Forget credit card debt. The newest problem is student debt.
The Federal Reserve of New York released a new analysis that shows that student debt reached $870 billion in the U.S., according to the Chicago Tribune. Credit card debt is at $693 billion, which is $177 billion less than student loans.
But the student debt total isn’t because of an increase in students.
Recent data reveals that nearly 80 percent of Americans held credit cards in 2008, compared to the 15 percent who now hold student debt, according to the Chicago Tribune.
More than 1 in 4 of the 37 million student loan borrowers are past due on their balances.
Experts are becoming concerned that this might be similar to the mortgage crisis.
"Even though most college students are getting jobs, they’re not the same professions or not at the same rates that people had anticipated," Mick Swartz, associate professor finance at USC, told NBC Los Angeles.
A survey by the National Association of Consumer Bankruptcy Attorneys indicates that more than 80 percent of bankruptcy attorneys saw the number of potential clients burdened by student debt “somewhat or significantly” increase over the last three to four years, according to NBC Los Angeles.
The problem could be caused by an increase in tuition rates.
College tuition inflation rates have ranged from about 6 to 9 percent annually over the past 50 years, according to Yahoo! Finance. This makes college progressively harder to pay, forcing more students to take out loans.
With an economy not providing jobs for college grads, experts are concerned that more and more college grads will be unable to pay their debts.