August 3, 2011
Low Debt to Income Ratio for College Grads in WA
Kiplinger has released a map showing average student debt versus average income across all fifty states, as well as categorizing institutions they have identified as the most expensive and the ‘best values’. The UW comes in as the 10th best value public institution in the nation for 2010-11.
The map illustrates that Washington state students have a relatively low debt to income ratio: Average student debt is between $15,000 and $20,000, while average income is around $40,000 to $50,000, with about 61 percent of all students in the state taking out loans. Utah boasts the smallest amount of debt per student (under $15,000), while New Hampshire has the highest average debt load (over $25,000 per student).
These state level data are consistent with our most recent UW data. In 2009-10, 50 percent of all UW undergraduates borrowed and their average cumulative debt was $19,500. Although these figures are lower than the national average, they have increased over the last several years, especially as state funding cuts have necessitated tuition increases. This is why the UW Board of Regents voted to substantially increase the UW’s commitment to financial aid for resident undergraduate students starting this fall.
Note that Kiplinger also shows that students appear to be increasing their use of credit cards while in college, with 84 percent of students holding at least one credit card and half of all students holding four or more. The mean credit card balance was a record $3,173.