Degrees of Debt. Student Borrowing and Loan Repayment of Bachelor's Degree Recipients 1 Year after Graduating: 1994, 2001, and 2009. Stats in Brief. NCES 2014-011
Author: Woo, Jennie H.
Date: 2013-10-00
Type: Numerical/Quantitative Data
Subjects: Student Loan Programs,Debt (Financial),Loan Repayment,Paying for College,Graduate Study,Undergraduate Students,Bachelors Degrees,Cohort Analysis,Longitudinal Studies,Interviews,Statistical Analysis,Statistical Distributions,Statistical Surveys,Predictor Variables,Cost Indexes,Educational Benefits,Socioeconomic Status,Sociocultural Patterns,College Outcomes Assessment,Academic Aspiration,Income Contingent Loans,Student Financial Aid,Enrollment Trends,Grants

This Statistics in Brief examines three cohorts of recent college graduates 1 year after they attained their bachelor's degree. The graduation years for the three cohorts span a 15-year period: 1992-93, 1999-2000, and 2007-08. The latest cohort (2007-08) graduated in the midst of the 2008 recession. This Statistics in Brief first examines how borrowing for under-graduate education and graduates' cumulative debt changed over the three cohorts and then compares graduates' debt burden (ability to repay loans based on  employment income) 1 year after graduation (1994, 2001, and 2009). Finally, for each of the cohorts, the analysis examines the relationship between level of debt and students' post-graduate activities in terms of graduate school enrollment and living arrangements (with parents or not). The data for this study were collected through three administrations of the Baccalaureate and Beyond Longitudinal Study (B&amp;B), which follows bachelor's degree recipients identified in the National Postsecondary Student Aid Study (NPSAS). NPSAS collects data on a sample of graduate and undergraduate students who represent all students enrolled at institutions eligible to participate in federal financial aid programs under Title IV of the Higher Education Act (sometimes referred to as &quot;Title IV Institutions&quot;). In addition to their base year NPSAS interview, bachelor's degree recipients in each B&amp;B cohort (1992-93, 1999-2000, and 2007-08) completed a follow-up interview 1 year after graduating (as of 1994, 2001, and 2009). This Brief analyzes data from both base-year and first follow-up interviews. Study questions include: (1) Among recent college graduates, how did the percentage who borrowed to pay for undergraduate education and their cumulative debt change across the three cohorts? (2) Among bachelor's degree recipients who borrowed, what percentage were repaying student loans 1 year after graduation? (3) Within each cohort, how did students' level of debt vary with their subsequent enrollment in graduate education and living arrangements with their parents 1 year after graduation? Key findings include: (1)The percentage of recent college graduates who borrowed for their undergraduate education was higher in each successive cohort  (49,64, and 66 percent, respectively, among graduates in 1992-93,1999-2000, and 2007-08) though the difference between the first two cohorts was greater than the difference between the middle and latest cohort. Likewise, the average cumulative debt (in Constant 2009 dollars from all sources increased in each successive cohort, from $15,000 to $22,400 to $24,700. (2) In all three cohorts, the rate of borrowing was highest among students at for-profit institutions (7-to 90 percent), (3) Among students at public and private nonprofit institutions, the most frequent borrowers were lower income dependent students at private nonprofit institutions (70 to 80 percent borrowed) for all three cohorts. (4) Proportionately fewer borrowers in the latest cohort (2009) were in repayment 1 year after graduation than were their counterparts in 1994 and 2001(60 vs. 65 and 66 percent, respectively). (5) Also in 2009, a larger percentage, (31 percent) of graduates in repayment faced high monthly loan payments (greater than 12 percent of their monthly income), than their  counterparts in 1994 and 2001 (22 and 18 percent, respectively).(6) Levels of student debt were not consistently associated with students' subsequent graduate school enrollment or living arrangements with parents 1 year after graduation. Instead both experiences varied with cohort year; graduate school enrollment was highest in 2009 (the year after the economic recession began),and moving back home to live with parents (among students age 24 or younger) was higher in both 1994, and 2009 (27 percent) than in 2001 (18 percent). (Contains 3 tables, 10 figures, and 15 footnotes.) [This report was prepared for the National Center for Education Statistics under Contract No. ED-07-CO-0104 with RTI International.]