Introduction

Women carry a greater percentage of all student debt compared to men and the average debt load per borrower is higher for women than it is for men. 

This post will detail some reasons that women carry more educational debt than men and the impact of this debt.  It will also suggest strategies and policy implications to help women keep educational debt within reasonable limits.

Background

Women’s rate of college attendance has significantly increased over the past half century. In 1970, about 41% of undergraduate students were women. In 2020, 59% of undergraduate students were women. Additionally, women are more likely than men to complete their degree. 

Women tend to carry a slightly higher average debt load than men for educational borrowing at all levels, from certificates to bachelor’s degrees. The reasons for this are not well articulated in the literature, but possible explanations include:

• Less familial support to pay for women’s education relative to men’s
• Higher likelihood that women start college later relative to men, enabling them, at age 24 plus, to take larger federal loans. This may be because of child care responsibilities and delaying college attendance or attending either part time or with gaps, due to work and child care responsibilities. Women undergraduates are twice as likely as men undergraduates to have dependents. (Hanson)

Considerations for educational debt

Taking on reasonable debt to complete an undergraduate degree is generally worth it, with caveats. (Torpey)

The return on an investment on attending college is great:

• The 20-year return is 38% for a bachelor degree
• The lifetime return is 288% for a bachelor degree
• Unemployment percent decreases with level of degree
• People with bachelor degrees and higher have better than average health outcomes

Therefore, if the decision is to attend college by taking on reasonable debt or to not attend college, the advice would be to attend college with reasonable debt, due to better lifetime outcomes.

However, there are several critical considerations to evaluate before a prospective student determines which college to attend and what to study, if they are going to accrue debt for their education. While the data to evaluate these issues is publicly available, college counselors can help students find and evaluate this information. Considerations include:

• What is the future expected salary of occupations linked to the major field of study? What are the future labor market employment growth projections of these occupations?
• Using this projected monthly salary, what would the monthly loan payment be from the amount of expected debt? Would this be affordable in the budget, given other expenses? 
• Do the colleges under consideration have high four year graduation rates? Do they have large endowments and offer generous merit-based grant awards? Do they meet full financial need with and without loans?
• Is it worth considering colleges outside of the immediate geographic area to find those with better outcomes?

Women still are paid less than men, with all else being equal. Much of the wage discrepancy can be explained by both occupational and industrial segregation, meaning female-dominated occupations typically pay less than those dominated by males. This is true across industries as well. Some portion of the wage discrepancy cannot be explained by occupational and industrial segregation or other factors such as educational level and experience. This is defined as employment discrimination. (“The Gender Wage Gap: Extent, Trends, and Explanations”)

Because of this, women’s loan repayment budgets are often more difficult due to lower salaries relative to men.  When dependents and child care costs are added to the budget, it is extremely difficult to pay off even average educational debt. (“Deeper in Debt: Women & Student Loans – AAUW : Empowering Women Since 1881”)

Actionable advice for women

When preparing for college attendance and discerning future areas of studies and careers, students should consider:

• High future employment projected growth within occupations and industries
• Higher than average wages of projected fields. Science, Engineering, Mathematics, Computer Science fields tend to have higher than average earnings. 
• In a field with average to below average earnings, carefully consider the cost of your college education to achieve a degree in that field. Make choices to keep the cost low.

Managing the cost of college

• Look at pathway programs from community college to university that guarantee admission. Reduce costs by starting at a community college with a pathway program.
• Complete the net price calculators on college websites for different colleges that you are considering. Often, costs will be different than what you expect due to merit awards, state reciprocity arrangements for in-state tuition, and no-loan need-based aid.
• Pay careful attention to four year graduation rates, advising capabilities, and outcomes for each college and major you are considering.
• Try to keep total educational borrowing, if needed at all, to no more than $20,000-$30,000 and try to keep to loans offered through the federal or state government, instead of private loans. 
• If seeking an advanced degree, beyond a bachelor’s degree, look for opportunities for funding which waive tuition, such as teaching or research assistantships. 
• Many occupations offer loan forgiveness under certain circumstances, such as working in a high-demand field or in rural areas. Explore and pursue these options to have loans forgiven. (Hanson)

Advocacy

We can all raise our voices to try to influence policy that will help all students effectively manage the cost of higher education. Suggestions from AAUW include (“Deeper in Debt: Women & Student Loans – AAUW : Empowering Women Since 1881”): 

• Protect Pell Grants and increase funding so they cover a larger percentage of college costs
• Support repayment approaches that take into account the reality of wages, housing costs with dependents, and child care costs
• Address child care costs while students are attending college
• Work to eliminate the pay gap and occupational segregation
• Support data transparency for educational consumers
• Provide more robust pre-loan counseling and career counseling

Resources

AAUW. “Deeper in Debt: Women & Student Loans Washington, DC: AAUW, 2021 update. https://www.aauw.org/resources/research/deeper-in-debt/. Accessed 15 February 2025.

Blau, Francine D and Kahn, Lawrence M. “The Gender Wage Gap: Extent, Trends, and Explanations.” jJournal of Economic Literature, 2017, v 55, no 3, p 789-865. https://www.aeaweb.org/articles?id=10.1257/jel.20160995. Accessed 15 February 2025.

Hanson, Melanie. “143 Student Loan Forgiveness Programs (2024): Complete List.” Education Data Initiative, 7 December 2024, https://educationdata.org/student-loan-forgiveness-programs. Accessed 15 February 2025.

Hanson, Melanie. “Student Loan Debt by Gender [2024]: Men vs Women.” Education Data Initiative, 20 June 2024, https://educationdata.org/student-loan-debt-by-gender. Accessed 15 February 2025.

Torpey, Elka. “Education pays, 2020 : Career Outlook: U.S.” Bureau of Labor Statistics, June 2021. https://www.bls.gov/careeroutlook/2021/data-on-display/education-pays.htm. Accessed 15 February 2025.