The University of Wisconsin Institute for Research on Poverty hosted a webinar Oct. 29. The webinar examined the effects of student loans and how they specifically target Black students and families, welcoming three experts to discuss a variety of effects impacting students.
UNC-Chapel Hill associate professor of public policy Fenaba Addo said that Black students have 85% more debt than white students when leaving college, and — after 10 years post-graduation — Black students have 170% more debt than white students.
“These stark racial disparities in student loan debt accumulation and repayment make it clear that race and racial inequality are central to understanding the student loan debt crisis in the United States,” Addo said. “I want to underscore that student debt is not just an individual burden, but a societal mechanism that is reinforcing and recreating inequality.”
In her co-authored book “A Dream Defaulted,” Addo said she explored how individual stories combined with a decade of research showed how Black students are disadvantaged in debt accumulation and repayment. This debt accumulation impacts economic, psychological and social well-being, restricting career choices, Addo said.
University of Memphis assistant professor of higher and adult education Daniel Collier researched impacts of student loan debt on mental health, particularly from income-driven repayment plans and loans from the Public Service Loan Forgiveness program.
“There’s something that we found that was really interesting in people waiting on a forgiveness decision,” Collier said. “These people have been waiting anywhere from a few months to over a year, and in that time, uncertainty exists. With that, more people started thinking about self-harm.”
According to Collier, data shows that 19% of PSLF and Income-Driven Repayment plan holders experience self-harm thoughts and 20% experience suicidal ideation thoughts.
In terms of receiving federal-given or state-given financial aid, the process is lengthy, University of Delaware associate professor of education policy Dominique Baker.
“It’s important to note that these burdens typically have a stronger effect on people who have less time, less money and less power,” Baker said.
Baker said that in the instances when requirements to access financial aid were changed, they were modified to increase the level of burden felt by students. These burdens include the time and effort it takes to determine eligibility for programs and the stigma students may feel for needing financial aid, Baker said.
In her research on Tennessee’s financial aid programs, Baker found that programs designed for racial minorities had higher burdens on students than other financial aid programs. Baker said it is not enough for states to just have financial aid programs, it is also important to understand the hoops that students must jump through to gain access.
“Student debt is not just an individual burden but a societal mechanism that is reinforcing and recreating inequality,” Addo said.
