Minority Students Have More Student Loan Debt
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UPDATED: Nov 2, 2012
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A recent report has found that 40 percent of Latinos borrowed student loans compared to 43 percent of non-Hispanic whites and 51 percent of non-Hispanic blacks. These students contributed to the mounting $1 trillion student debt with the loans they borrowed.
The report came from the Campus Progress and Center for American Progress and highlights how minorities are disproportionately affected by student debt.
Data in the report shows that 27 percent of non-Hispanic black students that had bachelor degrees owed over $30,000 in debt compared to 16 percent of non-Hispanic white students that borrowed more than $30,000 in student loans.
Latinos with bachelor degrees increased 80 percent between 2001 and 2011. However, non-Hispanic white bachelor degree earners over the age of 25 exceeded Latinos by 20 percent.
The report found that 69 percent of non-Hispanic black students noted that student debt was their main reason for dropping out of college compared to 43 percent of non-Hispanic whites that also dropped out. 74 percent of Hispanics simply refused higher education due to the financial costs involved. 81 percent of non-Hispanic black students and 67 percent of Hispanic students left school with higher debt compared to non-Hispanic white classmates.
Campus Progress believes the data shows that minority college students borrow more student loans on average when compared to their non-Hispanic white classmates. As a result, overwhelming levels of student loan debt often force minority students to accept lower-paying jobs than they normally would.
A significant amount of debt also means new graduates are less likely to spend more. This negatively impacts the economy in the long run since more money is spent on paying off debt rather than making purchases on cars, homes, and consumer goods.
In order to help turn the tide against the rising cost of higher education, experts recommend that new students use a combination of federal student loans or grants, such as Pell Grants, and self-payment plans. Young student borrowers should also be walked through the borrowing process so that they are fully aware of the responsibilities and obligations that come with student debt after graduation.