Learn Who's Affected By Rising Student Debt

A recent study found that 19 percent of households owed student loan debt in 2010.

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If you're up on student debt news, you may have already heard that one in five households owed student debt in 2010—a new record. As noted in a recent Pew Research Center report, "[s]ince 2007, the incidence of student debt has increased in nearly every demographic and economic category, as has the size of that debt."

The Student Loan Ranger is going to focus on the greater context of student debt expansion, and what it means for you.

To the Student Loan Ranger, the fact that one in five households now owe student debt is staggering. But what's really troubling is the rapid growth of that debt. It is more than double what it was in 1989, when fewer than one in 10 households owed student debt. And a significant percentage of the increase occurred in only three years, from 2007 to 2010.

[Read more about rising student loan debt.]

Did we mention we owe more now? According to Pew, the average amount owed by those who owed in 2010 was almost triple than 1989, rising from $9,634 to $26,682. Given what we know about the effects of delinquency and default, and the way student debt affects other aspects of life, that's pretty troubling, too.

So who is affected by this soaring debt? Who owes it? Is it—or will it be—you? With a number like one in five, the answer is likely yes. Let's take a closer look at how this debt affects us.

Households headed by someone under 35 are most likely to owe student debt: a whopping 40 percent in 2010. And student debt was 15 percent of all the debt they owed.

If you're in the next age range, you're still pretty likely to owe debt. Twenty-six percent of households headed by someone ages 35-44 owed student debt. That's more than one in four.

While the percentages are lower for households headed by someone ages 45-54, 55-64, and 65 and older, the portion of student debt holders in 2010 in these groups was all more than double the 1989 amount.

[Find out how to prepare for student loan repayment.]

Almost everyone is more likely now to have student debt than they were a few years ago. But perhaps a more relevant (and sobering) question is: Can we all afford to bear this burden?

The burden is greatest for those who have the least ability to pay. Pew found that those in the lowest fifth of households by income owed 24 percent of their income in student debt—almost a quarter for every dollar they made. (They made less than $21,044 annually.) On the flip side, those in the top tenth owed only 2 cents per dollar. (They made $146,792 or more annually.)

What if you're in the middle? Households making $36,724-$59,623 owed 12 percent of their income in student debt; 12 cents of every dollar was student debt.

[Consider two new ways to pay back student loans.]

The takeaway here: Everyone is more likely to have debt, and the burden will be heavier for most, eating up a greater portion of income. While the Student Loan Ranger believes we need policy solutions, we need to be proactive in the meantime. Be realistic about the likelihood you'll have debt, and face the reality this burden will have on your future.

This doesn't mean avoid college (we've written about the value of a college degree). But minimize borrowing and ensure access to important borrower protections (available on federal loans) like deferment, forbearance, and income-driven repayment plans that help prevent default.

To learn more about how income-driven plans work, download our free manual and register for one of our free student debt webinars. Follow us on Twitter (use #studentdebthelp) and like us on Facebook for updates and tips on student debt and relief programs.

Radhika Singh Miller is a program manager for Educational Debt Relief and Outreach at Equal Justice Works. She has served on student loan committees in the Department of Education's negotiated rulemaking focusing on the College Cost Reduction and Access Act (CCRAA) and other debt relief initiatives. Radhika graduated from Loyola Law School Los Angeles. Prior to joining Equal Justice Works, she was a staff attorney at the Partnership for Civil Justice, focusing on constitutional and civil rights litigation and advocacy.