Student loan debt in the U.S. has set a new record, hitting $1.465 trillion in November, according to a new analysis by Bloomberg.
According to Bloomberg’s analysis of student loan securitization data, the debt level is more than double the $675 billion in student loan debt back in June of 2009. That was when the Great Recession ended.
Bloomberg found that people who took out student loans in 2012 have defaulted at a quicker pace than any other borrowers since the financial crisis, and that loans issued in 2012 have the highest cumulative loss percentage when compared to any other year since 2009 when the recession ended. That implies borrowers who took out student loans in 2012 are having a harder time paying back their loans each month compared to those who got student loans before or after the recession.
Bloomberg noted that a lot of those who took out student loans are now in the 24-to-33-year-old range, which is typically the age in which people are starting out in their careers. Borrowers from 2012 also came into the labor pool amid high unemployment and have had a hard time finding jobs in their chosen career. What’s more, Bloomberg said in 2012 it took three times longer to find a job when compared with 2018. Bloomberg cited the Bureau of Labor Statistics for that data.
Broken down by age, Bloomberg found those in the 25-to-34 age group owed $489 billion in student loans, under the $530 billion those aged 35 to 49 owe. There were 1.8 million borrowers that were 62 years old, owing $62.5 billion, while those in the 50-61-year-old group owe $213.6 billion.
Student loan debt isn’t the only credit issue facing consumers heading into the new year. LendingTree recently reported that based on holiday shopping and credit card spending, balances on credit cards will increase by around 5 percent through the end of the year. That will push the balances to more than $1 trillion. That would result in a debt level of $4 trillion for U.S. consumers this year.