College debt is a major consideration for today’s graduates and HBCU graduates are no exception.
This issue of college debt has been so important that almost every Democratic candidate for President in 2020 talked about it on the campaign trail. Both Senator Kamala Harris, the current candidate for Vice President, and Elizabeth Warren made bold statements about making investments in HBCUs. They both also talked a lot about the Black college debt burden. Senator Harris, herself a graduate of Howard University, proposed capping student debt interest payment at 3.5%. On the other hand, Senator Warren proposed a $50 billion investment into Black college institutions.
This extra attention on Black college debt makes a lot of sense since, although college debt is high across the board, graduates who are Black and Hispanic, have disproportionately higher college debt balances.
Below we share some statistics to help drive this attention on black college debt. We also list some resources to learn more and think strategically about how graduates can manage college debt.
Statistics on Black College Debt
1) 86.8% of black students borrow federal student loans to attend 4-year public colleges, as opposed to 59.9% of white students. (Source – National Center for Education Statistics (NCES))
2) Americans (4 million of them) owe over $1.48 trillion in student loan debts. (Source – National Center for Education Statistics (NCES))
3) Black students borrow federal student loans at higher rates than other groups of students. (Source – National Center for Education Statistics (NCES))
4) An estimated 77.7% of black students borrow federal student loans to pay for a higher education. This figure is significantly higher than the national average for all students (60%) and for white students (57.5%). (Source – National Center for Education Statistics (NCES))
5) Among black students who started school in 2003, 50% defaulted on student loans within the following 12 years. For Hispanics it was 36.1% and whites it was 21.5% of students. (Source – National Center for Education Statistics (NCES))
6) When race is factored in, black college graduates owe — on average — $7,400 more than their white peers, and that number is expected to more than triple to $25,000 in the next few years. (Source: Brookings Institute)
7) A 2016 also found that a higher percentage of students at HBCUs — 80 percent — used federal loans to pay for college compared to 55 percent of students not attending an HBCU. (Source: United Negro College Fund (UNCF) report)
8) It also found that a higher percentage of students — 12 percent — at HBCUs combine federal, state and private loans to finance their education, compared to 8 percent of non-HBCU students. (Source: United Negro College Fund (UNCF) report)
Managing Debt for Black Graduates
The team at U.S. News & World Report recently created a series guide that breakdowns the different types of student loans and available repayment options, how they work and what students should know before considering them. They have shared the research with us and we are sharing those links here to help you manage your student loan debt!
- Hundreds of companies are now paying off their students’ student loans
- The dark side of job sponsored student loan payments
- Employer student loan repayment with Discover
- IRS ruling allows company to match student loan payments into their 401K
- Sallie Mae
- The College Investor
- Private student loans (US News Research)
- Loan consolidation (US News Research)