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Posted on: 01 Jul 2025
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Student loan debt has emerged as one of the most pressing financial challenges in the United States, shaping the lives of millions of borrowers and influencing the broader economy. As of 2025, the total student loan debt in the U.S. is estimated at $1.77 trillion, impacting approximately 43 million borrowers. This debt is not distributed evenly across the country; it varies significantly by state, driven by factors such as the cost of higher education, the prevalence of colleges and universities, state-specific economic conditions, and policy differences. Understanding these variations is critical for policymakers, educators, financial institutions, and borrowers to address the issue effectively and equitably.
This in-depth report provides a detailed examination of student loan debt across all 50 states, the District of Columbia, and Puerto Rico, using the most current data available as of 2025. We will explore national trends, state-specific statistics, contributing factors, economic and social impacts, policy considerations, and recent developments, including the resumption of federal loan collections. The report aims to offer a comprehensive resource for understanding the student loan debt landscape and its implications for 2025.
National Overview of Student Loan Debt
Before examining state-specific data, it’s essential to understand the national scope of student loan debt. According to the U.S. Department of Education, as of March 2025, federal student loan debt totals $1.66 trillion, held by 42.7 million borrowers. When private student loans are included, the total debt reaches $1.77 trillion, as reported by NerdWallet. The average federal student loan debt per borrower is approximately $38,375, while the total average balance, including private loans, may be as high as $41,618.
Additional national statistics highlight the scale of the issue:
- Total private student loan debt: $133.43 billion
- Average undergraduate borrower debt: $29,300
- Average household with student debt: $55,777
- Federal loans in default (Q4 2024): 4.86%
- Private loans in default (Q1 2024): 1.61%
The average public university student borrows $31,960 to attain a bachelor’s degree. In contrast, graduate and professional degree holders often face significantly higher debt, with averages of $77,300 and up to $296,500 for fields like dentistry. These figures underscore the growing reliance on loans to finance higher education and the challenges borrowers face in repayment.
Student Loan Debt by State
Student loan debt varies widely across states, reflecting differences in population size, educational infrastructure, and economic conditions. Below, we present a comprehensive table of federal student loan debt statistics for all 50 states, the District of Columbia, and Puerto Rico, sourced from the Education Data Initiative and SmartAsset. The table includes average borrower debt, total state debt, number of borrowers, and the percentage of the state’s population with student loan debt.
State Average Borrower Debt Total State Debt (Billions) Number of Borrowers % of Population with Debt Alabama $37,819 $24.9 658,400 12.8% Alaska $35,874 $2.4 67,400 9.1% Arizona $35,792 $32.9 914,400 12.1% Arkansas $34,024 $13.8 405,200 13.4% California $38,300 $151.5 3,956,100 9.6% Colorado $37,393 $29.2 781,000 12.9% Connecticut $36,837 $19.1 518,600 14.2% Delaware $38,856 $5.3 135,400 13.1% District of Columbia $54,561 $6.4 117,300 17.2% Florida $39,574 $108.1 2,717,200 12.0% Georgia $42,226 $71.7 1,695,500 15.4% Hawaii $38,929 $4.8 123,400 8.4% Idaho $33,621 $7.4 220,100 11.8% Illinois $39,042 $63.4 1,622,500 12.9% Indiana $33,234 $30.1 904,600 13.2% Iowa $30,698 $13.2 430,000 13.4% Kansas $33,013 $12.7 384,600 13.1% Kentucky $33,691 $20.7 614,200 13.5% Louisiana $34,821 $23.8 683,500 14.2% Maine $34,355 $6.5 189,200 13.9% Maryland $43,781 $37.1 844,600 13.7% Massachusetts $35,400 $32.6 921,000 13.2% Michigan $36,973 $51.6 1,395,600 13.6% Minnesota $34,163 $26.9 787,200 13.5% Mississippi $37,552 $17.0 452,800 15.2% Missouri $35,650 $29.7 833,200 13.6% Montana $34,215 $4.4 128,600 11.5% Nebraska $32,206 $8.0 248,900 12.6% Nevada $34,756 $12.7 365,200 11.0% New Hampshire $34,860 $6.7 192,100 14.0% New Jersey $37,287 $46.5 1,247,300 13.7% New Mexico $34,256 $7.8 227,800 10.8% New York $38,751 $96.3 2,473,200 12.6% North Carolina $38,929 $53.5 1,371,700 12.7% North Dakota $29,115 $2.6 89,200 11.4% Ohio $35,072 $62.6 1,784,200 15.1% Oklahoma $32,245 $16.4 504,700 12.4% Oregon $38,036 $20.3 533,600 12.6% Pennsylvania $36,120 $67.4 1,866,100 14.4% Puerto Rico $32,239 $10.8 335,000 10.5% Rhode Island $33,400 $5.0 149,700 13.7% South Carolina $38,715 $30.0 771,600 14.4% South Dakota $31,171 $3.7 119,300 13.0% Tennessee $37,054 $33.1 893,200 12.7% Texas $33,770 $131.9 3,905,600 12.8% Utah $33,872 $10.9 321,800 9.6% Vermont $37,760 $2.9 76,800 12.0% Virginia $40,287 $44.3 1,098,300 12.6% Washington $36,709 $29.0 790,000 10.2% West Virginia $32,343 $7.4 228,300 12.9% Wisconsin $32,619 $23.6 724,800 12.3% Wyoming $30,631 $1.7 55,600 9.5% Analysis of State Variations
The District of Columbia stands out with the highest average borrower debt at $54,561, likely due to its high cost of living and concentration of graduate and professional programs. Maryland and Georgia follow, with average debts of $43,781 and $42,226, respectively, reflecting higher tuition costs and a significant number of borrowers. In contrast, North Dakota has the lowest average debt at $29,115, possibly due to lower tuition costs at public institutions and a smaller population.
States with the highest total debt—California ($151.5 billion), Texas ($131.9 billion), and Florida ($108.1 billion)—are also the most populous, with large numbers of borrowers. Conversely, states like Wyoming ($1.7 billion) and North Dakota ($2.6 billion) have lower total debt due to smaller populations and fewer borrowers.
The percentage of the population with student loan debt also varies. Georgia (15.4%) and Mississippi (15.2%) have the highest proportions, indicating a widespread reliance on loans, while Hawaii (8.4%) and Wyoming (9.5%) have the lowest, possibly due to lower college attendance rates or more affordable education options.
Trends and Analysis
Student loan debt has been on an upward trajectory for decades, driven by rising tuition costs and increased enrollment in higher education. According to Forbes, tuition at public four-year colleges has risen from $4,160 in the early 1990s to $10,740 in recent years (adjusted for inflation), while private nonprofit institutions have seen costs increase from $19,360 to $38,070. This escalation has outpaced wage growth, making loans a necessity for many students.
Historical Trends
From 2014 to 2023, federal student loan debt grew by approximately 1% per quarter, though growth slowed to 0.64% per quarter during the COVID-19 payment pause from 2020 to 2023, when interest was eliminated and payments were suspended. Since the resumption of payments in September 2023, debt levels have resumed their upward trend, reaching a record $1.66 trillion in federal loans by March 2025, as reported by The Motley Fool.
Factors Contributing to State Variations
Several factors contribute to the differences in student loan debt across states:
- Tuition Costs: States with higher tuition costs, such as Maryland and New York, tend to have higher average debts. For example, private colleges in these states often charge upwards of $50,000 per year.
- Number of Higher Education Institutions: States with many prestigious or private universities, like California and New York, have more borrowers and higher total debt.
- Economic Conditions: States with higher costs of living, such as the District of Columbia, may see students borrowing more to cover living expenses alongside tuition.
- Demographics: States with younger populations or higher college enrollment rates, like Georgia, have a larger proportion of residents with student debt.
- State Policies: Some states offer more generous financial aid or lower in-state tuition, which can reduce borrowing needs. For instance, North Dakota’s public universities have relatively low tuition, contributing to its low average debt.
Age Group Analysis
Debt distribution also varies by age group, as shown in the following table from NerdWallet:
Age Group Total Outstanding Debt Number of Borrowers Average Debt per Borrower 24 and younger $96.3 billion 6.8 million $14,162 25-34 $487.3 billion 14.7 million $33,150 35-49 $646.6 billion 14.6 million $44,288 50-61 $290.1 billion 6.2 million $46,790 62 and older $121.5 billion 2.8 million $43,393 Older borrowers (35-61) tend to have the highest average debts, often due to graduate loans or prolonged repayment periods. In contrast, younger borrowers (24 and under) have lower debts, reflecting shorter borrowing periods or undergraduate-only loans.
Economic and Social Impacts
The burden of student loan debt has profound effects on individuals and the broader economy. For borrowers, high debt levels can delay major life milestones, such as purchasing a home, starting a family, or saving for retirement. According to SmartAsset, borrowers in their 60s still owe an average of over $40,000, highlighting the long-term financial strain.
Individual Impacts
- Financial Stress: High monthly payments can strain budgets, leading to financial insecurity and mental health challenges.
- Delayed Milestones: Studies suggest that student debt delays homeownership by several years, as borrowers prioritize loan repayments over saving for down payments.
- Career Choices: Some borrowers may choose higher-paying but less fulfilling careers to manage loan payments, limiting personal and professional satisfaction.
Economic Impacts
- Reduced Consumer Spending: High debt levels reduce disposable income, limiting spending on goods and services, which can slow economic growth.
- Default Risks: With 4.86% of federal loans in default as of Q4 2024, defaults pose risks to financial institutions and the broader economy.
- Labor Market Effects: High debt may discourage entrepreneurship or risk-taking, as borrowers prioritize stable incomes to meet repayment obligations.
Policy and Solutions
Several policies aim to alleviate the student loan debt burden, though their effectiveness and accessibility vary:
- Income-Driven Repayment (IDR) Plans: These plans adjust payments based on income, with forgiveness after 20-25 years. As of 2025, $56.5 billion has been forgiven for 1.4 million borrowers, with an average forgiveness of $40,357.
- Public Service Loan Forgiveness (PSLF): This program forgives loans for public sector workers after 10 years of qualifying payments. By 2025, $78 billion has been forgiven for 1.06 million borrowers, averaging $73,386 per borrower.
- Borrower Defense and Closed School Discharges: These programs have forgiven $28.7 billion for 1.6 million borrowers affected by fraudulent institutions.
- Total and Permanent Disability Discharge: $16.2 billion has been forgiven for 572,000 borrowers.
However, these programs face challenges, including complex eligibility requirements and low awareness among borrowers. The Saving on a Valuable Education (SAVE) plan is currently under legal scrutiny, leaving some borrowers in limbo.
Proposed Solutions
The debate over student loan debt solutions is polarized:
- Loan Forgiveness: Proposals for widespread forgiveness, such as $10,000 or $50,000 per borrower, are supported by those who argue it would stimulate the economy and promote equity. Critics, however, highlight the cost to taxpayers and potential moral hazard.
- Free or Subsidized College: Some advocate for free public college or increased state funding to reduce tuition costs, though implementation faces budgetary and political hurdles.
- Reforms to Loan Systems: Suggestions include capping interest rates, simplifying repayment plans, or expanding Pell Grants to reduce borrowing needs.
Recent Developments
A significant development in 2025 is the resumption of federal student loan collections, which had been paused since March 2020 due to COVID-19 relief measures. According to a U.S. Department of Education press release, collections restarted on May 5, 2025, affecting over 5 million borrowers in default. This includes actions like wage garnishment and the Treasury Offset Program, which could exacerbate financial difficulties for some borrowers.
The Trump administration’s focus on recouping payments, as noted in a CNBC article, marks a shift from the Biden administration’s emphasis on borrower relief. This policy change may disproportionately affect states with higher default rates or larger borrower populations, such as Georgia and Ohio.
Understanding Credit Repair Services
For borrowers struggling with student loan debt, credit repair services can offer a way to address credit score issues. These services focus on identifying and disputing errors on credit reports, such as incorrect late payments or defaults related to student loans. While they cannot remove accurate negative information, correcting mistakes can improve your credit score, making it easier to secure better loan terms or other financial opportunities. This can be especially helpful in states like the District of Columbia or Maryland, where high average debt levels may increase the likelihood of credit challenges.
Why It Matters
Student loan debt can impact your credit score, especially if payments are missed or loans go into default. Inaccurate credit report entries can worsen this, unfairly limiting your financial options. Credit repair services work to ensure your credit report is accurate, which is a critical step in managing the broader financial burden of student loans.
How to Connect
To explore credit repair services, research reputable providers that specialize in student loan-related issues. Look for companies with transparent processes and a track record of success, such as those that dispute thousands of incorrect credit report items annually. Always verify their legitimacy to avoid scams, and consider free credit counseling options offered by government resources for additional support.
Conclusion
Student loan debt remains a complex and multifaceted issue in the United States, with significant variations across states. The District of Columbia, Maryland, and Georgia face the highest average debts, while North Dakota and Wyoming have the lowest. These disparities reflect a combination of tuition costs, economic conditions, and demographic factors, though no single explanation fully accounts for the differences.
The economic and social impacts of student debt are profound, affecting individual financial stability and broader economic growth. While existing policies like income-driven repayment and public service loan forgiveness offer some relief, their limitations highlight the need for broader solutions. The resumption of loan collections in 2025 adds urgency to addressing these challenges, particularly for borrowers in default.
As the debate over student loan debt continues, policymakers, educators, and borrowers must work together to find equitable and sustainable solutions. By understanding the state-by-state landscape, we can better target interventions to alleviate the burden and ensure that higher education remains accessible without imposing lifelong financial strain.