Experiencing Debt

How do minoritized students experience debt?

Student loan debt is a national issue but experiences in accumulating and paying it off are not universal. Minoritized students often need to take on student loan debt in order to pay their way through school. Research shows that Black students must borrow more than other groups to afford their education and struggle the most with repayment.

Minoritized students often need to take on student loan debt in order to pay their way through school. Black students borrow the most and struggle the most with repayment. Black borrowers owe an average of $25,000 more than White borrowers.

What are the racial differences in debt?

Black students have the most debt 12 months after graduation. When broken down by both race and gender, Black women have the most debt in both graduate and undergraduate degrees, followed by women of more than one race, then Black men. Latina women have the next greatest amount of undergraduate school debt while Native American or Indigenous Alaskan men have the next greatest amount of graduate school debt. Asian men and women have the least debt, followed by White men. Black students attend graduate schools like medical school in smaller numbers than those of other races, and have higher debt.

22% of White students who attend graduate school accumulate debt, compared to 44% of Black borrowers. 66% of White students take on debt, compared to 75% of Black students. Four years after graduation 48% of Black borrowers and 17% of White borrowers owed more than they originally borrowed.

Why are Black women more likely to have debt?

To set the stage, Black women have the greatest participation in the labor force when compared to any other group of women, along with the highest participation for mothers. However Black women also experience the highest levels of unemployment when compared to any other group of women, due to their greater overall involvement in employment.

Although women are more likely to enroll in higher education than men, Black women are less likely to do so. Black women leave school with more student loan debt and take longer to pay it off, partially due to a combination of the gender and racial pay gap. This disparity is similar for Latina women. 

How do minoritized families experience student debt?

Black and Latine families have little college savings for their children. Student loan debt also burdens families, particularly the parents of both students and graduates of color. Parent PLUS loans help illustrate the burden on families. On average, Asian women’s parents borrow the most at $40,358, which suggests that Asian students have lower loan debt because their parents take out loans on their behalf. Following the parents of Asian women, the parents of Black men take out $38,231 in Parent PLUS loans, on average. The parents of Black women, Latino men, and multiracial students have the lowest averages in Parent PLUS loans. This suggests that Black women, Latino men, and multiracial students largely take on their burden of paying for school themselves.