Why Women Owe Much More Student Loan Debt Than Men

Jessica Martinsen

It’s no secret that women owe much more student loan debt than men. In fact, women owe $1 trillion of the total 1.6 trillion dollar student loan debt, according to the American Association of University Women. 😳😳😳

But why do women owe so much more student loan debt than men? What can we do as a society to make sure women don’t take on $1 trillion in debt, and how can we make sure women have access to the same opportunities and resources to repay their loans? Continue reading to know why women owe much more student loan debt than men and what we can do to promote equality! 🦾

Why do women owe much more student loan debt than men?

For starters, women are more likely to be targeted by expensive for-profit colleges; however, the quality of these degrees tend to be lower than the quality of a degree at a traditional four-year university. Women also have fewer resources to pay for college, their Expected Family Contribution (when filling out the Free Application for Federal Student Aid) is lower than men’s. Furthermore, women are more likely to have family responsibilities in addition to their course work. This forces some women to take longer to graduate resulting in the need for more student loans. 

In 2020, female graduates make 74% of what male graduates make. Regardless of education level or job title, (this pay gap is wider for women of color), women have fewer financial resources to pay back their student loans. Women are also more likely to take time off of work for family and childcare responsibilities, which can lead to reduced access to advancement opportunities and higher gender-based wage gaps. Additionally, the cost of having to send a child to daycare can be very expensive, (the AAUW found that a year at daycare can cost more than a year at a public university), thus limiting discretionary income that could be used to pay for down debt. These external factors account for only a few of the reasons why women owe much more student loan debt than men.

What can society do to help promote equality? 

One way we can support gender equality is by allowing women to receive two thirds of the grants or non-loan financial aid to help pay for school. Since women graduate with more debt than men and face greater financial disadvantages during their careers, more grant and scholarship opportunities can somewhat equalize the playing field. Removing the repayment obligation and expanding access to debt-free funding can reduce the number of women who are forced to take on more than their fair share of student loan debt. 

Colleges and universities could also be required to offer student loan management services for all exiting students who have student loan debt. Schools could take greater responsibility in ensuring that all students are prepared to tackle their debt upon graduation. This would be especially helpful for women as they are more likely to default on their student loans. 

The U.S. Department of Education could make the process of enrolling in income-driven repayment plans easier. These repayment plans can help mitigate some women’s financial difficulties. The Department could also make the student loan forgiveness application and requirements more intuitive. 99% of forgiveness applications are denied mostly due to incorrectly filed forms and not meeting all the requirements to receive forgiveness. Many women work in the public sector, qualifying them for student loan forgiveness. So making forgiveness more achievable means more women are able to pursue financial freedom from student loan debt. 

What can women do to better manage their debt?

Around 37% of women reported not having the same understanding of how to pay off student loans, as compared to 20% of men, according to a survey done by the AAUW. One way women can advocate for better financial wellness and awareness is simply by talking about it! Talking and asking questions can enhance financial knowledge and confidence: Seek advice and the resources available to pay down student loan debt, ask for a raise, go for a higher paying job, negotiate a salary offer or increase, and empower other women to do the same. 

Actionable items for women to better manage their student loan debt:

– Avoid costly for-profit colleges; consider attending an in-state public university

– Apply for grants and scholarships

– Research the repayment and forgiveness options available to you

– Don’t default on your student loans! If you do default, there are steps you can take to slowly make your way out. Contact your loan servicer to be placed on an income-driven repayment plan. 

What’s next?

Despite the odds and obstacles, women are going to school more than men (women represent 56% of college students), women are graduating at higher rates (63 vs. 57 percent, overall 6-year graduation rate), and more women are pursuing graduate studies. It is clear women need equal opportunities and resources to pay for school and to repay their student loans. Addressing the problems as to why women owe so much more student loan debt than men is the first step. Next, we as a society need to execute on the solutions needed to promote financial equality and empowerment for women.