Nearly one-in-five American households now have student loan debt, according to a study released by the Pew Research Center. Overall, 19 percent of households carried some amount of student debt in 2010, up from just 15 percent in 2007. Borrowers on average owed more than $26,000, double what they owed in 1995.
Student loan debt has the largest impact on poor and middle class Americans, who devote large chunks of their household incomes to student debt. The poorest fifth, as this chart from CNNMoney shows, have student debt that amounts to roughly a quarter of their household income while the share is much lower for wealthier Americans:
The richest share of households, not surprisingly, is better able to handle the burden. College debt accounted for only 3.3% of their household income. But student loan debt ate up nearly a quarter of the earnings of the poorest fifth, the study found.
Total student loan debt is expected to pass $1 trillion in 2012, and that is impacting young students’ ability to make the same transition into the economy earlier generations made. An earlier report, in fact, found that the growing amount of student debt was playing a role in holding back the nation’s housing recovery.