Eighty percent of Americans want the federal government to make it easier to repay student loans.
This statistic is from a new study from the Pew Charitable Trusts. It conducted a telephone poll this past August, interviewing more than 1,000 people about their opinions on student loans.
It’s important to note, the study only referred to federal student loans and not any additional personal loan or line of credit students may take out.
Many students searching out the answer to what is a personal line of credit know they may have to supplement student loans when their financing falls short. But Pew turns its spotlight away from these personal products to shine a light on the student debt crisis.
Now a record $1.6 trillion, the debt crises has gotten its fair share of ink at the nation’s biggest online news outlets — from the New York Times and the Washington Post to CBS News and CNN. It even hogs much of talking points in the 2020 Democratic debates unfolding this fall.
And now, thanks to Pew, the average American can share their opinion, too. As it turns out, the country has a complicated relationship with student debt.
Repaying Loans is a Challenge
Although it’s possible to strike debt clean from your record, most people recognize it’s not the easiest thing to do.
A whopping 89 percent of respondents said they agree borrowers have a hard time paying back their student loans.
The average graduate owes roughly $30,000, which puts the average monthly payment of a standard repayment plan somewhere between $304 and $333.
Picking away at debt in these sized installments means it will take you roughly 10 years to pay off what you owe.
Of course, this $300 is on top of any personal line of credit payment, rent, and utilities you may have.
A decade of balancing your books this way may be a hardship. And for some 7 million borrowers in default, it’s impossible.
Student Loans Are a Drain on the Economy.
Pew reports 69 percent of respondents agree that borrowers who struggle to repay their debt have a greater impact on the economy.
And they have good reason to believe this.
More than 45 million people shoulder a collective $1.6 trillion debt load. This means nearly a little over 13 percent of the population share a significant financial burden.
If they aren’t in default, they’re funneling a lot of each paycheck into their monthly repayments, along with other bills that keep their household running.
Basic things like covering rent, a line of credit balance, and utilities become the priority
Less dire spending, like unnecessary yet fun services and products that help boost the economy, are put on the backburner.
They’re also postponing major milestones that may have a greater impact on the economy later on. Unlike generations before them, millennials are waiting to start a family, putting off homeownership, and failing to save up for retirement.
Federal Government Needs to Step Up
It may come as no surprise then that many of the those surveyed — or 58 percent — strongly agree the federal government needs to take action. They believe the government should make it easier to pay off student debt.
What Does Federal Action Look Like?
What the poll fails to make clear is how these survey participants expect the government to address this problem.
Is it something like Bernie Sander’s plan to cancel all $1.6 trillion of debt by taxing the top 0.1 percent of Americans?
Or is it something closer to Elizabeth Warren’s sliding scale of relief, which promises to forgive up to $50,000 of debt for those households earning less than $100,000?
Or perhaps, it involves much less progressive proposals, like Joe Biden’s bid for income-driven repayment plans or Julio Castro’s time-based forgiveness.
The answer to this question may have to wait until July 2020, when the Democratic Presidential Nominee takes the stage at the National Convention.
And of course, let’s not forget the results of the November election, when the country chooses between another Trump government and a fresh start.
While the Democrats debate canceling the debt, the GOP has moved in the other direction. During Trump’s presidency, his administration has loosened restrictions on loans, put sharp limits on repayment options, and ended loan subsidies and forgiveness programs.
Next year proves a momentous year for the future of student loans and the economy. Time will tell how and if American concerns over the debt crisis will impact how they mark their ballots.
However they vote, Pew proves that student loan debt and the repayment system weighs heavily on the minds of most Americans. If it does the same to yours, vote carefully. Find where the nearest polling station is to campus, and make sure you’re registered.