Which States Have the Most Student Debt?
In recent years much has been made about the amount of educational debt former U.S. students find themselves saddled with after graduation. That’s because, second to mortgages, student loans make up the largest portion of American household debt, with outstanding balances totaling $1.41 trillion according to the according to the Federal Reserve Bank of New York. Given this reality, a new study by WalletHub sought to quantify student indebtedness in each of the 50 states and the District of Columbia.
For their main findings, WalletHub scored each state on a number of factors. The measuring indebtedness components included Average Student Debt, Proportion of Students with Debt, Student Debt as Share of Income, and more. Each score also considered Grant & Student Work Opportunities, incorporating the Unemployment Rate Among Population Aged 25 to 34, the Underemployment Rate, Availability of Student Jobs, and Grant Growth among other data points.
With a high overall score of 71.41, South Dakota was found to have the highest level of student debt. The home of Mount Rushmore ranked 1st in terms of student indebtedness, while placing 35th in grant and student work opportunities. In second was West Virginia with an overall score of 68.16, although it actually came in 3rd for both indebtedness and opportunities. Rounding out the top five were Pennsylvania (66.95), New Hampshire (65.15), and Ohio (63.84).
On the other end, Utah placed 51st with a low overall score of just 13.77. The Beehive State also ranked last in indebtedness but 29th in student grant and job opportunity. Meanwhile, up at #45, Alaska took the top spot in terms of opportunity but came in with an overall score of 31.88. Other low-scoring states include Hawaii (15.60), Wyoming (24.66), California (25.22), and Washington (30.18).
Looking at just the average student debt itself, New Hampshire actually ranks first, followed by Pennsylvania, Connecticut, Deleware, and Minnesota. Once again, Utah comes in last with the nearby states New Mexico, California, Arizona, and Nevada also placing near the bottom. Other interesting findings include Mississipi having the highest percentage of student loan balances past due or in default (Massachusetts had the lowest) and Vermont being home to the highest percentage of student loan borrowers over the age of 50 with Hawaii on the other end of the spectrum.
Although this new study does little (or nothing, in fact) to solve the growing student debt problem, the findings are interesting nonetheless. Additionally the survey does highlight the important role that location can play in whether or not a degree will ultimately pay off or not. With that, such factors will likely need to be added to the list of considerations prospective student and parents will need to make when it comes to financing higher education.