Student management

Student loan debt is now so high that women are forced to choose between paying off loans and starting families

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If US lawmakers ever decide to reform the student loan system to reduce the financial burden on borrowers, women have the most to gain because they are much more likely than men to be negatively affected by student debt. In some cases, women even have to choose between paying off their student loans or starting a family.

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About 45 million Americans owe a combined $1.7 trillion in federal and private student loans, MSNBC reported last week. About two-thirds of them are women.

Because of the gender wage gap, women on average have less money to spend on student debt than men. The situation for women of color is even worse because of pay gaps based on race or ethnicity. A recent CNBC and Momentive survey found that black and Hispanic women are twice as likely as their male counterparts to have student debt.

Women also tend to have higher student loan balances — an average of $31,276 compared to $29,270 for men, according to a 2021 study from the American Association of University Women. It doesn’t seem like a huge difference – until you factor in average salaries.

“As women graduate, their debt repayment collides with the gender wage gap and the racial wealth gap to make it harder for them to repay their loans,” the report said. ‘AUW. “Interest then accumulates, which further increases the debt burden.”

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Before the COVID-19 pandemic, women with a bachelor’s degree expected to earn an average of $35,338 in their first year out of college, about 81% of what men expected to earn. to win. The gap has likely widened during the pandemic, as a disproportionate number of women have had to leave the workforce or reduce their working hours to care for home-schooled children.

The AAUW study found that women spend an average of $920 per month on housing, $396 on car loans or leases, and $307 on student loans. For the 16% who are mothers, an extra $520 is spent each month on child care, leaving a monthly deficit of $372.

One consequence is that some women may have put off saving for retirement, buying a home, starting a business, or starting a family. Among the latter group is Tasha Kaminsky, 33, a director of development at a St. Louis nonprofit.

In a recent interview with MSNBC, Kaminsky said she would love to have kids, and she seems like a perfect fit: she’s happily married, has a steady job, and owns a house. But she still owes more than $100,000 in student debt from loans she took out a decade ago. Adding a child to the mix would make his financial situation almost untenable.

“We can either continue to live comfortably or live on a shoestring because of student loans,” Kaminsky told MSNBC.

The best outcome for borrowers like Kaminsky is for President Joe Biden to take action to forgive some or all federal student loans. It hasn’t happened yet. As it stands, the federal student loan suspension is set to expire on August 31, 2022.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who has previously held positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work has also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal, and Business North Carolina magazine. He holds a BA in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting has earned him awards from the North Carolina Press Association, Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A North Carolina native who also writes fiction, Vance’s short story “Saint Christopher” placed second in the 2019 Writer’s Digest short story competition. Two of her short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. Her first novel, Voodoo Hideaway, is published in 2021 by Atmosphere Press.