10+ Hidden Student Loan Debt Facts 2023

Looking for top student loan debt facts, you must know? Keep reading!

A student loan is a real-life challenge that many of us are trying to get rid of as soon as possible.

As you all know, a student loan is totally out of control in the United States these days, and the increase has come as historically high shares of young adults going to college and the constantly increasing cost of higher education. 

According to educationdata.org, the outstanding federal loan balance is $1.635 trillion and accounts for 92.4% of all student loan debt.

So while investing in a college education is inevitable, the life-long effects of debt can’t be overlooked.

A huge percentage of students are entering the workforce with prodigious amounts of student debt, while older generations are still struggling to pay off their student debts year after education.

In this article, we’ll explore some key student loan debt facts in the United States that most of you may not know about, based on the data from the Federal Reserve and the U.s Department of Education. Let’s get started! 


1. A Student loan is the Second-Largest Source of Household Debt 

A Student loan debt is one of the fastest-growing sources of household debts, surpassing both credit card and auto loan debts in 2010.

Total student loan debt is the second-largest source of household debts, consistently outpacing other non-mortgage household debts. 1

Read: What Is Debt Financing? 

Read: Average Student Loan Debt?

2. Student Loan Debt Has Doubled Since 2008

percentage of undergraduates

The student debt was around $600 billion in 2008, which has become doubled in 2020, totaling nearly $1.6 trillion.

The growth in debt has increased significantly with an increase in the number of college-going students.

As per the Department of Education, the percentage of undergraduates has risen by 2% and by 12% for the graduate level.

3. Student Loan Debts in America have Exceeded the Trillion-Dollar Mark 

The statistic of the federal reserve Q3 2018 shows that the student loan debt in the USA has hit a record of 1.5 trillion dollars (about $4,600 per person in the US), followed by motor vehicle loans is 1.1 trillion dollars, and credit card debt which is 1 trillion dollars.

A decade earlier, car payments were the biggest monthly issue, but now student loan debt is a permanent part of a monthly expense surpassing the vehicle expense. 2

Read: What Is Debt Relief? – Everything You Need To Know

4. A Small Fraction of borrowers owe the Most

Small Fraction of borrowers owe the Most

One of the most mind-blowing facts is that a third of all outstanding student debt is owed by 6% of the borrowers.

6% of the borrowers owe more than $100,000 in debt, while 2% owe more than $200,000.

The six percent owe 1/3 of the outstanding $1.5 trillion debt. On the other hand, 18% of borrowers owe less than $5,000 loan debt, and they jointly owe 1% of debt outstanding, 

5. Adults between 25-34 of Ages have More Student Debt 

Student debt is more common among the age group 25–34-year-old.

According to data from The Washington Post, a third of adults in this age group have federal student loans, followed by 18-24- and 35–49-year-olds.

In this age range, people face financial commitments like first-time mortgages, building a family, or even building a family or even adding graduate student loans into higher education debt, which makes it hard to make monthly payments. 3

6. Women Have More Student Loan Debt

Women Have More Student Loan Debt

It is hard to believe, but women owe more student loans than men. In 2019, women owed around $929 billion (about $2,900 per person in the US) in student loans.

Women have a higher graduation rate than men, which is why they are more in student loan debt. Also, despite having higher education, women have fewer earnings than males. 

7. Most Student Debt is Owed to the Federal Government 

A few decades ago, student loans were provided by private lenders but subsidized and backed by the federal government, but today, around 92% of all the outstanding student loan debt is owed to the federal government, while the remaining 8% is lent by the private financial institutions. 4

8. Many Students Borrow to Cover the Living Cost

Students Borrow to Cover the Living Cost

A vast majority of students take student loans to cover the cost of living.

The student borrowing patterns among those for whom financial aid covers the whole tuition bill are similar to those who have to pay the tuition.

The borrowing percentage of students with no net tuition was $24,000, while those who pay net tuition borrowed around $28,000.

Read: 10 Best Debt Relief Companies For Credit Card Debt

9. Graduate school borrowing takes up most part of outstanding student debt

Over the last few years, graduate students’ borrowing has risen a lot.

Between 1995-2015, the average yearly loan for graduate students grew to $18,210 from $10,130.

And over the same period of time, it grew from $3,290 to $5,460 for undergraduate students.

Currently, loan for graduate education accounts for 56% of outstanding student debt.

10. Black borrowers & students at for-profit schools have the highest default rate for federal student loan

Black borrowers have high default rate

Because of employment outcomes, lower earnings, and higher average debt levels, the default rate for students who attended for-profit schools in comparison to profit schools is the highest.

According to the recent data available, 34% of students who attended for-profit schools in the academic year 2011–2012 & entered repayment of their loans by 2017, defaulted.

Similarly, black borrowers have a high default rate of 29%.

11. Student Debt is affecting the economic outlook for Americans

According to the federal reserve experts team, student debt may lead to a decline in the homeownership rate.

From the year 2005 to 2014, the homeownership rate for American households dropped by 4% points.

And the home led by someone in the age group of 25–34 dropped by 9% points.

Student debt is also affecting the economy, hampering small businesses, and posing a hurdle in early retirement, among other things. 5

12. Young college students with college debt are more likely to struggle financially than those without it

Young college students in debt

College graduates in the age gap of 25-39 with college debt are more likely to struggle financially when compared to graduates without debt.

Every three in ten college graduates owing a student loan (32%) say that they are not facing much financial hardship compared with 51% of graduates of the same age without outstanding loans.

13. A majority of students with bachelor’s degree graudate with no or little debt

Among all bachelor’s degree recipients, 30% graduated with no debt. 23% of those graduated with $20,000 or less in loans, and less than 20% of graduates owe more than $40,000.

When it comes to a for-profit school, nearly half of the borrowers owed more than $40,000, and only 12% of students who attended a public college owed the same.

Read: Debt Relief Programs – Understand Your Options Available With Their Cons

How Did Student Loan Debt Raise So Much?

Wrapping Up

In this article on 10+ Hidden Student Loan Debt Facts 2023, we shared some shocking student debt facts with you.

The cutthroat competition and the race to be ahead and live a financially secure life are all reasons that lead students to take student loans.

However, the high-interest cost leads them into a debt trap and causes them more harm than good.


What is the current status of student loan debt?

Over the last two decades, there has been a rise in student debt, as it has nearly doubled now.

As of September 2022, around 48 million student loan borrowers owe more than $1.6 trillion.

What is the cause of high student debt?

Due to high competition, many students feel like they need to attend the best college, acquire degrees, etc.

And spending more time in graduate schools means spending more money. According to sources, 40% of outstanding federal debt is taken out for masters or Ph.D. degrees. 6

Which state has the highest student debt?

South Dakota ranks number with 71.4% in student debt, followed by West Virginia (68.16%) and Pennsylvania (66.95%).

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The National Planning Cycles is committed to producing high-quality content that follows industry standards. We do this by using primary sources, such as white papers and government data alongside original reporting from reputable publishers that were appropriate for the accuracy of information while still being unbiased. We have an editorial policy that includes verifiable facts with due credit given where applicable.

  1. https://www.pgpf.org/blog/2021/05/10-key-facts-about-student-debt-in-the-united-states[]
  2. https://educationdata.org/student-loan-debt-statistics[]
  3. https://www.nerdwallet.com/article/loans/student-loans/student-loan-debt#:~:text=Forty%2Dfive%20million%20Americans%20have,%24600%20billion%2C%20federal%20data%20show.[]
  4. https://www.investopedia.com/articles/personal-finance/081216/who-actually-owns-student-loan-debt.asp[]
  5. https://educationdata.org/student-loan-debt-economic-impact#:~:text=Student%20Debt%20Reduces%20Spending&text=Economists%20agree%20that%20when%20consumers,by%20as%20much%20as%203.7%25.[]
  6. https://www.cnbc.com/2022/05/06/this-is-how-student-loan-debt-became-a-1point7-trillion-crisis.html[]
  7. https://www.cnbc.com/2022/05/06/this-is-how-student-loan-debt-became-a-1point7-trillion-crisis.html[]

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