Equal Opportunity Debt: Even the Rich Are Saddled With Student Loans


With college tuition skyrocketing, it’s hardly shocking that the number of students who borrow money to fund their education is at an all-time high.

What’s more surprising is exactly who is doing much of the borrowing. Nowadays, it’s not just low- or middle-income families struggling to make ends meet who take out loans to cover college costs. In the last two decades, record numbers of high-income students have also had to borrow money for school.

To be sure, the highest proportion of student loan borrowers still come from low-income households. But, according to a Pew Research Center analysis, the rate of increase among high- and upper-middle-income borrowers surpassed that of low-middle and low-income borrowers.

In the 2011-2012 school year, half of high-income grads had student loans, compared with less than a quarter in 1992-1993. Similarly, 62% of upper-middle-income grads had debt in 2011-2012, compared to just 34% in 1992-1993. (By comparison, 77% of low-income grads had loans in 2011-2012, compared with 67% in 1992-1993.)

So what’s behind the steady increase in borrowing among the wealthy? A number of factors might be at work. For one, Richard Fry, senior economist at Pew Research Center, told MarketWatch that before the recession, affluent families often took out home equity lines of credit to pay for school. After the downturn, banks became much stricter with HELOCs.

Another possibility is the fact that federal loans are now available to a wider range of borrowers. In the past, money lent under the Direct Loan program (previously called the Stafford), was only given to undergraduates demonstrating financial need. Then, in the early 1990s, the program’s policy changed to allow all students to take out loans.

The bottom line: no matter your socioeconomic standing, the process of paying for college can be stressful and downright confusing—so check out our comprehensive guide to taking out and repaying student loans.

  • Laura Knight

    My biggest takeaway from the life is how important it is to try out a job/many jobs before heading to grad school. If you had entered “the real world” after undergrad, you may have discovered a job that made you really happy before going into debt for your graduate degrees. I agree about having a statute of limitations on regret, so I’m not trying to make you feel bad about this – but this is a super important lesson for a lot of people that prevent them from additional financial troubles and no credit check pay day loans for short term use applyings.