College is a difficult time for frugality. You can do a lot with buying cheaper meals, eating out less often, curtailing your entertainment time and budget, living within your means as much as you can, but you still have to consider the significant issue of the debt you’ll owe as a result of studying at university.
This is what this post is about and it is specially dedicated to people like our friend Dahlia who already has her eldest in college and helping the younger one decide on his best options overall.
If you’re planning to go to college in the USA, whether because you want to study abroad or because you already live in the States, you’ll want to start planning early.
Surprisingly, just choosing the right state can actually have a significant impact on your student debt. With a state–by-state analysis of student debt, you’ll be able to choose wisely and get out of college for less. The figures are staggering but trust me, it pays off, in the end, to know all your options before you even start.
Average college debt: highs and lows
A good first number to look at is the average college debt in each state. You’ll find that college debt is actually fairly localized — New England tends to be higher, while the West Coast tends to be lower.
The highest states for average college debt are all in New England. Even in the five highest states, however, there are some significant differences; the highest is over $4,000 more expensive on average than the fifth highest.
● Connecticut ($38,510)
● Pennsylvania ($36,854)
● Rhode Island ($36,250)
● New Hampshire ($34,415)
● Delaware ($34,144)
The lowest states are all the way on the other side of the country. These are more than $10,000 less expensive on average than the most expensive states. In fact, the state with the lowest student debt boasts an average that’s just over $20,000 less than the state with the highest.
● Utah ($18,383)
● New Mexico ($21,237)
● Nevada ($22,064)
● Wyoming ($22,524)
● California ($22,785)
Choosing the right college (for lower college debt)
These averages, however, can sometimes be misleading. If you really want to get out of college with as little student debt as possible, you’ll want to look into specific colleges.
For evidence on how important it is to choose the right college, look no further than New York. Its statewide average is $30,931, which puts it at the high end of the middle of the pack. But it’s also home to the colleges with both the lowest and highest average debts: CUNY Lehman College with $4,410 and the New York School of Interior Design at $65,401. Two people in New York could have a $61,000 difference
in debt just because of the school they went to. That’s significant!
Although only one state has an average debt under $20,000, there are plenty of colleges with low average debts. Across the United States, you’ll find nine with at least one college that boasts an average student debt of less than $10,000.
● New York: CUNY Lehman College ($4,410)
● Kansas: Bethel College-North Newton ($5,633)
● Connecticut: Central Connecticut State University ($5,831)
● Texas: University of the Incarnate Word ($6,271)
● Idaho: College of Idaho ($7,202)
● Pennsylvania: Pennsylvania College of Technology ($7,219)
● Florida: Florida Agricultural and Mechanical University ($7,454)
● Kentucky: Berea College ($7,468)
Avoiding college debt loan delinquencies
When you get out of college, you don’t just have to worry about the fact that you have loans. It’s important that you’re able to pay off those loans in a timely manner. It’s actually one of the most important parts; delinquencies can stay on your record for many years, affecting your credit even after you’ve paid off the
But interestingly, college debt amounts and college loan delinquencies actually seem to have an inverse relationship. As noted before, New England tends to have a very high average debt, but it also tends toward “extremely low” delinquency rates according to MappingStudentDebt.org. The opposite is true in the Southwest, which has low average debt but “extremely high” delinquency rates.
It turns out that income has a much more significant effect on delinquencies than the amount of debt you have. If you live in a lower-income ZIP code, it’s important to strictly plan out your budget regarding your debt no matter how much you end up with.
There’s a lot to think about when it comes to student debt. If you’re careful, you can make it out of college with a minimum amount of student debt and the ability to pay it off, as both things that are important when living frugally.
Remember too that there’s a difference between college cost and college debt. When you decide on a college, take the time to look into scholarships and financial aid in every state. It could significantly change your college experience in the years to come.