Janice Lozano
Student loan debt is a significant issue for many college graduates in the US, with the average total debt, including federal and private loans, jumping by over $8,700 between 2008 and 2017. While the average amount borrowed has since stabilized, the average monthly student loan payment is estimated to be $536, with an average outstanding federal student loan debt per borrower of $38,375. The monthly payment amount varies based on income, total debt, interest rate, and repayment timeline. The standard repayment plan is 10 years or less, but 42% of borrowers are still paying off their loans 20 years later. The type of degree and institution also impact debt, with graduates from private, for-profit institutions incurring the highest average debt.
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What You'll Learn
Average monthly payments
The average monthly student loan payment is estimated to be $536, based on previously recorded average payments and median salaries of college graduates. This figure is equivalent to 10% of a $62,760 annual gross income (GI). The average borrower takes more than 20 years to repay their student loan debt, with 42.9% of borrowers on a standard 10-year or less plan with fixed payments. The average outstanding federal student loan debt per borrower is $38,375, with 52.4% of indebted borrowers owing $20,000 or less.
The monthly payment amount varies depending on multiple variables, including income, total debt, interest rate, and repayment timeline. According to the 50-20-30 rule of finance, 20% of gross income (GI) should be allocated towards debt repayment. The average monthly payment among student loan holders is between $200 and $299, with university graduates owing an average of $28,244 annually after leaving school.
The type of degree and institution attended also impact debt levels. For example, the average student debt for a federal loan borrower who graduated from a public institution with a Bachelor's degree is $23,390, while this figure increases to $26,720 for graduates from private, nonprofit institutions. Graduate school debt can be even higher, with the average debt for a master's degree from a private nonprofit institution being $63,850.
Additionally, gender and racial disparities exist in student loan debt. According to data, 64% of student loan debt is held by women, with Black women carrying the highest average debt amount. Women also pay back their loans at a lower monthly amount than men.
It's important to note that these figures represent averages, and individual loan payments and debt levels can vary significantly depending on a range of factors.
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Average total debt
The average total student loan debt varies depending on the type of degree, the level of the degree, and the institution where the degree is earned. The average total student loan debt, which includes both federal and private loans, jumped more than $8,700 from 2008 to 2017. However, in recent years, the average amount borrowed has stabilized.
For a bachelor's degree, the average debt is around $30,000. This amount can vary depending on the type of institution attended. For example, federal loan borrowers who graduated from public institutions with a bachelor's degree had an average student debt of $23,390, while those who graduated from private nonprofit institutions had an average debt of $26,720. The average debt for those who graduated from private for-profit institutions was $34,740.
For graduate degrees, the average debt can be much higher. The average student loan debt for all graduate school borrowers is $77,300, not including undergraduate loans. The type of graduate school also affects indebtedness. For example, a master's degree from a public school can result in an average debt of $44,410, while a master's degree from a private nonprofit institution can increase this amount to $63,850. According to the National Center for Education Statistics, the average student loan debt for graduate school is about $88,220.
It's worth noting that the average monthly student loan payment is estimated to be $523 to $536, and it takes borrowers more than 20 years on average to repay their student loan debt. Additionally, the interest rate for Direct Subsidized and Unsubsidized federal student loans is 6.53%, which can impact the total amount repaid over time.
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Average debt by degree type
The average student loan debt for all degree types exceeded $39,000 as of 2025. The average federal student loan debt is $39,075 per borrower, while the average total student loan debt, including private loan debt, may be as high as $42,673. The average monthly student loan payment is $536, and it takes borrowers more than 20 years to repay their student loan debt.
Bachelor's Degree
The average student borrows over $30,000 to pursue a bachelor's degree. The average student loan debt varies depending on the type of institution attended. Students who attended a private, for-profit institution with a bachelor's degree have an average student debt of $34,740 for federal loan borrowers. For federal loan borrowers who graduated from a private, nonprofit institution, the average student debt is $26,720. The average student debt for federal loan borrowers who graduated from a public institution with a bachelor's degree is $23,390.
Associate's Degree
Associate's degree holders are the most likely to pay off their student loans faster than other degree holders. 31% of associate degree holders who graduated from public institutions use student loans to pay for school, compared to 77% of attendees of private, nonprofit schools and 91% of attendees of private, for-profit schools. The average student debt for a federal loan borrower who graduated from a public institution with an associate's degree is $14,890. For those who graduated from a private, nonprofit institution, the average student debt is $25,770.
Master's Degree
Borrowers who hold master's degrees owe an average of $69,140 each.
Law School
The average law school debt is approximately $140,000.
Medical School
The average medical school debt is approximately $200,000.
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Average debt by race and gender
The average student loan debt in the US varies significantly by race and gender. Black borrowers consistently have the highest debt levels, and Black women are the most indebted demographic, owing an average of $41,466.05 in undergraduate student loans. This is over $20,000 more than white men, who borrow the least on average.
Several factors contribute to these disparities. Firstly, family wealth plays a significant role. Affluent families may choose to finance their child's education, while those struggling financially often cannot afford to contribute, resulting in their children taking on more substantial student loans. Additionally, recent graduates from low-income families may need to financially support their families, diverting funds from loan payments.
Income differences are another critical factor. Students and families with lower incomes will have less money to pay for college, leading to more borrowing and larger loan balances. Moreover, higher incomes after graduation make it easier to repay loans, while lower incomes make repayment more challenging. Black borrowers face a racial wage gap, making it more difficult for them to repay their loans.
The type of degree pursued also impacts debt levels. Borrowers obtaining master's or doctorate degrees typically have more student loan debt. Additionally, certain degrees, such as those in STEM fields, may lead to higher salaries, making it easier to repay loans.
Other factors, such as career distribution and local cost of living, also influence debt levels. For example, if more members of a particular group work in high-paying industries, they will likely find it easier to manage their loan payments.
While loan forgiveness and income-driven repayment plans can help manage debt, racial disparities in student debt burdens persist and contribute to a broader racial wealth gap. Black borrowers are more likely to face financial consequences due to their student debt, delaying important financial milestones.
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Average time to repay
The ideal timeline for paying off student loan debt is 10 years, according to financial experts and the U.S. Department of Education. However, the average borrower takes more than 20 years to repay their student loan debt. 42.9% of borrowers are on the standard 10-year plan with fixed payments, while 5.7% of borrowers are on a plan to pay off their loans over more than 10 years with fixed payments. 2.2% are on a plan to pay over more than 10 years with graduated payments, and 24.3% are on the SAVE payment plan, which is based on a percentage of the borrower's income.
The time it takes to repay student loans varies depending on several factors, including the initial amount borrowed, the loan's interest rate, and repayment habits. The average monthly student loan payment is estimated to be $536, but this can range from $200 to $299 for federal borrowers owing less than $20,000. The interest rate for student loans is currently at a historic high of 6.53%, which makes it challenging for borrowers to adhere to the recommended 10-year repayment timeline.
Additionally, the type of degree earned can impact the repayment timeline. For example, student borrowers with Associate's degrees are more likely to pay off their loans faster than other degree holders. In contrast, the average medical school graduate's salary may not be sufficient to make their student loan payments, and some professional graduates take over 45 years to repay their loans.
It's worth noting that longer repayment terms can lower monthly payments but often result in paying more interest over time. Therefore, it's essential for borrowers to carefully consider their repayment strategies and seek options that best align with their financial goals and capabilities.
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Frequently asked questions
The average monthly student loan payment is $536, based on previously recorded average payments and median salaries among college graduates.
The average total student loan debt, including federal and private loans, is $28,244 per year after leaving school.
42.9% of borrowers are on a standard 10-year plan, but the average borrower takes more than 20 years to repay their student loan debt.
The average student loan debt for a graduate degree is between $44,410 and $88,220, depending on the type of graduate school and degree.
Yes, there are differences in student loan debt between different demographic groups. For example, 64% of student loan debt belongs to women, with Black women having the highest average amount of debt.
