Does Student Debt Spell Trouble for America’s Youth?

College Graduation

Researchers from the Urban Institute have released a new study exploring the demographic boundaries of student loans and their impact on the U.S. economy.

The study, by Caroline Ratcliffe and Signe-Mary McKernan, analyzed which demographics bear the highest burden of student debt, what borrowers are afraid of, their ability to pay loans back, and how this phenomenon has increased over the years.

Since 1989, student loans have become the second most prevalent debt held among 29- to 37-year-olds in America. The debt is dispersed across demographic lines, with 16 percent of whites carrying student loan debt, 34 percent of African Americans doing so, and 28 percent of Hispanics holding it.

One finding showed that roughly half of students with debt did not finish their degrees. The problem with this situation is twofold: Not only are students leaving school early — before having developed a robust skill set — they are doing so with an amount of debt almost assured to make life harder. Average student debt hovers around $26,000 dollars.