A new Gallup poll has found that consumers who graduated college between 1990 and 2014 and have at least $50,000 in student loan debt are 60 percent worse off financially than their debt-free counterparts. Their physical well-being was also found to be 38 percent worse than peers who graduated without the onus of student debt.
Survey results show that the greater a graduate's student debt, the worse his or her physical and financial health. About 59 percent of degree earners during the study period reported graduating with student loan debt. Twenty-seven percent borrowed less than $25,000, and 11 percent borrowed more than $50,000. The average cost of tuition and college fees has risen 1,120 percent since 1978, four times faster than the consumer price index. In the last five years alone, borrowing for college has almost doubled from $640 billion to $1.24 trillion, while the default rate has more than doubled from 7 percent to 14.7 percent.
Student loan debt is often cited as a burden that prevents young adults from obtaining a mortgage and buying a home. Goldman Sachs economists Eli Hackel and Hui Shan analyzed homeownership rates of young adults aged 25 through 34 and found that, after controlling for factors such as marital status and ethnicity, having more than $50,000 in student debt reduces the chance of owning a home by 8 percent.