Black Women Still Hurt Financially From COVID, Diminishing Their Ability To Repay Student Loans
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Black Women Still Hurt Financially From COVID, Diminishing Their Ability To Repay Student Loans

Student loans
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Still reeling from the COVID-19 pandemic, unpaid student debt has created a double-edged sword for Black women.

The pandemic made gender disparities worse and put millions of women in situations beyond their control. And those forces have made it even harder for Black women and other women of color to repay their outstanding student debt, based on a new report by the Center for Responsible Lending (CRL).

The research shows that women, especially women of color, are still battling with money challenges and student loan payments as the economy grows stronger.
“We already knew that women of color bear the brunt of financial inequities. They have higher student loan debt balances and are charged higher interest. Because of persisting pay disparities, and little or no generational wealth, women of color have fewer opportunities to pursue a debt-free education or to withstand an economic or personal crisis,” stated Sunny Glottmann, a CRL researcher.
Glottmann explained, “Women carry about two-thirds of the $1.7 trillion of federal student debt, with Black women more than twice as likely as white men to owe more than $50,000 in undergraduate student loan debt.”
She pointed out, “Payment pauses are a temporary fix and don’t address longstanding issues within the higher education and financial systems. The only way to provide real, significant relief is to cancel $50,000  in debt and reform our educational system.”
    Top findings from the report included:
  • “Due to increased childcare responsibilities, as well as the high-contact, low-wage nature of many women’s occupations, women of color and women who could not work remotely have less job security today than pre-pandemic.”
  • “The economic gains made through 2021 were not shared equally across racial groups. Women of color continue to experience difficulty paying for necessities such as food and housing.”
  • “Student loan debt burdens remain at staggering levels, despite the payment pause. Black women and Latina borrowers typically have higher student loan balances than white women, making repayment more difficult.
  • “Although the focus group participants found the student loan payment pause helpful, they worry about their ability to start paying again once payments resume.”
  • “Because of their difficulties in repaying student loans, women are reluctant to incur more student loan debt for themselves or their children.”

Among actions to fix the problem — along with Glottmann’s debt cancellation proposal — the CRL recommendations included applying for a retroactive IDR waiver. It could “help millions of borrowers who have spent time in default and are most impacted by predatory for-profit colleges, economic downturns, and personal crises that require an exit from their workplace.”

Another suggestion is to invest in debt-free education pathways for women of color.Federal and state governments need to invest more in public and private Historically Black College and Universities (HBCUs). The federal government should also double the Pell Grant, offer more internship opportunities to HBCU students, and allocate more federal contracts for research purposes to HBCUs.”

 


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