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Student Loan Payments at Age 40? Study Says it’s Not as Rare as You May Think

You’ve worked hard to earn an undergraduate (and maybe even graduate) degree. As soon as you graduate, it should be...

Published July 17, 2017

You’ve worked hard to earn an undergraduate (and maybe even graduate) degree. As soon as you graduate, it should be time to reap the rewards of your promising professional career, not worry about your looming student loans and the debt ahead…

Unfortunately, student loan debt is a reality for most U.S. college students. In fact, around 70% of graduates leave college with student loans to repay.1

For federal non-consolidated student loans, the standard repayment plan expects borrowers to pay off their student debt in 10 years, but for many, it may take twice as long. According to research conducted by Citizens Financial Group, 60% of student debt borrowers expect to pay off their student loans in the 40s.2 For most, that’s over 20 years from graduating college!

This means that while you’re repaying your student loans, you may also be paying for a mortgage or personal loan, or even a parent plus loan on behalf of your children who are attending college.

Data collected at the state level supports these findings, including a study conducted by the One Wisconsin Institute which found that it takes graduates of Wisconsin universities 19.7 years to pay off an undergraduate degree and 23 years to pay off a graduate degree.3

Just how many borrowers are actually in their 40s? Well, the Federal Reserve reports there are 6.8 million student loan borrowers between 40-49 years of age, holding a collective debt of $229.6 billion.4

Total Student Loan Balances

This is not exactly a “so what?” situation! While it’s difficult to determine the actual implications of the growing student debt burden, many believe it has a strong impact on the housing industry as well as the age of retirement.

• The Federal Reserve Board of Washington D.C. found that an increase in student debt has led to a decrease in home ownership.5

• Plus, a study conducted by NerdWallet predicts that students who graduate from college in 2015 will have to delay retirement to 75, in part due to paying off student debt.6

The good news is, there are various repayment options that allow borrowers to pay off their student loans. One option many borrowers take if they qualify is refinancing their student loans to lower their interest rate.

With Laurel Road, you can refinance your student loans while at home in your pajamas!

The application process is entirely online and completely free. You’ll get a preliminary rate offer in minutes and there’s no obligation to accept!

We offer low rates, personalized customer service, and technology that allows for a seamless, hassle-free refinancing process.

Not sure if refinancing is right for you? We also offer a free student loan calculator that allows you to wade through all of your repayment options and identify opportunities to save money. Simply enter your educational background, loan amount and employment information and we’ll help you clearly compare each repayment option.


1 The Institute for College Access and Success. Student Debt and the Class of 2013. https://files.eric.ed.gov/fulltext/ED560042.pdf

2 Citizens Financial Group, Inc. https://investor.citizensbank.com/about-us/newsroom/latest-news/2016/2016-04-07-140336028.aspx

3 One Wisconsin Institute. Impact of Student Loan Debt on Homeownership Trends and Vehicle Purchasing. https://drive.google.com/file/d/0B8LurBVUNQZfQVhYZWZvamlfd00/view

4 Federal Reserve Board. Report on the Economic Well-Being of U.S. Households in 2015. https://www.federalreserve.gov/econresdata/2016-economic-well-being-of-us-households-in-2015-education-debt-student-loans.htm

5 Federal Reserve Board of Washington, D.C. On the Effect of Student Loans on Access to Homeownership. https://www.federalreserve.gov/econresdata/feds/2016/files/2016010pap.pdf

6 Nerdwallet’s 2015 New Grad Retirement Report. https://www.federalreserve.gov/econresdata/feds/2016/files/2016010pap.pdf

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