For many in Delaware, student debt is a fact of life

DOVER — Collectively, Americans owe about $1.5 trillion in student loans, a staggering sum that amounts to around $30,000 or so for each of the millions of individuals who took on debt to attend college.

It’s been called a crisis, one of the key reasons many men and women, particularly Millennials, are struggling to start a family and buy a house, rites of passage of adulthood for generations.

In Delaware, that debt appears especially severe. According to the Institute for College Access and Success, the average member of the University of Delaware’s class of 2018 owes $34,144 in student loans. That ranks ahead of only four states, all of which are located in the Northeast.

Per the Institute for College Access and Success, 62 percent of graduates of the First State’s flagship university have student debt.

While the organization notes the dataset is not perfect — information for some schools, such as Delaware State University and Wesley College, is missing, as is the effect of private loans — it paints a picture with potentially disturbing long-term consequences for Delaware.

“My generation is just going to be broke because we can’t do anything. We can’t buy anything because we’re paying student loans,” said Jakeisha Stanton, who graduated from Delaware Technical Community College in May after attending Neumann University for two years.

With so many individuals going deep into debt to attend college — about 45 million nationwide, according to oft-repeated estimates — some politicians are voicing support for forgiving loans in some fashion.

Sen. Elizabeth Warren of Massachusetts, one of the leading Democratic presidential candidates, for instance, wants to establish a wealth tax on Americans worth more than $50 million, using that to completely wipe out debt for 75 percent of borrowers. Sen. Kamala Harris of California, another contender, has proposed erasing up to $20,000 in debt for individuals who start businesses in disadvantaged communities.

While some see the issue as exaggerated, another data point against the Millennial generation, it’s all too real for many Americans. To them, student debt is an anchor weighing them down, a seemingly inescapable financial burden that could take decades to pay off.

Take Ms. Stanton. The 26-year-old still lives with her parents and wants to move out but said she is worried she will be unable to find a good-paying job that will cover her loans, rent and other expenses.

Growing up, she envisioned the American Dream the way so many others did: going to college, getting a job and buying a house, but reality has been different so far.

Ms. Stanton speculated that she may only be able to afford a tiny house, which she might be able to buy for around $30,000. While she laughed as she said it, the debt issue is far from a joke for her.

Bryan Townsend can attest to that. A state senator from the Newark area, the 38-year-old and his wife, Lilianna, both have solid jobs as lawyers but are still plagued by the reality of the debt they carry.

Because both of them went to law school, the couple currently has about $215,000 combined in student debt, he said.

“You look at your balance sheet and you think to yourself it is going to take the entire lifetime to become neutral,” Sen. Townsend said.

It can be “economically paralyzing,” he said, recalling checking what he owed practically every day while in law school.

To save money, he lived with his parents into his 30s, even when running for state Senate. A few decades ago, such a decision may have seemed odd, but it’s becoming more common in the 21st century.

While the Townsends are in a position where they can afford to pay off their loans and still have a roof over their heads and food on the table, Sen. Townsend acknowledges many others are not so fortunate.

Individuals who take on loans to attend college and then do not finish for whatever reason find themselves with the worst of both worlds — student debt and no degree to show for it.

“A huge swath of the economy,” Sen. Townsend said, consists of jobs that basically require a college degree and yet do not pay particularly well.

“You’re going to have to have a whole bunch of loans to try to unlock the doors of opportunity,” he lamented.

Ms. Stanton urged Delawareans to consider attending DelTech, UD or DSU, which are generally much cheaper than out-of-state schools.

UD and DSU

In recent years, the University of Delaware has placed increased emphasis on helping Delawareans attend. Many universities — especially state institutions — provide cheaper tuition for in-state students, and UD is no exception.

In-state tuition and fees for the 2018-2019 school year total $13,680, up from $8,646 a decade earlier. But for those coming from another state or country, the cost is $34,310, a hike of $13,184.

Board charges for the school year that begins this week are $5,064, compared to $3,350 10 years ago. Room costs come to $7,798, an increase from $5,128 in 2008-2009.

All of those represent an increase of more than 50 percent.

At Delaware State University, in-state tuition totals $8,258, while out-of-state students pay $17,294 to receive an education. Students also have a $754 health fee (those who already have insurance can opt out of it, however), a meal charge of at least $3,836 and housing costs that range from $6,976 to $12,768 per year.

“No wonder it costs so much. You’re basically signing up for four years of a combination academic effort, gym membership and sort of community club,” Sen. Townsend said, speaking generally of college life.

According to University of Delaware spokeswoman Andrea Boyle Tippett, the average in-state student actually pays about $7,600 in tuition thanks to financial aid.

“Many students graduate without any debt. For those Delawareans who do take on loans, the average debt is $24,600,” she wrote in an email. “Nationally, the average is $4,000 more ($28,600).

“UD is absolutely committed to making education affordable to our in-state residents. Over the past decade, we have doubled the amount of financial aid we provide to Delaware residents, even as our state funding for scholarships has remained flat.”

Of the 4,125 members of the undergraduate class of 2018, the university has “reasonable and verifiable information” on 3,416 of them. Based on those 3,416 individuals, UD estimates about 96 percent are employed or seeking another degree. According to a survey of 868 graduates from 2018, the average member of that class makes $53,440.

Delaware has taken some steps to assist individuals saddled with college debt, such as establishing a program to forgive up to $2,000 in loans per year for teachers in certain schools or subjects. The state has also expanded the scholarship programs intended to help Delawareans afford to attend DelTech, UD or DSU.

A spokeswoman for Gov. John Carney wrote in an email the governor “takes the student debt crisis very seriously” but noted much of the problem is too big to be solved by Delaware alone.

Sen. Townsend said he believes the issue needs to be viewed as a crisis, and he hopes to examine what other states are doing to find practices Delaware can adopt.

It’s a “fundamental economic commitment” made relatively early in life, at a point where many teenagers do not fully understand the long-term consequences, he said.

Ms. Stanton has similar sentiments.

“Once you get older and you get wiser, you understand that it’s a lot more than you thought it was at 18,” she said.

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