Welcome to Ohio, where the average student debt is $28,947, according to a new study by LendEDU, an online student loans marketplace. Ohio's average student loan debt is smack dab in the middle of the state-by-state rankings, with average student debt ranging from $19,742 in Utah to $38,776 in Connecticut.
About 58 percent of all students graduating from a four-year college or university in Ohio and the U.S. received a student loan to finance their education. The rise in college loan debt stems from the ballooning cost of tuition. In Ohio, as in other states, colleges have been forced to increase tuition to cover funding gaps created by cuts in state subsidies.
Ohio was one of many states in which public investment in colleges and universities decreased in 2018. A report from Moody's Investors Service pointed to a number of factors.
"Higher education remains the largest discretionary component of many state budgets, and therefore is vulnerable to reductions as states prioritize their spending and continue to tackle post-retirement benefit obligations," the report said.
With student debt on the rise, many young people are putting off buying a home, a reliable car and even getting married and having children.
According to the Federal Reserve, one of every five student borrowers is behind in payments.
About 60 percent of recent graduates have less than $1,000 in their bank accounts, largely because of student loans, according to Student Debt Crisis, a nonprofit group that supports making college free.
Generally, students rack up higher debt at private colleges because tuition is more costly.
In Ohio, students graduating from the Cleveland Institute of Art have the highest average college debt per borrower at $41,326, according to LoanEDU. Fully 96 percent of students who graduate from CIA do so with student debt. Marietta College ranks second with an average debt of $40,196. Tiffin University ranks third at $38,036.
Among public colleges, student debt was highest at Kent State University, with student debt at about $33,800.
Wright State University – Lake Campus, a satellite of Greater Dayton's Wright State, has the lowest average student debt per borrower at $21,808. Cleveland State University is ranked 17th lowest in the state, with an average debt of $29,938.
About 44 million Americans owe a staggering $1.5 trillion in student debt, surpassing credit card and auto loan debt, according to the U.S. Department of Education. Outstanding student debt has nearly tripled in the past decade.
As of 2016, Ohio ranked first overall with the highest average student loan debt per capita at $5,700, according to Forbes. Pennsylvania ($5,690) and New York ($5,570) rounded out the top three. The national average student loan debt per capita is $4,920.
For many graduates, student loans are becoming unmanageable. The average monthly student loan payment is nearly $400, and in Ohio many borrowers have payments that are more than 60 or 90 days past due.
By 2023, nearly 40 percent of student borrowers are expected to default on their college loans. Loans generally go into default after roughly a year of nonpayment, wrecking people's credit scores.
According to a Pew Research Center survey, 22 percent of college graduates with student debt said they're either financially struggling or "just getting by," compared to 11 percent of graduates who had no college debt.