CivicScience is continuously tracking the impact of student loan payments on consumers. For even deeper insights on the subject, get in touch.
Last week, the Supreme Court struck down President Biden’s student loan forgiveness plan. In a 6-3 vote, the majority ruled that the Biden administration overstepped its legal authority in providing up to $20,000 in federal student loan forgiveness per borrower – and more than $400 billion in debt forgiveness overall.
CivicScience’s always-on InsightStore constantly tracks student loan sentiments, from concerns about repayment to what borrowers intend to cut back on with payments set to resume in October. According to the latest data, borrowers reporting they’re ‘very concerned’ about paying back student loans reached 27% in June – just below the highest level since tracking began last August. Sixty percent of borrowers were at least ‘somewhat concerned’ about paying back student loans in June, up five percentage points from August.
Recent CivicScience data has shown how anticipated spending in different industries and even individual brands stand to be impacted by the resumption of student loans. How will borrowers adjust their major financial plans in light of the Supreme Court decision, such as purchasing a car or home or even plans to get married and start a family?
Among U.S. adults with student loan debt, 46% say that student loan repayments are likely to cause them to delay at least one of six major areas of financial investment. Over one-quarter will delay their plans to put money into savings and investments (26%), and 24% will put other debt payments (credit, mortgage, etc.) on hold for the time being. One-in-five borrowers will delay plans to buy a car or vehicle (19%), and nearly as many borrowers will put homebuying on hold (17%). A smaller, but still significant percentage of borrowers plan to delay life milestones, such as getting married (8%) or starting a family (7%).
Three-quarters of student loan borrowers aged 18-34 claim they’ll delay at least one of these major financial investments – with increases in every individual category from all borrowers. They’re 10 percentage points more likely to say they’ll delay car (31%) or house (27%) purchases than all borrowers. Although, putting money into savings and investments still ranks as the top category (35%) they plan to deprioritize with loan payments set to resume.
Some more unexpected student loan insights:
- More than half of all borrowers at least ‘somewhat concerned’ about paying back student loans have used buy now, pay later programs before – and 21% of those ‘somewhat concerned’ intend to use one in the future.
- Borrowers ‘very concerned’ about being able to pay back their student loans are overwhelmingly the most likely to report being ‘very concerned’ about their current employment situation in the past six months (32%, compared to 17% of those ‘somewhat concerned’ about student loans).
- Student loan borrowers who are ‘very concerned’ about making payments are 9 percentage points more likely to be Paramount+ users than those who are ‘not at all concerned’ (55% versus 46%).
Want even more insights into how student loan repayment will impact your specific brand and consumers? Book a meeting today, and unlock a free month of premium content access.