By Meche Kondo
In recent years, statistics prove that student loan debt in America is in the trillions, $1.7 trillion to be exact, a number that is inclusive of new pupils, recent graduates, and former students still biting away at debt years later.
Despite the educational status of students, one thing has become glaringly clear through research: Black people owe more money and have less financial means to pay it back. Taking this on as a national issue are people like Rep. Ayanna Pressley (D-Massachusetts), who is advocating canceling student loan debt to revitalize the economy.
“The average borrower has $30,000 worth of [student loan] debt, [canceling that] will jump-start the economy,” Pressley said in Yahoo Finance in 2020.
“Black student borrowers borrow and default more than anyone else because of our inability to build generational wealth. I see that as a racial justice issue,” the Congresswoman continued.
With Black people still fighting for basic human rights in this society, racial disparities are still prevalent in national topics. Student loan debt is not different. Black students have a harder time repaying their debts because they often find themselves having to take bigger loans because of a lack of resources, but end up making less than their White counterparts upon completing school. This reality makes the standard repayment period unrealistic. Thus, creating more debt through steadily increasing interest rates.
“The standard repayment timetable for federal loans is 10 years, but research suggests it actually takes four-year degree holders an average of 19.7 years to pay off their loans,” according to Nitro.com. However, when adding the unexpected curve that is COVID-19, relief of student loan debt is still an elusive fantasy in this changing environment.
While the pandemic has made it possible for the loanee to take a break from paying their loans, the truth is that this is a temporary fix, and the impending end to the forbearance is going to be problematic for many people if a resolution is not reached soon.
“Honestly, I don’t anticipate being able to pay my loans off completely,” said science teacher Adrienne Jones. “My interest rates have skyrocketed since I graduated eight years ago, and I intend to buy a home for my family by any means necessary. My student loan debt is the elephant in the room.”
With American society ever-changing and evolving, the student loan debt crisis is currently coming to a head, and while President Joe Biden has made it a priority to forgive $10,000 worth of debt, it’s going to take more than that to bridge the equity gap and financial disparity that Black people continue to experience in this country.
Further, with the majority of students who take loans being White and the majority of people who owe money being Black, loan debt has become another disparity for people of color to overcome in this country.
Research conducted for the Census shows that Black people in urban areas are less likely to make student loan payments on time and, as a result of their tardiness, often default. On the other hand, Black people who prioritize paying their loan debts are oftentimes unable to invest in their future.
“The average Black household has about one-thirteenth the wealth of the average White household. And if you view student loan debt as negative wealth, as money that could have been used to save for wealth or to purchase a home or to invest in the stock market to accumulate wealth, that potential wealth is now used to repay loans,” said Nicole Smith of Georgetown University Center on Education and the Workforce when speaking to CNBC in 2020.
From homeownership to continuing their education, Black people are constantly fighting to overcome the racial disparities prevalent in this country since its inception. Loan debt is just another layer to a multi-layered cake.
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