Like most Americans, Amy Eichberger wasn’t raised by parents who could easily afford her college tuition. Her dad died before she was born, and her mom lived paycheck to paycheck. Eichberger, by her ownaccount, wasn’t the best student in high school and struggled to get scholarships.
So, she had to take out loans.
This was in the early 1990s. Tuition for the community college in her Connecticut town cost no more than a few hundred bucks a semester. But upon getting her associate’s degree and thriving in an academic setting, she decided to level up, getting her bachelor’s in public health. Then, facing lacklusterjobprospects, she pursueda master’s in health care administration. Eventually, she went back to school again, completing a two-year graduate program required of her current job.
All in all, she owed $349,769.18 for that education.
Americans now hold$1.7trillion in student loan debt. Nearly two-thirds of that money – at least $929 billion – is owed by women.
Eichberger was in search of economic mobility – of moving from working to middle class. And indeed, her opportunities expanded as her credentials grew. Yet tuition rates soared at the same time: The average cost of attendance at a four-year college nearly tripled between 1980 and 2019. Eichberger’s debt snowballed at every turn in her academic journey, as did her expenses. She had a daughter, and became a single mother, while getting her master’s.
“I took out loans for everything because I'm not making $1 million a year,” said Eichberger, 51. “It just piled on, just kept piling on.”
The debt Eichberger was left with – more than her house is worth – is exceptional. On average, borrowers with graduate degrees have roughly $103,000 in student loans. But the circumstances she faced are not that unusual, particularly among the country’s women.
According to research published in 2021 by the American Association of University Women, women with bachelor’s degrees graduate with an average of $2,700 more in student loan debt than their male peers. That gap compounds over time, as women take two years longer on average to pay off their debt, the interest adding up all the while.
As borrowers await the Supreme Court’s decision on a plan to provide mass student debt forgiveness, USA TODAY examined what’s behind the gender imbalances in the amount that borrowers take out and in their ability to pay those loans back.
Get ready: Regardless of SCOTUS decision, 25 million people will have to repay student debt.
First, what’s going on with student loans?
President Joe Biden has made it a top priority to forgive up to $20,000 in student loan debt for middle- and low-income Americans. The conservative-majority U.S. Supreme Court is now deliberating two cases that challenge Biden’s plan, with most of its right-leaning justices signaling clear skepticism of the plan’s merits and the administration’s authority in granting relief.
The status of various student loan-related programs and initiatives rests on the high court’s decision. Under former President Donald Trump, for example, the Education Department, citing the pandemic’s emergency circumstances issued a moratorium on student loan repayments. The country’s tens of millions of borrowers haven’t had to make repayments in the years since, with Biden repeatedlyextending the pause.
But those repayments could return as soon as this summer, pending the Supreme Court’s ruling. A separate lawsuit is pushing for a quicker end to the payment pause.
Then last week, Senate Republicans introduced a bill that would ban Biden's loan forgiveness plan, even while it's on hold and before the Supreme Court.
Advocates worry about what all of this meansfor women in particular.
More: With Biden's student loan debt forgiveness in limbo, lawmakers consider colleges' role
OK, so why do women have more student debt than men?
Thanks largely to her advanced education, including a certificate program she completed relatively recently, Eichberger secured a white-collar HR job at Yale New Haven Health. But it wasn’t enough to cover the nearly $5,000-a-month she owed for her loans.
She wound up getting a second job doing manual labor in an Amazon warehouse on Saturdays and Sundays to help pay off the debt and affordnecessities such as groceries. The pandemic had just hit and the moratorium on repayments had begun, but Eichberger was preparing for their imminent return.
Women, and women of color in particular, are paid less than similarly educated men for the same jobs. So, they are more likely to return to school to bolster their resumes and earn a salary that can support all their expenses, which areoften greater than that of men.
“Women are out there getting degrees because women are required on so many levels to bring credentials to the table,” said Gloria L. Blackwell, CEO of the AAUW. “That's why that proportion of student debt is so high – these women have to constantly prove themselves over and over again.”
More: How the student loan payment pause changed people’s lives
Student debt relief blocked,potentially hurting Black and Latino families the most
Consider these statistics:
Women who graduate with a bachelor’s degree earn roughly $35,000 on average – just 81% of what their male peers make.
A year after college, women hold a little more than $31,000 in student loan debt, which works out to a $307 monthly payment. Yet the average woman a year out of college spends more than $1,300 on housing and car payments a month, plus another $520 on child care expenses for the 16% of recent female graduates who are moms.“Adding in that $307 student loan payment makes it difficult – if not downright impossible – to make ends meet,” the AAUW report notes.
Black women ages 25-64 who hold a bachelor’s degree or higher and work full timehad a median salary of $60,681 in 2020, according to the Education Trust's research. The median salary for similarly educated white men was $91,805, while it was $75,329 for Black men and $67,324 for white women.
The average Black woman needs at least a bachelor’s degree to earn a higher salary than an average white man with no college degree.
Eichberger didn't get paid maternity leave so she had to go into forbearance during that time, still accruing interest. Child care needs also forced her to take lower-paying jobs than she would otherwise so she could have a flexible schedule.
"It is basically stretching out your loan, many, manymore years with many, many more years of interest being tacked on," she said.
Equal Pay Day? Not for teachers: Why men make more than women in female-dominated field.
For Black women, 'more debt does not equate to a higher salary'
College costs have soared over the past several decades, far outpacing inflation and increases in financial aid such as Pell Grants that are reserved for low-income students. Declining state funding for public higher-education institutions is a key reason for the ballooning in costs.
Will this make a difference?The Pell Grant amount will rise by $500 in 2023.
In 1980, according to research by the nonprofit Education Trust, the maximum Pell Grant covered more than half of the cost of a public four-year college. By the 2020-21 school year, the maximum Pell Grant covered just 28%.
Students without the means have been forced to take out more student loans as a result. The challenges are particularly pronounced among women of color, who are far more likely than their male peers to attend college but far less likely than white women to be able to afford it.
More: Women still don't get the top jobs or pay even in industries they dominate
“The notion is that you get a degree so you can be competitive in the workforce,” said Brittani Williams, who co-authored the Education Trust brief and is herself a Black woman borrower and mother in the midst of completing her PhD. But for women, and especially those of color, “more debt does not equate to a higher salary.”
Still, Williams doesn't question the worth of her college studies. "For those of us who hold degrees, even with the student loan debt, we see greater opportunity than those who for whatever extenuating reason could not complete that degree," she said. "I hope we don't lose that ideal" of higher education as a path to the middle class for women and people of color.
For Williams and Blackwell, bringing college costs down is key to solving the student loan crisis.
“At the end of the day, college should be affordable for everyone – not just for an elite few,” Blackwell said."And women, in particular women of color, shouldn't have to sacrifice their financial future to get the education that certainly is a potential pathway for equal economic opportunity."
Is college worth it?Americans say they value higher education, but it's too expensive for many
Confusion over Public Service Loan Forgiveness
Biden is also working to reduce the burden of debt on borrowers eligible for public service loan forgiveness and income-driven repayment.
Public-service loan forgiveness, or PSLF, relieves the student debt for people such as teachers, military members, first responders and certain healthcare workers after they’ve spent a decade on the job. But the rules have never been clear, and the administration of the program has always been messy.
Public Service Loan Forgiveness: Feds bet on changes to rules for another debt relief option
Despite working in eligible roles for more than a quarter century, Eichberger for her part long struggled to have her debt forgiventhrough the program. She says she’d submit forms and never hear back.
“I was like, ‘Okay, I'm just stuck with this debt. It’s going to be here until I die. My kid’s going to inherit it,’” Eichberger said.
"You live in denial but it was always sitting over there. It was so daunting – that’s your life. And then you second guess that (the degrees) were worth it but you can’t do anything about it now.”
Less than 1%: More than 41,000 public service workers sought federal student loan forgiveness. The government approved just 206.
Last year, with the help of a student loan coaching service offered through her health-care job, she resubmitted a PSLFapplication. She didn’t think the coaching service,offered by EdAssist by Bright Horizons, would work. But in Januaryshe received a life-changing letter: Her nearly $350,000 in student debt had been erased. She owed $0.
The revelation has since become bittersweet. Eichberger’s 26-year-old daughter – an aspiring sign language interpreter – tried college for a semester before dropping out. Shetold Eichberger it was her fear of loans, having seen what they did to her mother and their family, that convinced her to give up.
“This is probably what hurts me the worst," Eichberger said.“She saw my struggle, which made her not want to further her education.”
A mixed bag: Debt relief will change the lives of some with student loans, but fall short for others.
Contact Alia Wong at (202) 507-2256 or awong@usatoday.com. Follow her on Twitter at @aliaemily.
This article originally appeared on USA TODAY: Student loan debt: Why women owe the bulk of it, how it affects them
FAQs
Do women hold 2 3 of the student loan debt? ›
Women hold 58% of all student loan debt. Female student borrowers have an average debt is 9.6% higher than their male peers one year after graduation. Women take an additional two years on average to pay off student loans. Black women have the highest average amount of debt.
How does student debt affect women? ›Student debt is making it nearly impossible for many women to afford their basic living expenses after graduating from college. AAUW's 2021 Deeper in Debt report finds: Women hold an average of $31,276 in student debt, leaving them with a monthly loan payment of $307 the year after graduation.
Why do American women hold 2 3 student debt? ›MILWAUKEE — Women hold two-thirds of the $1.7 trillion outstanding student loan debt in the country, according to a report from the American Association of University Women (AAUW). The report says that discrepancy is due in part to women taking out more to begin with and facing a pay gap after graduation.
Why do women hold more student debt? ›Therefore, there is a financial gap that many female students have no choice but to bridge with student loans. Additionally, women are more likely to spend more time in higher education than men. It is a simple reality that the more time spent in higher education, the more student loans are necessary to cover tuition.
Why are so many women in debt? ›Women take more time off than men
As women are more likely to take time off from the workforce to care for children or aging parents, they tend to earn less over time. The earnings gap is smaller early in one's career, but widens significantly as workers age, get married and raise families.
Americans now hold $1.7 trillion in student loan debt. Nearly two-thirds of that money – at least $929 billion – is owed by women.
Who suffers the most from student debt? ›Forty-five million Americans have student loan debt — that's about one in five U.S. adults (17.4%), according to an analysis of census data. Those ages 25 to 34 are the most likely to hold student loan debt, but the greatest amount is owed by those 35 to 49 — more than $600 billion, federal data show.
Who is mostly affected by student loan debt? ›70% of White and Caucasian student borrowers have student loan debt. Four years after graduation, 48% of Black students owe an average of 12.5% more than they borrowed. After that same period, 83% of White students owe 12% less than they borrowed.
Who holds more student loan debt men or women? ›Overall, 44% of the sample (with an average age of 26) had student loan debt. Women (47%) were more likely than men (40%) to have student debt. Black adults (50%) were more likely than white adults (44%) and Hispanic/Latino adults (37%) to have student debt.
Why student loans are a problem? ›The debt burden not only impacts that generation, limiting their employment options and slowing their financial progress, but it also impacts future generations. A family will have a hard time saving up for college costs for their children if mom and dad are still paying off their loans.
Why do Americans have so much student loan debt? ›
It's the result of a decades-long explosion in borrowing coupled with soaring education costs. The Federal Reserve data shows people under the age of 30 are more likely to have student loan debt compared with older adults – underscoring the crippling burden on another generation of Americans.
How many people are affected by student debt in the US? ›Data Summary. As of 2022, 43.5 million Americans have federal student loans. Approximately 13% of all Americans had federal student loan debt in 2021. In 2022, 9.9 million borrowers have between $20,000-$40,000 of student loan debt.
Are women more likely to be in debt? ›A report by the Education Data Initiative found that women are more likely to have high student debt balances and large monthly student loan payments—even though they make 26 percent less than their male counterparts. And despite the larger payments, women often take two years longer to pay off their loans.
What race has more student loan debt? ›Black adults are 1.5 times more likely than white adults to have student loan debt. The following graph includes federal and private student loan debt among all adults. On average, Black, non-Hispanic adults in the U.S. also hold higher student loan debt balances than borrowers of other races.
Who is at fault for the student loan crisis? ›While economists are divided on who to blame for the student loan crisis, nearly all experts agree the primary fault does not lie with student borrowers. Some instead blame colleges, pointing to tuition rates at private institutions that skyrocketed from $17k in 1988 to nearly $36k three decades later.
Why are there so few women in finance? ›Some possible reasons for the disparity include: Women are less likely to have a background in finance. Women are less likely to be promoted to senior roles in finance. Women face gender discrimination in the financial industry.
Are women or men better at finances? ›Not surprisingly, studies have found that the average woman's investment strategy and eventual performance tends to be more stable than the average man's. In 2021, CNBC reported on a Fidelity study that found women investors are outperforming men.
Do men save more money than women? ›There's a gender gap in retirement savings, including 401(k) contributions. Women have significantly less money saved for retirement than men.
What percentage of Black women have student debt? ›The situation is even more significant for women of color. 41% of female undergraduates take on student debt, compared to 35% of male undergraduates, and more women take on debt for graduate studies as well. More than 70% of Black students go into debt to pay for higher education, compared to 56% of white students.
What is the average student loan debt for Black women? ›A year after completing a bachelor's degree, Black women hold more student debt than any other group — with an average of $38,800 in federal undergraduate loans. Black female borrowers who attended graduate school hold an average of $58,252 in graduate loans.
What percent of black people have student debt? ›
Ninety percent of Black students take out student loans to pay for college, compared to 66 percent of white students. Four years after graduating, Black students hold almost twice as much student debt as their white peers, largely due to differences in interest accrual and graduate school borrowing.
How much would it cost for college in the US to be free for everyone? ›Over an 11-year time frame, a First-Dollar Tuition-Free program would cost a total of $800 billion. The cheapest free college program, the Last-Dollar Tuition-Free program would cost $28 billion the year it is implemented. Free college would cost on average three times what federal tax dollars pay for now.
Do rich people take student loans? ›"Nearly 60% of all student loan debt is held by the rich and upper-middle class," he said in a May 21, 2022 newsletter. "So, by forgiving student loan debt, we would be handing the wealthy a financial windfall while low income Americans suffer further from inflation and rising costs."
Who is most affected by student loan forgiveness? ›Student loans are not just a problem for young adults. The Department of Education estimates that more than one-third of the borrowers who will get relief are age 40 and up, including 5 percent who are senior citizens.
Do student loans go away after 7 years? ›If the loan is paid in full, the default will remain on your credit report for seven years following the final payment date, but your report will reflect a zero balance. If you rehabilitate your loan, the default will be removed from your credit report.
What gender has the most debt in America? ›This isn't to say there are no differences in how men and women apply for and use debt and credit. Indeed, men carry more overall debt than women, including across most debt categories. But women carry more student loan debt and often have more credit cards.
What are 3 reasons student loans should be avoided? ›- Student Loan Payments Can Become Financially Crippling. The typical monthly payment for student loan borrowers is between $200 and $299, according to a Federal Reserve report. ...
- Default Can Lead to Serious Consequences. ...
- They May Not Be Enough to Cover All Your Expenses.
In the United States, student loan debt is nearing $2 trillion, and Californians carry approximately $150 billion of the debt. Student loan debt is now the second highest consumer market after mortgages.
How bad is student loan debt in America? ›Student loan debt has ballooned to nearly $1.63 trillion in the U.S. That figure is spread across 43.5 million Americans for an average of $37,574 per borrower, according to a BestColleges analysis of student debt. Those figures, not surprisingly, have caused concern among many prospective college students.
Why is student debt a major problem in America? ›Students are generally borrowing more because college tuition has grown many times faster than income. The cost of college—and resulting debt—is higher in the United States than in almost all other wealthy countries, where higher education is often free or heavily subsidized.
Why is it so hard to pay off student loans? ›
If you're wondering, why do student loans take so long to pay off? Capitalized interest may be the culprit. Complicating the issue is the fact that borrowers who opt for an income-driven repayment plan after graduating may not be earning enough to keep up with the total interest accrued.
How can we solve student debt? ›- Forgive student loan debt.
- Streamline existing forgiveness programs.
- Cut or lower interest rates.
- Condense income-driven repayment.
- Fixes to income-driven repayment forgiveness.
- Make college tuition-free.
- Expand Pell Grants.
Student loan debt affects more than your financial independence and your standard of living. It also determines which dreams you're able to pursue and which ones will become a distant memory. You may find yourself sacrificing a job that offers you more fulfillment and purpose for a career with a higher salary.
Why should student loans be forgiven? ›Student loan debt is slowing the national economy. Forgiveness would boost the economy, benefiting everyone. Student loan debt slows new business growth and quashes consumer spending.
Does the government profit from student loans? ›So, even if the loan program initially looks like it yields a profit, it may ultimately yield a net cost after the program costs are re-estimated. The focus of federal student loan programs is on enabling students to pay for a college education and not to provide profit to the federal government.
What demographic carries the most student loan debt? ›70% of White and Caucasian student borrowers have student loan debt. Four years after graduation, 48% of Black students owe an average of 12.5% more than they borrowed. After that same period, 83% of White students owe 12% less than they borrowed.
Are men or women in more debt? ›This isn't to say there are no differences in how men and women apply for and use debt and credit. Indeed, men carry more overall debt than women, including across most debt categories. But women carry more student loan debt and often have more credit cards.
Which households hold the most student debt? ›Households above the median wealth owe the vast majority of student debt.
Who is impacted by student loan forgiveness? ›Roughly 90 percent of relief dollars will go to borrowers who earn less than $75,000 a year. Americans from all age groups will benefit.
What generation owes the most student loans? ›National Student Loan Debt
However, on the national scale, Millennials have a larger overall debt than Baby Boomers. Generation Z held 6.4% of the total $1.57 trillion student loan debt. Millennials held 30.4% of the total debt. Generation X held most of the debt at 38.8%.
Who profits from student loans? ›
Student loans are owned by the federal government or private institutions, depending on the type of student loan. Federal student loans are owned by the U.S. Department of Education while private student loans are owned by the financial institution that granted them.
What economic class has the most student debt? ›The highest-income 40 percent of households (those with incomes above $74,000) owe almost 60 percent of the outstanding education debt and make almost three-quarters of the payments. The lowest-income 40 percent of households hold just under 20 percent of the outstanding debt and make only 10 percent of the payments.
What race is most in debt? ›Black adults are 1.5 times more likely than white adults to have student loan debt. The following graph includes federal and private student loan debt among all adults. On average, Black, non-Hispanic adults in the U.S. also hold higher student loan debt balances than borrowers of other races.
Do women statistically make more money than men? ›In 2021, full-time, year-round working women earned 84% of what their male counterparts earned, on average, according to the Census Bureau's most recent analysis. Much of the gender pay gap has been explained by measurable factors such as educational attainment, occupational segregation and work experience.
Are women more financially stable than men? ›In our study, women were more likely than men to report a household income of $30,000 or less (29% versus 25%). Among women who have household incomes under $30,000, only 4% are Financially Healthy.
Does student loan forgiveness help the wealthy? ›The research found that blanket forgiveness options, such as canceling $10,000 or even all student debt, help high-income borrowers more than low-income ones. For example, full forgiveness would distribute about $190 billion to the top 20 percent of earners and only about $30 billion to the bottom 20 percent.
Which schools leave students in the most debt? ›Atop the list is Maine Maritime Academy, where 2019 graduates who borrowed left with an average debt load of $56,897 – nearly $27,000 above the average among all ranked colleges. See: How Average Student Loan Debt Has Changed in 10 Years.
Do the rich take out student loans? ›"Nearly 60% of all student loan debt is held by the rich and upper-middle class," he said in a May 21, 2022 newsletter.