Students and graduates in the United States have a combined student loan debt of $1.3 trillion. The average loan debt for the class of 2016 was about $40,000, with grads taking an estimated 21 years to pay it all back.
The pressure of student loan debt can be stressful, especially for African American students, who are more likely to borrow larger amounts of money than their white counterparts to support the cost of college. Black families are disproportionately trapped in the student debt mire. In fact, research shows that upwards of 40% of black families struggle with student loans. Not only do more have student loan debt, but they have more of it compared to their white counterparts, according to the Urban Institute.
Student Loan Financial Strain
The 2016 school year showed some startling numbers. Reportedly, some 9.6 million Americans with federal student loans can’t make their monthly payments. What’s more, 3.6 million are in default and have not made a payment in over a year. In addition, nearly 3 million are delinquent and at least one month behind on payments while another 3 million have deferred loans or received temporary permission to not make payments.
Studies show that some millennial men and women are delaying marriage, putting off starting families, and not purchasing homes. According to the report, How America Saves for College 2015―you’ll save 46% more for college than the average family if you set a goal together and create a saving plan. Since student loan debt is affecting so many millennials and beyond, the team at Nowsourcing created this graphic, powered by RefinanceStudentLoan.net, which offers tips for minimizing debt before and during school. Planning ahead is crucial to minimizing student loan debt.
Here are some of other suggestions to minimize student loan debt:
Estimate your total costs
College costs vary depending on the type of school you attend
Private Colleges: $32,405
Public out-of-state: $23,893
Public in-state: $9,410
Remember, room and board, cost of living, and school supplies are not included in the price of tuition. The average cost of room and board: $10,597, and for textbooks and supplies is another $1,200.
Look into other types of funding before relying on loans
In 2014–2015: $123.8 billion was awarded in scholarships and grants that do not need to be paid back; 37% were federal grants and need-based scholarships; 41% were university funded merit and need-based programs; and 14% came from private organizations like religious groups, companies, or other organizations.
Save money before college, so you don’t have to pay it back later
Only 57% of families are actively saving money for college, while on average, only 33% of tuition gets covered by scholarships & grants.