Student loan debt is lowest in the nation

Utah's college student loan debt is the lowest in the country, according to a study by the Project on Student Debt.

The nonprofit group based in Berkeley, Calif., also found that states with the highest cost of living do not necessarily have the highest levels of student loan debt.

According to the project's Web site, about two-thirds of recent graduates carry student loans; their average debt has increased more than 50 percent in the past decade, after accounting for inflation. Student loan payments can hamper a graduate's ability to save for homes, families, businesses and retirement, the project said on its Web site.

"Student loans are here to stay, but right now there is no assurance that students can use these loans for their education without risking their financial future," Robert Shireman, executive director of the project, said in a telephone interview.

The report, released last week, is based on data from more than 1,400 four-year colleges and universities for the Class of 2005 and is weighted by campus enrollment and the proportion of graduating seniors with debt. It found the average student loan debt nationwide ranged from a high of $22,793 for graduates in New Hampshire to a low of $11,709 in Utah.

Those weighted averages combine debt of students graduating from public and private nonprofit institutions. When separated, Utah still holds the lowest debt load in the country: $11,067 for public university graduates, vs. $23,198 in Iowa; and $13,309 for those exiting private institutions, compared to $32,504 for Arizona graduates.

None of the states where the cost of living is high, like California, New York, Hawaii and Alaska, made the top 10 for overall student debt levels. Only one, New York, made the top 20. Instead, the report found that the five states with the highest student debt were New Hampshire ($22,793), Iowa ($22,727), North Dakota ($22,682), Rhode Island ($20,798) and Pennsylvania ($20,775).

The report acknowledges that actual student debt could be higher. Data used in the analysis were reported by institutions responding to a questionnaire from the Thomson Peterson's Undergraduate Financial Aid and Undergraduate Databases, the report states.

Statewide averages reflect student loans taken out by students while at the institutions; borrowing of transfer students is not included, nor are private loans not handled by campus financial aid offices.