The Relationship Between Student Debt and College Completion

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The District of Columbia is the student debt capital of America. At nearly $41,000, the average student loan burden for someone living in Washington, D.C., is $10,000 higher than in any other state.

Yet, the nation’s capital is also the most educated state or territory in America; it is the only place where a majority of people between ages 18 and 65 have at least an associate’s degree. So while the District of Columbia does lead in student debt, at least the accumulated loans appear to have led to successful degrees.

The link between debt and educational attainment is too frequently missing from national discussions on student loans. While it is easy to bemoan high levels of student debt and big numbers—such as the more than $1 trillion that Americans currently owe—not all loans are inherently bad. The major issue is whether students who borrowed completed their education. Data bear out this assertion. Borrowers who earn a degree are much less likely to default on their loans than those who do not, and dropouts represent an estimated 60 percent of all people who default on their loans.

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