According to a recent Bloomberg analysis, average student loan debt is currently more than double the amount it was at the end of the recession in 2009. Case in point, according to that same analysis, as of this past November, outstanding student loan debt has set an all-time record at $1.5 trillion. I’ve seen some top contenders for “literally worst record ever,” but we might have a new champion here.
Despite the recession ending almost ten years ago, these new rounds of debt have shown the highest cumulative loss percentages since 2009. Many of those who took out loans in 2012 are currently between the ages of 24 and 33. Despite being fairly early in most of their professional careers, these people have to dedicate a sizable amount of their wages to paying back the loans. In just the third quarter of this year alone, borrowers owed $489 billion.
More than 2.7 million individuals owe more than $100,000 in debt, with 700,000 individuals owing more than $200,000. Even those aged 62 and up still owe money from student loans, with $62.5 billion owed from just that age group.
Many of these borrowers can barely put enough money together to both pay their debts and support themselves. As a result, they have little-to-no money to spend on themselves. This will not be beneficial to the economy in the event another recession rears its ugly head.