The Average Student Debt in N.J. is $30K — Among Worse in U.S.
A new study finds the Garden State is ranked 9th in the nation when it comes to student loan debt.
According to data crunched by LendEDU, a private internet marketplace for student loans and refinancing, the average debt per borrower in New Jersey is $30,563.
The study also finds 63 percent of Jersey college students are taking out loans to pay for their higher education.
The study finds the average student loan debt nationwide is $28,400.
“The growth of student debt over the past decade is incredibly concerning,"vsaid Ethan Senack, a higher education advocate for the New Jersey Public Interest Research Group. "Back in 2005 we had a couple of hundred million dollars in student debt. Today that number has ballooned to over $1 trillion."
He stressed the negative impact of rising student debt can be seen on young people after they graduate from college.
“Whether they’re deciding to buy a car, or to buy a house or get married, it’s definitely an issue of concern,” he said.
“Tuition at New Jersey’s public colleges averages around $13,000, the 4th highest in the country. It’s no coincidence the state cut per-student spending by 28 percent since the recession, so we shouldn’t be surprised with those tuition hikes and budget cuts to see New Jersey’s student debt so high,” said Tom Allison, the deputy director of policy and research of the group Young Invincibles, a national organization working to engage young adults on issues, such as higher education, health care, and jobs.
“We know that debt impacts individual people’s lives. Imagine $300 coming out of your paycheck every month. It’s going to be really difficult,” he said.
Senack stressed taking on significant student loan debt can be very tough for young people.
“You know this is often the first financial decision they’re making and we’re talking about tens of thousands of dollars in student loan debt,” he said. “And there’s a lot of concern about the way that both federal and private loans are serviced, especially when it comes to issues like failing to give students accurate information, failing to inform them when their loans have been transferred to another agent.”
He said the problem is becoming so pronounced that “I think there’s a really strong conversation at the Department of Education right now on how to better regulate student loan servicers. It’s a very critical conversation to be having.”
Allison stressed there is no one size fits all formula to figure out how much student debt you should take on.
“It depends what resources you may have, it depends what you want to do later on in life. If you take out $100,000 and you want to be an anesthesiologist, then you’re probably going to be okay, but if you take a $5,000 loan and you maybe don’t complete your degree, then you’re going to have some serious financial turmoil.”
Even with all the problems surrounding student loan debt, “we know on average college is still the strongest investment anyone can make. College graduates have lower unemployment, higher wages, even lead healthier lives. Debt is out of control but in many ways a college education is still worth it and that’s not going away.”
He noted by 2020, it’s estimated that 65 percent of all jobs will require some sort of post secondary degree or credential.