Student debt is a hot topic in politics and campaigns, in no small part because after mortgages, it is the largest type of debt in the United States. This month the financial literacy site Wallet Hub ranked the states on “most to least” in student loan debt. Wisconsin placed as the 18th worst on the basis of 12 measures of indebtedness and earning opportunities.
One source used in Wallet Hub’s analysis is the Institute for College Access and Success, which puts the average student debt in Wisconsin at $29,569 — a bit more than average among the states.
But the group also places Wisconsin as 6th worst in the country when it comes to the proportion of students with debt. That’s a full 64 percent of former students in debt. According to one Wisconsin Now (OWN), which has done extensive research on the student loan borrowing crisis in our state, more than one million Wisconsinites carry $24 billion in total student-loan debt.
OWN places much of the blame for that debt on completely inadequate state financial aid.
“What stands out about student debt in Wisconsin is that we have a high percentage of college graduates who needed to take out student loans to pay for their education,” says OWN’s Mike Browne. “While tuition at state schools is middle of the road, state financial aid is wildly underfunded, leaving tens of thousands of students who are eligible for help with none.
“Wisconsin borrowers are hard working and responsible and while default rates are lower than the national average here, the economic impact of the $24 billion student loan debt crisis in Wisconsin is dramatic and negative on both state borrowers and our economy as a whole.”
A provision in Gov. Tony Evers’s budget that would have studied the state’s ability to help borrowers refinance those loans was eliminated by Republicans. Democratic State Treasurer Sarah Godlewski has said she will move forward with research into the state refinancing student loan debt anyway.