South Carolina was recently ranked eighth on a list of states coping with the most student debt in a new study.
“Unchecked, unlimited and unpaid student debt has the potential to trigger a national economic disaster,” said Andrea Lee Negroni, adjunct associate professor of law at the Washington College of Law – American University.
According to the U.S. Department of Education, total outstanding college loan balances stood at nearly $1.64 trillion at the end of the first quarter of 2023. That is an average of over $37,000 for each of the 43.8 million borrowers.
“Estimates indicate about $125 billion of student loans are presently in default; one million new defaults occur annually; and one quarter of student loans go into default in the first five years of their repayment periods. These statistics are worse than for other types of consumer loans and do not bode well for the economy,” Negroni said.
The website WalletHub released Aug. 2 the 2023’s States with the Most and Least Student Debt report. It was published just weeks before student loan payments are expected to resume on Sept. 1 after a nearly three-year payment pause due to the pandemic.
The report examines 12 key metrics across 50 states and Washington, D.C. with a focus on the population aged 25 to 34.
The 12 key metrics include:
- Average student debt
- Proportion of students with debt
- Student debt as share of income
- Share of student loans in past-due or default status
- Share of federal student loan borrowers enrolled in an income-driven repayment plan
- Share of student-loan borrowers aged 50 years and older
- Grant and student work opportunities
- Unemployment rate among population aged 25 to 34
- Underemployment rate
- Availability of student jobs
- Availability of paid internships
- Grant growth
- Presence of student loan Ombudsman Law
South Carolina came in eighth on the ranking of student debt by state and fourth for student debt as percent of income.
For average student debt, South Carolina was ranked 11th, and it ranked 12th for the proportion of students with debt.
The state landed in the high 20s for student loans in past-due or default status, availability of student jobs, paid internships and grant growth.
The three states with the most student debt are Pennsylvania, Delaware and Mississippi, according to the report. The states with the least amount of student debt are New Mexico, Hawaii and Utah.
“My advice to would-be student debtors is that if you are not sure why you want college or how you will finance it, take the time to figure it out. And despite recent news, please do not assume the government will bail out student debtors in the future,” Negroni said.
Data used to create the rankings was collected from the U.S. Census Bureau, Bureau of Labor Statistics, Institute for College Access and Success, Federal Reserve Bank of New York, Council for Community and Economic Research, U.S. Department of Education – College Affordability and Transparency Center, U.S. Department of Education – Federal Student Aid Office, Internships.com, LendEDU, The Pew Charitable Trusts and Indeed.
Help keep the City Paper free.
No paywalls.
No subscription cost.
Free delivery at 800 locations.
Help support independent journalism by donating today.