Nearly 45 million Americans now owe a total of $1.7 trillion in federal and private student loans, for educations both finished and unfinished. The scale of the problem is undeniable in terms of the effects it takes on people's mental health, quality of life, and overall wellbeing.
Now that President Biden has officially stated that he supports forgiving $10k of student loan through legislative action, many Democrats think it’s not nearly enough. Some claim the federal debt forgiveness could easily reach $50k per borrower, and some go as far as saying to erase all the amount altogether.
In an interview with Vox, Laura Beamer, lead researcher on higher education finance at the Jain Family Institute, said that it’s abundantly clear that “people with student debt are less likely to own a house, they’re less likely to start a business, they’re delaying normal financial life cycles than previous generations past.”
For many previous generations, starting a family and saving for retirement were natural life decisions, but student loan borrowers don’t feel like they have the luxury of doing so. “We also know that people 50 and above are the fastest-growth student debt loan-accruing debt group, because they’re taking loans out for their kids or their grandkids,” Laura Beamer added.
Another crucial point about student loan borrowers is that not all loans are equal. The economist Steven Deller from the University of Wisconsin Madison argues that “There is a huge difference between someone who assumes a lot of debt and gets an MBA from Harvard or a medical degree from Columbia University, and ... a first-generation student who’s coming from a poor family background and goes into debt and doesn’t complete their degree.”
These two individuals are words apart, and while for one, the student debt doesn’t feel like a big deal with a successful career prospect and stable financial background which comes from the family, the other is likely to carry the same burden throughout life, hoping for a cash windfall one day.
