Back to school and the burden of student loans

The rising costs of a college education have forced many Americans to take out student loans that leave them saddled with debt. Consider just three stark statistics:

More than 44 million Americans carry an aggregate $1.45 trillion in student debt.
The average class of 2016 graduate has $37,172 in student loan debt, up 6 percent from last year.
The student loan delinquency rate is 11.2 percent (90+ days delinquent or in default).

Millennials are hit particularly hard by the student loan debt crisis. About four-in-10 adults under age 30 have student loan debt. Approximately one-fifth of young workers with student loans have more than one job.

Student debt acts as a major financial headwind, delaying Americans from reaching life’s big milestones like purchasing a car, buying a home and starting a family.

As much as 35 percent of the decline in young American (defined as ages 28-30) homeownership from 2007 to 2015 has been credited to higher student debt loads.
52 percent of millennials say their student debt prevents them from making a major purchase, like a car.
62 percent said they have put off saving for retirement or other investments.
28 percent said that student debt delayed their decision to start a family.

The majority of student loans are federal and originate with the Department of Education – not a bank. In fact, banks’ market share of servicing and origination is less than 10 percent.

The banking industry says it is doing its part to help mitigate the burden of student loan debt in America. Those steps include partnerships with roughly 4 percent of the nation’s employers to offer a student loan repayment program employee benefit. The American Bankers Association has joined that group, offering eligible employees up to $1,200 per year up to a lifetime maximum of $10,000.

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