In 2014, data shows that the average household has a $26,000 student loan debt and that roughly 37 million Americans now owe more than $1 trillion on their student loans. Each student loan repayment that a student graduate makes means less money for investing in a home or contributing to a retirement fund.
A study published in the Federal Reserve Bank of St. Louis Review last September showed that the net worth for a household with no outstanding student loan debt is nearly three times the net worth of a household with student debt.
Under Sen. Tom Harkin’s, D-Iowa, Health, Education, Labor, and Pensions committee, student loan debt is also a drag on the U.S. economy and shows federal loans total $100 billion each year. The committee would like to simplify student loan borrowers repayments, as well as discuss overhauling the federal student loan program as part of the reauthorization of the Higher Education Act.
With the currently student debt crisis, more needs to be done to ensure student borrowers understand their obligations and rights and that they have access to loan borrowing counseling and payment options.