The national student loan debt increases every year, which is no surprise. Right now, it’s somewhere around $1.38 trillion. What might shock you is what students are doing with their student loan money.
41% of non-educational loan money is spent on things like rent and cell phone bills, which definitely makes sense. After that, things get a little bit more frivolous. 15% is spent on clothing, while 12.8% is spent on restaurants and take-out, while 2.8% is spent on alcohol and drugs.
Meanwhile, 7 in 10 college students are stressed about their personal finances, and 3 in 10 students have neglected studying because of problems with money.
Having more financial literacy could help students struggling with cash. 7% of students don’t know the yearly costs for school, and 20% of students with loans don’t know the terms of loan repayment.
To make things even worse, the job market isn’t great, which makes it even harder to replay loans. The average starting salary for college grads has gone down over the past 15 years.
Something else to think about is the interest involved with loan repayments. Paying with non-loan money = spending less over time. Find out even more about college spending habits here.