SIOUX FALLS, S.D. (KELO) — A possible forgiveness of federal student loan debt or any related change could impact about 130,500 student borrowers in South Dakota that the New York Federal Reserve said existed in 2020.
The average student loan debt in South Dakota was $28,600 in 2020, according to the Federal Reserve of New York.
But some reports from 2021 show higher loan debt and fewer students.
The Education Data Initiative has 113,000 student borrowers in the state that owe on average $31,900. The average student loan debt for the Class of 2020 is $32,029, according to the Institute for College Access & Success.
That’s similar to lendedu.com which has an average of $31,129 in student loan debt. Lendedu.com estimated it would take South Dakotans about 14 years to pay off their debt based on an average payment of $191.74.
Lending Tree uses $30,317 for the average debt of federal and private student loans.
All that personal debt adds up to $3.6 billion in student loan debt attached to South Dakota residents, according to the Education Data Initiative.
Proponents of forgiving all or a substantial amount of student loan debt said it would stimulate the economy and offset the loss in repayment of federal loans. It would allow those in debt to make other purchases such as a house, vehicle and other items. It would also help offset the trend toward increased private debt for college costs.
Opponents of forgiving all or some of the student loan debt said it would not create a large enough multiplying impact. It would not create as much additional cash that would be spent. Opponents also say a broad approach does not account for those already paying back loans and the reasons that loans are in default now, including minority loan holders that may have needed to leave college.
The Brookings Institute said student loan debt is the second largest household debt. One in eight Americans has student loans.
