Learn How Student Loans Impact the Economy

Increased emphasis on social safety net initiatives 

Borrowers with student debts are more likely to require and utilize social safety net services such as Medicaid, SNAP, and others. Borrowers are thus more of a liability for the entire government rather than just themselves.   

Increased Probability of Delinquency

If you are experiencing financial difficulties, you may find yourself missing student loan payments or possibly defaulting on your debts. The repercussions of failing to pay student loans can have a significant influence on your credit score. This can make it more challenging to qualify for other loans, particularly mortgages. It can also make refinancing your debts to lessen your debt burden considerably more difficult.

Students have less economic power than adults.

Because student loans are so standard, students are finding it more difficult to graduate and begin earning enough to buy a house, marry, and start a family. They can’t afford to buy new cars or go on vacation as frequently.
Instead, they’re putting more money into loans than ever before.

Inequality Across Generations 

Generally, whether people are better off now than they were a generation ago is a good indicator of the economy. Student loan debt has surpassed inflation, making it more difficult for future generations to feel that way. Borrowers are not better off than they were a generation ago because education is expensive. 

Delays in Ordinary Life Events 

It’s a typical path: graduate from college, obtain a job, buy a house, marry, and have a family. Those life milestones, however, tend to arrive more slowly for student loan borrowers than for their peers who do not have student debt.