People with student loans regret borrowing too much

It's time to start chipping away at those student loans as interest is already accumulating.
Published: Sep. 26, 2023 at 2:57 PM MST
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PHOENIX (3TV/CBS 5) — Americans are facing a mountain of student loan debt, totaling more than $1.7 trillion, and it’s a serious source of stress for many borrowers. In fact, almost a quarter of people who have student loan debt say borrowing too much is their biggest financial regret, according to a recent Bankrate survey. “I think what this shows is student loan debt can really become a huge inhibitor for Americans to grow their wealth,” said Bankrate’s Sarah Foster. “They say that they haven’t really been able to buy a house because of that debt. Some of them are delaying getting married or having children.”

While 24% of people with student loan debt said borrowing too much was their biggest financial regret, 20% said they have no financial regrets, 17% said their biggest financial regret is not enough emergency savings, 15% are the most frustrated about too much credit card debt, and 13% said their biggest financial regret is saving for retirement too late.

Though student loan payments will resume in October, borrowers will have an extra buffer through the recently announced student loan on-ramp. Through next September, borrowers who miss payments won’t be considered delinquent, and late payments will not be reported to credit bureaus. Interest will still accrue. “It could give borrowers some peace of mind knowing that if they don’t make payments for the next 12 months, if they simply can’t afford to, there might not be financial consequences for it,” Foster said. “But the way I’m thinking about it is this is basically just kicking the can down the road. Eventually your student loan payments are going to come due again, and so it’s important to really take these steps as soon as possible to figure out how to fit it into your budget.”

That may include a payment plan. One option is the new SAVE program, which is income-driven. For some borrowers, monthly payments could be as low as zero dollars, depending on how much money they make.

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