A Breakdown of Average Student Loan Debt

A Breakdown of Average Student Loan Debt
portrait of Jessica Bryant
By Jessica Bryant

Published on July 6, 2021

Share on Social


You may have heard that student loan debt is in crisis. Unfortunately, that's not an exaggeration. About 44.7 million U.S. borrowers collectively owe more than $1.7 trillion in student loans. And that number increases by the day.

More than 30% of loan borrowers are late in their payments, in default, or have stopped paying entirely just six years after graduating. Young borrowers have increasingly reported delaying plans to buy a home, save for retirement, or start a family due to student debt.

Despite calls for action from progressive lawmakers and policy groups, President Biden has yet to cancel any student loan debt by executive order. So for now, at least, the burden of student loan debt continues to weigh on millions of Americans.

Breaking Down the Current Student Loan Debt

The amount owed in student loan debt varies by type of loan, repayment status, plan, and servicer.

Loans in forbearance accounted for the majority of outstanding student debt in the U.S as of September 2020, largely because the government suspended mandatory loan payments as a COVID-19 emergency relief measure.

However, loans in repayment accounted for the largest portion of student debt before the pandemic. In early 2020, $693 billion in loans were in repayment, while only $162.6 billion in loans were in forbearance. Now, loans in forbearance make up 67% of outstanding debt.

Below is a breakdown of debt figures under the Direct Loan program as of the end of 2020. Loans under this program account for $1.32 trillion of the total $1.7 trillion student debt load.

Loan Status Amount Owed Number of Borrowers
In repayment $14.7 billion 400,000
In deferment $114.4 billion 3.2 million
In forbearance $887.4 billion 22.2 million
In default $122.2 billion 5.5 million
In grace period $43.7 billion 1.7 million

Source: Federal Student Aid

This table excludes loans belonging to students currently in school and loans whose status is unknown or considered "other."

Average Student Loan Debt by Demographic

Much like with wages and wealth in America, there are clear racial and gender disparities in student loan debt. In some cases, loan debt disparities are so prominent that some experts theorize they could be part of the cause behind growing wealth inequalities in the U.S.

Black Borrowers Owe More Than Their White Peers

On average, Black graduates owe about $7,400 more in debt than their white peers upon graduation. Four years after graduating, that gap nearly triples to $25,000 and almost half of all Black borrowers (48%) owe more than they borrowed after graduation compared to just 17% of white borrowers.

Black students are also much more likely to take out federal loans to fund their undergraduate education than their white, Hispanic, Native American, and Asian counterparts.

During the 2015-16 academic year, 71% of Black students used federal loans compared to 56% of white students, 50% of Hispanic students, 38% of Native Americans, and 31% of Asians.

Black women in particular take on more student loan debt than black men and any other racial or ethnic group. On average, they will borrow approximately $37,558.

According to the American Association of University Women, 57% of Black women making payments toward their debt four years after graduating were unable to cover essential expenses. And during the first 12 years of repayment, Black women's loan debt grows on average by 13%.

Women Hold More Debt Than Men

Women of all racial and ethnic groups hold almost two-thirds of all student debt in the U.S. They account for approximately $929 billion of the national $1.7 trillion total. Just one year after graduation, female borrowers' average debt is almost 10% higher than male borrowers'.

In addition to owing more debt, women are also more likely to make higher monthly payments toward their debt, yet it takes them about two years longer than men to pay it off. This is typically due to the fact that women tend to have lower incomes than men.

Graduate-Degree Holders Carry Large Share of Debt

Although the majority of borrowers have associate degrees or less, households with graduate or professional degrees hold the majority of student loan debt. This particular statistic has become part of the argument against student debt cancellation.

When Sen. Elizabeth Warren (D-Mass.) and Senate Majority Leader Chuck Schumer (D-N.Y.) proposed the cancellation of $50,000 in student loan debt per borrower, critics were quick to point out that high-earning households and borrowers with elite educations would likely benefit the most.

However, a recent report by the Roosevelt Institute found the opposite to be true: the proposed plan "is progressive (and) would provide more benefits to those with fewer economic resources and could play a critical role in addressing the racial wealth gap."

Where Debt Cancellation Is Now

President Biden did not immediately cancel student loan debt by executive order, but he has asked Education Secretary Miguel Cardona to evaluate the consequences of canceling up to $50,000 of debt per borrower. For many, this gives a sign of renewed hope that debt cancellation isn't completely off the table.

As the wait for action continues, some economists have concluded that the current $1.7 trillion debt balance will never be paid off by borrowers alone. In the meantime, nearly 45 million borrowers, a large segment of whom are minorities, struggle to strike a balance between making loan repayments and meeting their basic needs.


Feature Image: Peter Dazeley / Photodisc / Getty Images

As master's degree programs have grown in popularity, graduate student loan debt has increased substantially. An MBA can open the door to many high-paying jobs in the business field. Learn about the best MBA jobs in 2021, from accountant to product marketing manager. This landing page acts as an introduction and overview of online college planning resources for students.