With student loan debt increasing by over $3,000 per second in the USA and the price of a college degree rising over the last 30 years at more than three times the rate of inflation, when they’re thinking about which universities to attend, students today are looking out at a much different economic landscape than their parents.
With this in mind, Credit Karma set out in July to survey 500 Millennials (ages 18-34) and 500 Baby Boomers (ages 50-65) in America to compare how much they borrowed to pay for their education and how the two generations felt about this rising price tag.
The most obvious finding from our survey wasn’t a surprise: the cost of higher education has increased massively in America. Millennials were almost two-and-a-half-times more likely than Baby Boomers to have paid $30,000 or more for their education (47 percent to 19 percent), and more than three times as likely to have paid $60,000 or more. Almost 1-in-8 Millennials said that they had borrowed $50,000 or more to pay for their education.
Conversely, Baby Boomers reported back much lower price tags: 38 percent reported that their education cost them less than $15,000, while almost 60 percent of them said they paid less than $30,000. Even providing for inflation, that’s still a significant contrast.
Underneath this though, is a much more troubling reality. As tuition costs skyrocket, Millennials are being forced into debt at an unprecedented rate. Almost three-quarters of them surveyed (73 percent) borrowed to pay for their degree, with more than half of all them borrowing half or more of the cost of their education.
In contrast, most Baby Boomers (54 percent) said that they didn’t have to borrow at all.
This burden of debt falling on Millennials for their education is considerable: as a whole, they were three times more likely than Baby Boomers to report borrowing half or more of the cost of their degree and were almost three times more likely to have borrowed the cost of their entire education.
Distressingly, for how heavy this burden of debt is, more than one-in-four Millennials (28 percent) felt like their education didn’t bring them enough benefit to justify the steep investment.
The burden of this debt however, is making Millennials feel more responsible to help pay for their own children’s future degrees. More than four out of five surveyed (82 percent) said that they felt an obligation to help, which is perhaps a reflection of the help they received themselves. Over half of Millennials reported that a friend or family member contributed to their education.