About 300,000 people in Utah are pay off student loans, according to an analysis by the loan counseling site Student Loan Hero.
This debt can place a heavy burden on many people and wider economy, preventing some people from saving for retirement, buying a house and starting a family.
President Joe Biden plans to erase at least part of it with a map cancel $ 10,000 in loans to individuals across the country. If he can rally Congress or if he has legal authority to do so through an executive order, about 37% of Utah student loan borrowers would have all of their debt written off. This would be the second highest proportion of borrowers in the country, according to the analysis of Student Loan Hero.
“Absolutely, Utah is sort of on the lower end of the spectrum in terms of the impact of student debt,” said Andrew Pentis, the group’s loan adviser. “But that said, it is certainly not immune to the problem.”
Pentis said Utah borrowers owed less than the national average – $ 31,046 compared to $ 36,689 nationally – in part because of relatively affordable tuition fees at public colleges.
Yet the Utahns pay an average of $ 282 per month on their loans. This can be a huge burden on people, especially those from low-income families, he said.
“Maybe this doesn’t sound like a lot to other borrowers or those who are better off, but student loan debt can definitely weigh people down.” he said. Without that debt, “maybe they take their average savings from monthly payments and put food on the table, go fix their cars.”
However, experts are divided on the benefits universal student loan cancellation could have for the economy as a whole. Some claim it is not the most efficient use of taxpayer funds because people who go to college are generally better off than those who don’t and most are able to afford their monthly loan payments.
Others, like Marshall Steinbaum, a professor of commerce at the University of Utah and a finance researcher in higher education, say debt suppression could boost the economy by allowing people to spend that money on other things.
He said that with university becoming almost a necessity for finding a job these days, more and more people are going, including a growing percentage of diverse backgrounds and low-income families.
“The way I would phrase this is not to look at the population of people with student debt,” Steinbaum said. “Look at people who don’t have student debt. If you look at everyone who lives in the United States today who has no student loan debt, you will have older people who never went to college as well as younger people who were better off. loties and who went to college and didn’t have to go into debt to do so.
Having the loans canceled, Steinbaum said, will not solve the underlying problem of rising college costs. This will require a whole different set of political and political calculations.