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Majority of borrowers say federal student loan debt is not worth it


Nearly one third of undergraduates borrow money from the federal government to pay for college.This is a shocking sum of approximately 43 million Americans that owe an incredible total nearly $1.6 trillion in outstanding student loans.

New research found 54% of federal student loan borrowers thought it was unnecessary to take on the debt. The CNBC + Acorns survey found that 44% thought it was worthwhile to take on the debt. Invest in you Momentive has partnered to conduct a Student Loan Survey. (The poll was completed online between Jan. 10-13 with a nationwide sample of 5,162 adults.

Many Gen Xers and millennials are more cautious. Respondents aged 35-44 said that it wasn’t worth taking out federal student loans, given their circumstances. 

Borrowers of federal student loans average $36,510.

Kate Bernyk is 39 years old and graduated graduate school with two communication degrees, about $100,000 of student debt, and almost fifteen years ago.

Kate Bernyk is 39 years old and graduated with two communications degrees. She also owes about $100,000.

CNBC | Andy Tenke

Bernyk is a senior communications specialist based in New York. “I used be proud of my master’s degree. But now, it feels foolish.” “It feels like maybe I shouldn’t have gone because it’s really hard to put a price on what  the advantage has been versus the disadvantage of getting into debt.”

Her student loan balance is still over $30,000 

Earning a bachelor’s degree is a good thing. a median of $2.8 million during their career — 75% more than if they had only a high school diploma — although when broken down by gender, women with a BA have median lifetime earnings of $2.4 million, compared to $3.3 million for men.

End of loan repayment suspension

When the Covid-19 pandemic struck in March 2020, federal loan payments were suspended for borrowers. The relief granted in March 2020 by the Covid-19 pandemic was five times extended and now expires on May 5. According to the survey, many borrowers have been able to borrow more money in order pay their debts (48%) or for day-to-day expenses (35%).

However, borrowers who were surveyed stated that they will have to defer other financial goals such as investing in money (40%) and saving for retirement (38%), when their federal loan payments resume. 

Source: CNBC + Acorns Investment in You Student Loan Survey. Momentive

Each dollar that they borrow will cost them 2 dollars when they are done repaying the debt. They do not think about it.

Mark Kantrowitz

Financial aid expert

Biden supported a plan to cancel $10,000 student loan debt. Some Democratic lawmakers including Senator Elizabeth Warren, D.Mass. and Majority leader Charles Schumer D.N.Y. are calling upon the President to cancel student loans up to $50,000.

Rep. Virginia Foxx (R-N.C.), the House Education and Labor Committee’s top Republican, stated that blanket loan forgiveness was a “massive error”. — and the extension of the student loan pause has already cost taxpayers over $150 billion.

Too many things to think about