In which states do Americans owe the most money on student debt?

Americans are once again juggling their federal student loan payments with all their other bills as the moratorium is clearly in the rearview mirror. By the end of the second quarter of 2023 across the nation there was a total of nearly $1.77 trillion in outstanding federal student loan debt.

The average balance for borrowers is currently almost $38,000 but the amount of debt held throughout the US is not uniform. Nor is the amount that borrowers pay on a monthly basis with a nearly $100 difference between the states with the highest and lowest median student loan payment.

In which states do Americans owe the most money on student debt?

Student loan debt is second only to mortgage debt as the largest component of American household debt. Wallet Hub recently released an analysis comparing all 50 states and the District of Columbia. It found that the five states with the highest average student debt were New Hampshire, Delaware, Pennsylvania, Rhode Island and Connecticut.

However, for borrowers in these five states; Mississippi, Alabama, West Virginia, South Carolina and Kentucky, their student loan debt made up the highest percentage compared to income when adjusted for cost of living.

Other research gives slightly different results like that reported by CNBC looking at Federal Reserve data. These are the five states with the highest median student loan debt.

States where Americans monthly student loan payments are highest

Student loan repayments started up again in October after they and interest accruement had been frozen since March 2020. Here are the ten states where borrowers have the highest and lowest median monthly student loan payments according to Wallet Hub.

What is happening with Biden’s student loan forgiveness plan?

The Biden administration had attempted to forgive up to $20,000 of student loan debt but the Supreme Court found the measure overstepped the Department of Education’s authority to discharge outstanding balances. The White House hasn’t given up though releasing proposals for a ‘Plan B’ that is being hammered out through a process known as ‘negotiated rulemaking’. The outcome of those discussions most likely won’t be known until early next year at the soonest.

In the meantime though, borrowers can look into taking advantage of the Saving on a Valuable Education (SAVE) plan announced by President Biden in August. The new plan from the White House amends the terms of the Revised Pay As You Earn (REPAYE) as well as speeding up when a borrower would be eligible for student loan forgiveness and has been dubbed “the most affordable student loan plan ever.”