Average Student Loan Debt for Undergraduate Degrees: A Comprehensive Overview

Student loan debt has become a significant concern for many students and their families as they navigate the increasing costs of higher education. Every year, student loan debt climbs further into the stratosphere, burdening students long after graduation. Understanding the average student loan debt for undergraduate degrees is crucial for prospective students, current borrowers, and policymakers alike. This article provides a comprehensive overview of student loan debt, its impact, and strategies for managing it effectively.

The Landscape of Student Loan Debt

Student loan debt is, for many, a fact of life. The national student loan debt was $1.64 trillion in the second quarter of 2025. As of June 2025, 32% of borrowers owed less than $10,000 and 21% owed between $10,000 and $20,000 in federal loan debt. A total of 42.5 million borrowers have federal student loan debt. The average federal student loan debt is $39,075 per borrower. Some borrowers have multiple federal loans.

Average Debt Amounts

The average student loan debt is $28,500 for those graduating with a bachelor’s degree from a public or private four-year college. For those graduating from a public university, the average is slightly lower - $26,900. As you’d expect, private college graduates’ average debt is higher than the norm at $32,600. The average amount borrowed by 2023-24 bachelor’s degree recipients who took out loans to pay for college was $29,560.

News data showed that graduates from the class of 2024 who took out student loans en route to a bachelor's degree borrowed $29,890 on average. Those who graduated in 2024 from a ranked private, nonprofit college borrowed more on average, at $32,806, than public college graduates, who took out $25,549. The average debt among 2024 graduates of proprietary or for-profit schools was $32,787.

For 2015-16 bachelor’s degree completers who had ever received federal student loans, the average amount borrowed as of 2020 was $45,300. Among these completers, the average amount borrowed was higher for those who had ever received a Pell Grant than for those who had not ($47,100 vs. $42,200).

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Trends in Student Loan Debt

Between 2010-11 and 2020-21, the average annual student loan amount for students decreased by 8 percent, from $8,400 to $7,700 (in constant 2021-22 dollars). The average total student loan debt, which includes both federal and private loans, jumped by $11,169 from 2005 to 2017. But in recent years, the average amount borrowed has stabilized.

After declining by 38% over 13 years, from $163.9 billion (in 2024 dollars) in 2010-11 to $101.4 billion in 2023-24, total annual borrowing increased to $102.6 billion in 2024-25 (1.2% year-over-year increase).

Factors Influencing Debt Amounts

Borrowing is often tied to the cost of college tuition and fees, and other educational expenses such as housing, food and textbooks. Financial aid can help cover these expenses, but families often experience a gap between financial aid received and the remaining cost of college. States have been less and less able to subsidize their public institutions as the vast majority of students enroll in public institutions, whether two-year or four-year. Over the last few decades - since the '80s - states have been removing more of these costs from their budgets and putting them "on the backs of individual students and families to make up in the form of tuition and fees and other costs," she says.

Impact on Millennials and Graduates

Millennials with student loan debt play with a metaphorical arm tied behind their back. Excessive student debt can make it more difficult to accumulate wealth. A 2014 report by the Pew Research Center shows that the median net worth of a household headed by a college graduate under the age of 40 with student loan debt was $8,700.

Delayed Life Milestones

Even if your student debt allows you to live independently, you may have to delay other goals, such as buying a house, getting married, or starting a family. It’s the waking nightmare of every college graduate: ending up back in your childhood bedroom surrounded by old concert posters and stuffed animals because you can’t afford to live on your own.

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Financial Strain

Student loans are a burden for many Americans, especially when inflation rises significantly or during an economic recession. This debt often has a major impact on the quality of life for those who take out loans to pay for college, especially for borrowers who go into default, experts say. Student loan debt has a ripple effect on nearly every aspect of a borrower's life. It can delay major milestones like buying a home, starting a family or saving for retirement. Having debt can also take an emotional toll. Borrowers often report feeling stressed, anxious and overwhelmed.

Default Consequences

Defaulting technically occurs after more than 270 days of overdue payment, leading to potential legal implications and lost eligibility for further federal student aid. About 10% of aggregate student debt was reported to be at least 90 days past due, per Federal Reserve data. Defaulting can damage your credit score, making it harder to qualify for future loans or even rent an apartment. In the case of federal loans, your wages can be garnished, and you may lose access to important benefits like deferment or income-driven repayment plans.

Strategies for Managing and Minimizing Student Loan Debt

Student loan debt is, for many, a fact of life. You can either sit back and throw up your hands in defeat, or try to do something about it!

Smart Borrowing Practices

To make loan payments comfortably, you’ll need to maintain a manageable debt-to-income ratio. If you’re tempted to borrow more than you can comfortably afford, think twice before signing on the dotted line. If you leave your undergraduate program with a significant amount of debt, you may not be able to take out another massive loan.

Exploring Affordable Options

Public institutions are often dismissed in favor of flashier private colleges. USF is a top-50 public research university with some of the lowest tuition rates in the nation, making it an affordable choice for both Florida and non-Florida residents.

Financial Aid and Grants

To help offset the cost of attending a postsecondary institution, Title IV of the Higher Education Act of 1965, as amended, authorized several student financial assistance programs-namely, federal grants, federal loans, and the Federal Work-Study Program. The largest federal loan program is the William D. Ford Federal Direct Loan Program, for which the federal government is the lender. Other types of student loans include institutional loans and private loans.

In 2024-25, total federal grant aid was $53.7 billion including $38.6 billion in Pell Grants. Between 2022-23 and 2024-25, total Pell Grant expenditures increased by 32% (from $29.2 billion to $38.6 billion), after adjusting for inflation. Between 2013-14 and 2023-24, average state grant aid per FTE undergraduate student increased from $920 to $1,280 in 2023 dollars. Over the last decade, institutional grant aid grew by an additional 24% to $85.1 billion in 2024-25.

Refinancing Student Loans

What if you could save thousands of dollars each year by refinancing your student loans? It’s possible with the Citizens Education Refinance Loan. Compare rates for different lenders and check your credit score - applications are approved based on creditworthiness.

Income-Driven Repayment Plans

In recent years, most students with federal loans became eligible to enter an income-driven repayment plan for federal loans.

The Broader Economic Context

Some have also raised concerns that the nation’s total student debt balance, which includes graduate student debt, now stands at $1.75 trillion. It is true that total student debt has increased over the past two decades. Yet this increase is due in part to swelling enrollment at the nation’s universities. And although 13 percent of Americans hold graduate degrees, 57 percent of all debt is owed by households with a graduate degree. Students in these programs take on more debt as they pursue a career in a field that pays significantly more.

Homeownership and Student Debt

Some have claimed that student debt prevents graduates from becoming homeowners. But examining the data, the White House Council of Economic Advisors concluded that attending college makes individuals more, not less, likely to own a home. By age 26, households with student debt are more likely to buy a house than those that did not attend college. By age 34, college attendees with and without student debt are equally likely to buy a home, and both much more likely than those without a college education.

Making Informed Decisions About Student Loans

As prospective students start thinking about college, cost should not be the only factor. Research colleges' outcomes data and potential future earnings, experts say. The idea that students from low-income backgrounds have sufficient grant aid or state aid to cover their costs is not true. A lot of those students say, 'We basically can't enroll in college without taking on some type of debt.' It becomes this question of, 'Is this good debt or is this bad debt?' That really depends on what type of program the student enrolls in, if they are able to complete some kind of degree or credential that then increases their earning potential and enables them to make good on that loan investment and repay over time.

Ultimately, if you decide to take out a loan, it's essential to understand what you're signing up for. That means looking at the total cost of the loan - not just the amount borrowed, but the interest and repayment terms over time. Undergrads should maximize the amount of federal student loans they can take out before considering private loans, since federal options usually come with "more consumer protections" and "typically lower rates." If you are looking at the private market, be very discerning about what company you're working with, what lender you're working with and see if there are any other options that you can take on before taking on that private debt. The repayment terms are typically really strict and the rates are typically higher, and many times they're a variable rate. So those loans are just not anywhere near the kind of consumer-friendly 'product' that is available through the federal government.

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