Updated Jun 30, 2023 - Economy

Who owes the most in federal student loans

Data: Federal Student Aid; Chart: Simran Parwani/Axios

About 80% of people with outstanding federal student loan debt are under 50 years old — and are officially expected to be on the hook for payments following the Supreme Court decision to kill President Biden's forgiveness plan.

Why it matters: Experts have warned of a messy return to debt repayment for borrowers who collectively owe more than $1 trillion in student loans as the significant pandemic-era break comes to a close.

  • Biden's plan would have forgiven up to $10,000 for individual borrowers who make under $125,000 per year or $20,000 for Pell Grant recipients.

What's next: Student loan interests will resume starting Sept. 1, and payments are expected to be due starting in October.

  • Most borrowers will need to opt-in to confirm auto-debit payments.

By the numbers: Borrowers between 35 and 49 years old owe the most in federal student loans, according to Federal Student Aid data.

  • 24 or younger: More than 7 million people owe $103.40 billion
  • 25-34: More than 15 million people owe $497.48 billion
  • 35-49: More than 14 million people owe $635.65 billion
  • 50-61: More than 6 million people owe $297.37 billion
  • 62 and older: More than 2 million people owe $112.75 billion

Details: Women typically borrow more for college than men, according to NerdWallet, a personal finance company.

Black borrowers are disproportionately burdened by student loan debt. As of 2019, a typical Black student loan borrower will still owe 95% of loans 20 years after starting college, compared to 6% for a white borrower.

  • About 75% of borrowers took out loans to go to two- or four-year colleges, according to the Brookings Institute, a public policy organization. These borrowers' loans make up half of the outstanding debt.

Between the lines: With resuming student loan payments, people could now face delinquencies in credit card debts and personal loans.

  • The pandemic-related debt relief led to better "self-reported financial well-being" among adult borrowers, a May 2022 Federal Reserve System report said.
  • Students who attended college and didn't borrow or had already repaid debts did not report similar improvements, suggesting that improvement was caused by changes in student loan policy, the report said.

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