Stunning: How Many Are Borrowing for College

One aspect of the top story that appeared in yesterday’s New York Times shocked me.

The number of students who borrow for college is much higher than I thought. I’ve routinely seen estimates that two-thirds of students take out loans for college. The New York Times, however, conducted an analysis that concluded that 94% of students who earn a bachelor’s degree borrow. That’s up from just 45% in 1993.

Only 7% of students at public colleges and universities graduate without borrowing while only 5% of grads at private schools can pull off this feat. The average debt is $23,300, but 10% of students borrow more than $54,000 and 3% borrow more than $100,000.

Here is the link to the NYT article:  A Generation Hobbled by College Debt

Why Do So Many Borrow?

Why do so many more students need financial help to attend college? As the article mentions, state governments have been shifting more of the responsibility to families:

Another College Cost Culprit

Colleges are also to blame because they have not been addressing the affordability issue in meaningful ways. Institutions routinely urge students to apply regardless of their family’s ability to pay. The following is an amazing statement from one of the nation’s most highly visible university president:

It’s Too Easy to Borrow

If a student wants to take out hideous amounts of debt to attend, it’s rare for a college to talk them out of it. Easy credit plays into this. Beyond the federal student loans, it’s not too tough to take out private student loans. So people who have no business borrowing this way can because the lenders know that they can almost never, ever get out from under their obligation. These private loans shouldn’t even be considered “student” loans and instead should be treated like unsecured loans. This distinction would reduce the amounts of money students can borrow recklessly for college because borrowers would enjoy more protections, including the ability to declare bankruptcy.

Unfortunately, student borrowing is often used by politicians for political posturing. I co-wrote an op-ed piece in The New York Times last week that touched upon this. Congress has been battling about a fairly insignificant student-loan issue while ignoring more important ones such  as college affordability. Here is the op-ed piece:

Much Ado About Student Loans

Not all college debt is bad. As I’ve mentioned on my college blog plenty of times, some debt is perfectly acceptable. If students borrow strictly through the federal Stafford Loan program, they should be fine. For most students that will mean borrowing a maximum of $27,000. Here is a post that I wrote recently on the subject:

What You Need to Know About Borrowing for College

Lynn O’Shaughnessy is the author of the newly released, second edition of The College Solution: A Guide for Everyone Looking for the Right School at the Right Price. 



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    1. Thanks Mary K for bringing that to my attention. I thought the 94% figure was amazing which is what prompted me to write the post!

      Lynn O’Shaughnessy

  1. Astonishing! I had no idea. Our idea is for our child to graduate debt-free. I guess we are in the minority. I have to wonder how many parents are prepared for retirement, hopefully they have saved for that over saving for college (I know that is what they advise). Thank you for the link to the NYT article.

    1. Hey KD — That makes two of us! My husband and I have been very fortunate that we haven’t had to borrow nor our kids. I mentioned the NYT article to my kids yesterday so they would appreciate just how lucky they are.

      Lynn O’Shaughnessy