Who Would Student Loan Granting Help The Most?
Women would be among the biggest winners of student loan awards.
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Some critics of student loan waivers have argued that the policy would largely benefit the relatively wealthy, pointing out that college degrees lead to higher incomes.
However, new research has found that the greatest benefits of student debt relief have those with the least wealth, especially black families.
The cancellation of $ 50,000 for all borrowers, on which Senate Majority Leader Chuck Schumer of New York, and Senator Elizabeth Warren, D-Mass, according to researchers from the Roosevelt Institute. The average forgiveness in White and Latinx households in this lowest range of net worth would be over $ 11,000.
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Meanwhile, the average cancellation for those in the top 10% of net worth would only be $ 562 per person.
“These analyzes suggest that the cancellation rules for student loans are a good for society as a whole,” write the researchers at the Roosevelt Institute.
Here’s who else would benefit a lot from student loan issuance
Those who have attended for-profit schools
Approximately 25% of student loan borrowers attended for-profit schools that were scrutinized for misleading students about their programs and career results.
Borrowers who have attended these schools have a much harder time paying back their student loans than others: almost half of them go bankrupt.
Women owe 66% of the country’s $ 1.7 trillion in student loans outstanding.
On average, women borrow more than $ 31,000 to finance their education. Black women lose more than $ 41,000. Men now borrow around $ 29,000.
Women also take longer to pay off their college debts because they still make 82 cents for every dollar a man makes. More time on student loans means more interest and fewer resources for other important life milestones like buying a home or starting a family.
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More than a third of all women and 57% of black women who paid back their student loans said they couldn’t meet their essential expenses, according to the American Association of University Women.
According to university expert Mark Kantrowitz, more than 20% of the country’s outstanding student loan debt is held by people over the age of 50.
Many of these older borrowers are struggling. According to a CNBC report on U.S. Department of Education data, the average balance for borrowers ages 50 to 61 as of the end of 2020 was $ 42,290.32, while borrowers aged 62 and over owed an average of $ 37,739.13.
A third of student loan borrowers over 65 have defaulted, and half of those over 75 have defaulted, according to a report by the Government Accountability Office.
And tens of thousands of seniors have currently seized their social security benefits because of an unpaid student loan.