Saturday, 17 May 2014

Student loan | Student Loan Debt Dragging On Young Households - NBC News

Student loan | <b>Student Loan</b> Debt Dragging On Young Households - NBC News

<b>Student Loan</b> Debt Dragging On Young Households - NBC News

Posted: 14 May 2014 09:33 AM PDT

Younger Americans who are still paying off student loans have a lot less money — and a lot more overall debt — than those who don't have any student loans, a new report finds.

It's not clear why, but the report from Pew Research Center said one possible explanation is that people paying off hefty student loans have trouble gaining financial footing because they are bogged down by those college bills. Another possibility is that, as more people go to college, the wealth gap between those who borrow for college and those who don't is widening.

The Pew report found that nearly four in 10 households headed by a person under 40 has some student loan debt, a record high. The median student loan debt for that group was about $13,000.

The difference between those households and the ones with no student loan debt was striking.

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Among college graduates, the report found that younger households with student loan debt had a median net worth of $8,700. For college grads without student loans to worry about, median net worth was $64,700.

The college graduates with student loan debt also had nearly twice as much overall debt as those without student loans. The median total debt for those younger households was $137,010, compared to $73,250 for those without student loans. Total debt includes things like mortgages, car loans and credit card debt.

The Pew analysis was based on the 2010 Survey of Consumer Finances, a detailed look at Americans' financial well-being.

It did offer one bright spot for those burdened by student loan debt: They are making a lot more money than those who didn't get a college degree at all.

The Pew researchers found that the typical household income of college-educated households with student loan debt was $57,941, compared with $32,528 for those headed by someone without a bachelor's degree.

That's in keeping with other Pew research showing that despite the costs, it pays to go to college — perhaps more than ever.

First published May 13 2014, 11:25 AM

Allison Linn

Allison Linn is a senior business and economics writer for NBC News. Linn started in this role in November of 2006. She is responsible for reporting on the economy, consumer issues and personal finance for NBCNews.com, CNBC.com and TODAY.com.

Linn joined NBCNews.com from The Associated Press, where she was a business writer. In that role, Linn was responsible for covering Microsoft, Boeing, Starbucks, Amazon.com and other major Seattle companies. At the AP, Linn regularly broke major stories, including the theft of a portion of Microsoft’s source code and Boeing’s decision to lay off thousands of workers just days after the Sept. 11 terrorist attacks.

Prior to her work at The Associated Press, Linn worked at newspapers in Colorado, Washington and Oregon and spent nearly two years as a reporter and editor in Germany.

Linn is the recipient of multiple regional and national journalism awards. Her honors include three Society of American Business Editors and Writers awards for The View From the Auto Mall Darkens, Still Made in America and We are the Median. Linn also was a recipient of the Arthur F. Burns Fellowship. She speaks fluent German and lives in Seattle, Wash.

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