The Average Indebtedness at Graduation In 2025 [Analyzed]

Ever wonder how much debt the average student carries after graduation? The numbers might shock you.

Student debt has been a national issue for decades, totaling up to $1.8 trillion in the past years, and this isn’t even the end of it. 

A survey shows that 58% of Bachelor’s degree recipients graduate with a student loan, with the figure going up to 78% in some states. 

While these stats do not directly aim to discourage student loans, understanding the average indebtedness at graduation helps you prepare a suitable student loan debt exit plan.

Key Takeaways

• The average indebtedness after graduation is ~$29,000 for a Bachelor’s degree, with higher amounts for advanced degrees. 
• Medicine graduates accumulate the highest debt, averaging ~$202,450.
• Public university graduates generally have lower student debt than private university graduates, often by tens of thousands of dollars.

What Is the Average Student Debt at Graduation

The average student loan debt per borrower stands at approximately $29,000, with the total student loan debt exceeding $1.7 trillion. The total debt has grown by 53% over the past decade.

Based on this, the median student loan debt falls between $20,000 and $24,999, meaning that half of all borrowers owe at least this amount upon graduation. 

While this is the national average, the numbers still fluctuate based on factors like the type of institution, degree level, and geographic location.

For instance, the average student loan debt in 2022 for a Bachelor’s degree was approximately $21,566. 

However, the debt is often higher for graduate and professional degree holders. These students not only borrow more but also contend with higher federal loan interest rates—6.53% for undergraduates and 8.08% for graduate students.

In 2020, Utah reported the lowest average student debt at graduation, at $18,350, while New Hampshire had the highest average student debt, at $39,950. 

Student Debt at Graduation by Degree Levels 

Approximately 67% of students who complete certificate programs graduate with debt, which averages $17,400. Even though these programs are often shorter in duration, many students still accumulate significant debt. 

Among Bachelor’s degree recipients, 54% graduate with student debt, carrying an average of $29,100. This level of debt can influence graduates’ financial decisions as they begin their careers. 

For those pursuing advanced education, 56% of graduate degree holders incur debt related to their studies, averaging $66,000. 

When accounting for remaining undergraduate debt, the average total debt at graduation rises to $71,300, with 73% of graduates having student debt. 

Average Student Indebtedness: Public vs. Private Institutions

Graduates from private nonprofit institutions tend to incur higher debt, averaging $33,800, compared to their counterparts at public institutions, who average $27,100 in debt. 

Tuition fees at private colleges are generally higher than those at public institutions. For instance, during the 2022-2023 academic year, the average tuition at private nonprofit institutions was $38,070, while public four-year colleges charged an average of $10,740 for in-state students. 

High Debt Vs. Low Debt Fields 

While preparing for higher institutions, it’s necessary to understand the cost associated with graduating from your desired field of study. Medicine, for instance, costs more, which explains why medical students graduate with higher loan amounts. 

Graduates in fields such as medicine, law, pharmacy, dentistry, and veterinary medicine often incur substantial debt due to the extended duration of their programs and associated high tuition costs. 

For instance, medical school graduates face an average debt of $201,490, while dental school graduates carry even higher debt, averaging $292,169. In contrast, MBA graduates tend to have lower average debt levels, around $66,300, due to the shorter duration of the program. 

While most medical and law majors have the highest average student debt, fields like engineering and education are on the lower end. 

Student Loan Debt Impact on Post-Graduation Life

While student loans provide access to higher education, the accompanying debt can have far-reaching effects on graduates’ life choices. We’ll quickly consider some. 

• Delayed Life Milestones: A study by the Lumina Foundation and Gallup found that most student loan borrowers have postponed several life events due to their debt. This includes delays in purchasing homes, starting families, or pursuing further education. 

• Reduced Earning Potential: In a bid to quickly pay up loans, indebted graduates may accept jobs that are less related to their degrees and offer limited career potential. This can lead to lower earnings shortly after graduation.

• Financial Stress: The pressure to meet monthly loan repayments often contributes to financial stress among graduates. This stress can adversely affect mental health and cause depression. 

• Impact on Further Education: The rising cost of postgraduate education makes it much more difficult for students to attain higher degrees without pulling out substantial loan amounts. Even more, the maximum postgraduate loan available often barely covers tuition fees, discouraging students from advancing their studies.  

ROI Analysis: Debt Vs. Expected Starting Salaries 

One approach to ensure you get the best out of your loans is to consider education as an investment and student loans as your investment capital. This approach requires that you calculate how much it would cost you to attain a degree, how much you’ll earn as a starting salary, and how long it’ll take to repay your debt.

Return on Investment (ROI) measures how much a degree pays off compared to the amount borrowed. A higher ROI percentage means a degree provides a better financial return. 

Estimated Time to Pay Off Debt

Assuming a strict repayment plan where 10% of the graduate’s salary goes toward student loan repayment each year, the estimated time required to repay the debt is as such: 

Get Better Insights On Student Loans and Repayment

Higher education remains a valuable investment, yet you must carefully consider the debt-to-earning potential of your chosen degree since you’ll most likely have to repay your debt from your own income. 

At Student Loan Professor, we offer debt consultation packages that consider your financial situation and prepare a solid repayment plan. If you’re wondering about how your chosen degree and income can impact your future student debt, you can sign up for our consultation. 

For more insights on student loans, repayment, and refinancing, check out our blog section. 

Resources

1. US Bureau of Labor Statistics (BLS) — “Education Pays”

2. US Bureau of Labor Statistics (BLS) — “Employment Projections: Education and Training Assignments by Occupation”

3. Federal Student Aid — “Student Loan Debt and Repayment Statistics”

4. National Center for Education — “Student Loan Debt by Degree Level”

5. US Department of Education — “College Scorecard: Debt and Earning Data”

6. Gallup — “Most Student Loan Borrowers Have Delayed Major Life Events”