How big of a problem is student debt? Some say the effect student loan debt has on the economy is similar to that of a recession, reducing business growth and suppressing consumer spending.
Others argue that the benefits of a college education outweigh the burdens of the loans. The average bachelor’s degree holder earns up to $33,000 more annually than a high school diploma holder, according to the Education Data Initiative.
At the end of the first quarter of 2022, total outstanding college-loan balances stood at nearly $1.61 trillion, according to the Department of Education.
Now, up to 43 million borrowers have been given some student debt forgiveness, totaling somewhere between $360 billion and $427 billion, according to a range of estimates.
Attending college in some states is cheaper than others, and that certainly affects the debt that students take on.
For in-state residents, tuition and fees in California are cheapest, at $3,161 for the 2021-22 academic year. For out-of-state residents, Mississippi is cheapest, at $7,862, according to the National Center for Education Statistics. Vermont is the most expensive across the board for in-state, out-of-state and private schools.
The Institute for College Access & Statistics found that the states with the largest average loan debt per student upon graduation were New Hampshire ($39,928) Delaware ($39,705) and Pennsylvania ($39,375.) New Hampshire and Pennsylvania are among the most expensive for in-state tuition.
To find the states with the most and least student debt, personal finance site WalletHub compared all 50 states and the District of Columbia based on 11 key measures of indebtedness and earning opportunities. The data set ranges from average student debt to unemployment rate among the population aged 25 to 34 to share of students with past-due loan balances.
The states with the highest proportion of student debt are South Dakota, New Hampshire, West Virginia and North Dakota. The states with the lowest proportion are Utah, Hawaii, and New Mexico.
It remains to be seen which states will actually benefit most from the recent forgiveness plan.
Here are all 50 states and D.C., ranked by most to least student debt.
1. West Virginia
- Student-loan indebtedness rank: 2
- Grant & student work opportunities rank: 8
In these rankings, No. 1 represents the worst conditions for that metric category.
West Virginia also has the third highest rate of student debt as percent of income (adjusted for cost of living.)
2. Pennsylvania
- Student-loan indebtedness rank: 4
- Grant & student work opportunities rank: 2
3. South Dakota
- Student-loan indebtedness rank: 3
- Grant & student work opportunities rank: 28
4. New Hampshire
- Student-loan indebtedness rank: 1
- Grant & student work opportunities rank: 48
5. Mississippi
- Student-loan indebtedness rank: 5
- Grant & student work opportunities rank: 21
Mississippi also has the highest rate of student debt as percent of income (adjusted for cost of living.)
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6. Delaware
- Student-loan indebtedness rank: 6
- Grant & student work opportunities rank: 30
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7. Kentucky
- Student-loan indebtedness rank: 10
- Grant & student work opportunities rank: 11
8. Rhode Island
- Student-loan indebtedness rank: 7
- Grant & student work opportunities rank: 47
Rhode Island falls into the category of states with both high student debt and low home-ownership for people aged 25-34.
9. South Carolina
- Student-loan indebtedness rank: 11
- Grant & student work opportunities rank: 16
10. North Dakota
- Student-loan indebtedness rank: 8
- Grant & student work opportunities rank: 41
Though among the highest for student debt, North Dakota does has one of the lowest unemployment rates for people aged 25-34.
11. New Jersey
- Student-loan indebtedness rank: 15
- Grant & student work opportunities rank: 18
New Jersey falls into the category of states with both high student debt and low home-ownership for people aged 25-34.
12. Connecticut
- Student-loan indebtedness rank: 13
- Grant & student work opportunities rank: 26
13. Ohio
- Student-loan indebtedness rank: 17
- Grant & student work opportunities rank: 14
In WalletHub’s study, Ohio falls into the category of states with both high student debt and low home-ownership for people aged 25-34.
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14. Wisconsin
- Student-loan indebtedness rank: 16
- Grant & student work opportunities rank: 20
15. Minnesota
- Student-loan indebtedness rank: 9
- Grant & student work opportunities rank: 50
Minnesota ranks among the five states with the highest proportion of students with debt.
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16. Iowa
- Student-loan indebtedness rank: 12
- Grant & student work opportunities rank: 37
Iowa has one of the lowest unemployment rates for people aged 25-34.
17. Michigan
- Student-loan indebtedness rank: 19
- Grant & student work opportunities rank: 9
18. Maine
- Student-loan indebtedness rank: 14
- Grant & student work opportunities rank: 49
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19. Kansas
- Student-loan indebtedness rank: 18
- Grant & student work opportunities rank: 33
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20. Alabama
- Student-loan indebtedness rank: 21
- Grant & student work opportunities rank: 17
Alabama has the second highest rate of student debt as percent of income, following Mississippi.
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21. Indiana
- Student-loan indebtedness rank: 22
- Grant & student work opportunities rank: 23
Indiana has one of the lowest unemployment rates for people aged 25-34.
22. Oklahoma
- Student-loan indebtedness rank: 24
- Grant & student work opportunities rank: 5
23. Georgia
- Student-loan indebtedness rank: 23
- Grant & student work opportunities rank: 19
24. Missouri
- Student-loan indebtedness rank: 20
- Grant & student work opportunities rank: 36
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25. Louisiana
- Student-loan indebtedness rank: 31
- Grant & student work opportunities rank: 3
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26. North Carolina
- Student-loan indebtedness rank: 28
- Grant & student work opportunities rank: 10
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27. Tennessee
- Student-loan indebtedness rank: 27
- Grant & student work opportunities rank: 22
28. Texas
- Student-loan indebtedness rank: 34
- Grant & student work opportunities rank: 4
29. Arkansas
- Student-loan indebtedness rank: 29
- Grant & student work opportunities rank: 24
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30. Illinois
- Student-loan indebtedness rank: 26
- Grant & student work opportunities rank: 39
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31. Nebraska
- Student-loan indebtedness rank: 25
- Grant & student work opportunities rank: 42
Nebraska has one of the lowest unemployment rates for people aged 25-34.
32. Vermont
- Student-loan indebtedness rank: 32
- Grant & student work opportunities rank: 45
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33. Virginia
- Student-loan indebtedness rank: 30
- Grant & student work opportunities rank: 46
34. Massachusetts
- Student-loan indebtedness rank: 33
- Grant & student work opportunities rank: 43
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35. Maryland
- Student-loan indebtedness rank: 35
- Grant & student work opportunities rank: 40
Maryland has the highest unemployment rate of all 50 states for people aged 25 to 34.
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36. New York
- Student-loan indebtedness rank: 38
- Grant & student work opportunities rank: 15
37. Idaho
- Student-loan indebtedness rank: 36
- Grant & student work opportunities rank: 38
Idaho falls in the category of low student debt and a high homeownership rate for people aged 25-34.
38. Hawaii
- Student-loan indebtedness rank: 40
- Grant & student work opportunities rank: 6
Hawaii has the second lowest rate of student debt as percent of income (adjusted for cost of living.)
39. Montana
- Student-loan indebtedness rank: 37
- Grant & student work opportunities rank: 44
Montana has one of the lowest unemployment rates for people aged 25-34.
40. Oregon
- Student-loan indebtedness rank: 41
- Grant & student work opportunities rank: 12
41. Arizona
- Student-loan indebtedness rank: 39
- Grant & student work opportunities rank: 29
42. Nevada
- Student-loan indebtedness rank: 45
- Grant & student work opportunities rank: 1
Nevada is among the six states with the lowest proportion of students with debt.
43. Alaska
- Student-loan indebtedness rank: 43
- Grant & student work opportunities rank: 25
44. Colorado
- Student-loan indebtedness rank: 42
- Grant & student work opportunities rank: 34
45. Wyoming
- Student-loan indebtedness rank: 44
- Grant & student work opportunities rank: 27
Wyoming is one of a handful of states, along with Montana, Vermont, Nebraska and Utah, with both low student debt and a high home ownership rate for people aged 25-34.
46. Florida
- Student-loan indebtedness rank: 46
- Grant & student work opportunities rank: 13
47. New Mexico
- Student-loan indebtedness rank: 48
- Grant & student work opportunities rank: 32
48. Washington
- Student-loan indebtedness rank: 47
- Grant & student work opportunities rank: 35
49. California
- Student-loan indebtedness rank: 49
- Grant & student work opportunities rank: 7
California is among the five states with the lowest rate of student debt as percent of income, as well as among those with the lowest proportion of students with debt.
50. District of Columbia
- Student-loan indebtedness rank: 50
- Grant & student work opportunities rank: 51
D.C. also has the lowest rate of student debt as percent of income (adjusted for cost of living.)
51. Utah
- Student-loan indebtedness rank: 51
- Grant & student work opportunities rank: 31
Along with being the state with the lowest student loan indebtedness, Utah also has the third lowest rate of student debt as percent of income (adjusted for cost of living.) Utah also has the lowest unemployment rate of all 50 states for people aged 25-34. It’s also among the five states with the lowest percentage of student-loan balances that are past due or in default.
See more information about this study at WalletHub.com.
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