October 23, 2012

Average Student Debt in 2011 reaches $26,600

The Institute for College Access and Success (TICAS) recently released a report detailing average student debt amounts for the class of 2011. Of the students that earned a bachelor’s degree that year, two thirds held student debt amounting to $26,600 per student on average. The highest levels of debt were found in the Northeast and Midwest, while the South and West had lower levels of student debt. The student borrowing increase is particularly troubling since many recent graduates face high unemployment rates and low salaries when they leave school, making it more difficult to repay loans.

While higher sticker prices generally correlate with higher debt amounts, this is not always so: small private colleges may have large endowments or enroll fewer low-income students and therefore have small average debt rates. For example, Princeton and Yale Universities, with estimated cost of attendance of over $50,000 per year, have some of the lowest student debt rates in the nation. Private for-profit schools, however, have some of the highest tuition and debt rates in the nation, with some reports estimating 96 percent of students take out loans, and borrow 45 percent more that students at private non-profit and public institutions.

Washington is performing better than the national average both in the percentage of students taking out loans, and average debt at graduation. Fifty-six percent of Washington students took out loans (vs. 67 percent nationally) and average loan amount at graduation totaled $22,244 in 2011 ($4,356 below the national average). These statistics include averages from public and private non-profit institutions, but exclude data from private for-profits. The UW’s statistics are even more encouraging: less than half of UW students took out loans, and average debt amount at graduation in 2011 was $20,316, more than $6,000 below the national average. Furthermore, UW students are less likely to default on their loans: UW’s three-year cohort default rate (CDR) is 3.1 percent, compared to the national CDR average of 13.4 percent.

Despite UW’s better than average loan data, it is important to note average debt has been growing every year, even at the UW, and other forms of financial aid are still critical in order to preserve access and set graduates up for success when they leave school.

To read more, check out our brief on the subject, and TICAS’ interactive debt mapping tool.