $526 billion.
Student loan debt ranks No. 3 for the highest amount of debt held by Credit Karma members, behind auto loan debt (No. 2) and mortgage debt (No. 1).
Among the 53 million Credit Karma members who carry some kind of debt, 29% carry student loan debt, owing an average of $33,834.
Student loan debt exceeded credit card debt by multiples across every age group we examined. For example, members ages 22–32 with debt had 14 times more student loan debt than credit card debt.
Members 43 and older had the highest average amount of outstanding student loan debt, at $41,014 per person.

All numbers based on analysis of approximately 60 million U.S. Credit Karma members in July 2018.


Student loan debt for the ages

As the American student loan crisis continues to make headlines, Credit Karma’s analysis illustrates just how far the problem can persists beyond the years of undergrad and graduate school.

In fact, high levels of student loan debt occurred across every age range we examined.

Age range Total student loan debt by group Average student loan debt per person

22–32

(likely to include undergraduate degree holders)

$200,302,310,674 $28,706

33–42

(more likely to include both undergraduate and master’s degree holders)

$181,674,586,698 $39,165

43+

(more likely to include undergraduate, master’s and Ph.D. degree holders)

$158,137,241,351 $41,014

 

Considering that the 43+ age group is the most likely to include those with debt due to obtaining advanced degrees, it may come as no surprise that each member of this cohort has the most student loan debt on average.

However, at age 43 or older, that likely still puts each of these members at least 10 years beyond the average time it takes to complete a Ph.D. program.

And assuming a 43-year-old member of this group wanted to pay down their $41,014 in student loan debt before retiring at age 65, that would mean 22 more years of at least $257 in payments each month (assuming a low 5% interest rate).

Student loans are ultimately costlier than credit card debt

APRs on federal student loans are typically among the lowest interest rates of any type of credit product, like private loans or credit cards. Interest rates for federal direct student loans disbursed between July 1, 2018, and June 30, 2019, range from 5.05% for undergraduate degrees to 7.6% for loans issued to parents or to graduate or professional students.

By contrast, the average credit card interest rate as of May 2018 was 15.54% among accounts assessed interest, according to Federal Reserve data. And Americans owed $10.39 trillion in revolving credit debt as of June 2018.

Yet Credit Karma members still repaying their student loans had significantly more student loan debt than credit card debt.

  • Members ages 2232 had student loan debt 14 times greater than their credit card debt.
  • Members ages 3342 had 13 times more student loan debt than credit card debt.
  • And those 43 and older had 12 times more student debt than credit card debt.

Total credit card debt among U.S. Credit Karma members analyzed came out to $252 billion. Total student loan debt among members was more than twice that amount, topping $526 billion.


What to do when 10 years isn’t enough

Ten years is the standard repayment term for most federal student loans. And generally, borrowers must begin repaying federal student loans six months after leaving college (with or without a degree) or reducing their attendance to less than half-time enrollment.

If you’re struggling to repay your student loans within your repayment window, or can’t afford your monthly payments, you do have options.

  • Consider an income-driven repayment plan. If your monthly loan payment is more than you can afford, you can apply to have the payment capped at a percentage of your discretionary income. As you earn more or your family size changes, your payment could change, too. You can learn more about income-driven repayment plans at StudentLoans.gov.
  • Extend your repayment term. Borrowers with eligible federal student loans may be able to extend their repayment term to 25 years. Keep in mind that while extending the term may reduce your monthly payment, it also means you’ll be paying more interest over the life of the loan. Contact your loan service for information.
  • Give yourself extra days each month. If your federal loan payment is due before you receive your first paycheck of the month, you may struggle to make that payment. However, you can ask your student loan servicer whether you can change your payment due date.
  • Consider consolidating loans. If you have more than one federal student loan, keeping track of them may be difficult. Consolidating multiple student loans into a single consolidation loan could simplify the repayment process.

Finally, remember that at least some of the interest you pay on your student loans may be tax deductible when you file your federal income tax return. For tax year 2017, you could deduct the lesser of $2,500 or the amount of interest you actually paid during the year on a qualified student loan. However, the more you earn, the less you may be able to deduct. Be sure to check the IRS rules for the latest on the student loan interest deduction before trying to claim it.


Methodology

To conduct this analysis, Credit Karma looked at approximately 60 million U.S. members, of which about 53 million carried some kind of debt (credit card, mortgage, auto loan, etc.), in July 2018. We then analyzed the approximately 15 million Credit Karma members who had student loan debt and sliced the data by three different time windows: 22–32 (to represent the 10-year repayment window after obtaining an undergraduate degree), 33–42 (to capture members who may have obtained an undergraduate degree and master’s degree, and have begun to pay down the associated student loan debt); and 43+ (to capture members who may have obtained an undergraduate degree, master’s degree and doctoral degree, and have begun to pay down the associated student loan debt). All data analyzed by Aashika Balaji. Percentages have been rounded to the nearest whole percent. All dollar amounts are rounded to the nearest dollar. All numbers are rounded to the nearest whole number.