Here’s a story you think you’ve heard before: Go to college. Work hard. Get a degree. Find a good-paying job. Buy a car, a house, and maybe raise a few kids. Life’s good.
But these day’s there’s a new twist to that plot: It’s called student debt. And the latest facts and figures on that debt from the Fed are sobering. Total student debt now stands at nearly $900 billion – about $200 billion more than total credit card debt – and about 15 percent of us are saddled with it.
But here’s what really caught our eye: as many as 27 percent of borrowers are behind on their monthly student loan payments. Consumer bankruptcy lawyers say they’re seeing a big jump in the number of student loan borrowers knocking on their doors. They’re even talking about it as the next “debt bomb” for the U.S. economy.
We headed to the campus of the University of Southern California to talk to students about the debt they’re racking up. And we talked to Marketplace education correspondent Amy Scott about the impact it is having on those students’ future and the economy.
“There’s some evidence that young people might be postponing big purchases like cars and homes, and even putting off starting a family, things like saving for retirement or for their own kids college.” Scott said. “So that’s money that isn’t going into the economy. So the impacts are beyond the individual level.”
The numbers make that clear. The average student loan debt is $23,000, according to the New York Fed. About 10 percent of borrowers owe more than $54,000. And 3 percent owe more than $100,000.
For more on the options students have to deal with that debt, and for insight on the value of a college degree, listen to the full interview above.