Student loan debt: Here are 7 ways the $1.6 trillion toll affects the U.S. economy - Th... - 0 views
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American families are carrying about $1.6 trillion in student loan debt, a massive burden that amounts to nearly 8 percent of national income. That share has roughly doubled since the mid-2000s.
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Years of research show that such post-college debt compels people to put off marriage and home ownership. It also stifles entrepreneurship and career paths.
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A $1,000 increase in student loan debt, researchers found, lowered the odds of marriage by 2 percent a month among female bachelor’s degree recipients in the first four years after graduation. That finding has been bolstered by more recent research showing a similar trend.
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a significant and economically meaningful negative correlation” between rising student loan debt and falling small-business formation. The mechanism isn’t hard to grasp: If you’re paying off a student loan, you’re less able to pull together the cash needed to start a business.
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The authors note that small businesses are responsible for “approximately 60 percent of net employment activity in the U.S.”
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This year, the Federal Reserve issued a report showing that student loan debt prevented about 400,000 young families from purchasing homes, accounting for about a quarter of the drop in home-ownership rates in this demographic from 2005 to 2014
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From 2007 to 2009, households with student loans saw 12.4 percent of their total net worth evaporate, while the net worth of those without such loans fell by 9.3 percent