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Women student debt

Why Women Hold 2/3rd of the Nation’s Student Debt

Conquer your student debt. Refinance now.

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The issue of student debt has been widely covered in the press, and rightfully so – one out of five Americans holds student debt and total outstanding student loan debt is still growing. One facet of the student debt issue which has received less attention so far is the disproportionate impact of student debt on women.

While women make up 58% of graduates with Associate’s, Bachelor’s, Master’s, and Doctorate’s degrees in 2019, they hold an even larger share of the outstanding student debt. Women hold about 65% of the overwhelming $1.6 trillion in student debt in the US.

As a woman, and General Manager of Student Loan Refinancing at Earnest, I wanted to learn more about the root causes: Why do women carry a disproportionate amount of the nation’s student debt? More importantly, why isn’t there greater public awareness of this issue and a conversation about ways to address it?

Women Take on More Debt for School

The American Association of University Women (AAUW) reviewed the federal loan data and uncovered that “41% of female undergraduates took on debt in 2015–16 (the latest figures available) compared to 35% of male undergraduates.”

In addition to more women having student debt, were women also taking out larger loan amounts than men?  As it turns out, yes.  Women take on more debt than men at almost every degree level and type—from Associate to Doctoral degrees and across institution types. From the same AAUW study, “upon completion of a Bachelor’s degree, women’s average student debt is about $2,700 greater than men’s, and black women take on more student debt on average than do members of any other group.”


Knowing that women are taking on more debt to earn a college degree is an important insight, but I wanted to find some clear reasons why this happens.

More Advanced Degrees are Awarded to Women than Men

Not only do more women enroll and finish their undergraduate degree than men (63% of women completed a bachelor’s degree within 6 years compared to 57% of men), but they also continue their education at a higher rate.

This makes a difference in how student debt is distributed by gender because a significant percentage of outstanding student debt is held by those who pursued graduate degrees. According to the Center for American Progress, graduate programs account for 40% of federal student loans issued each year. In the most recent year recorded on graduate degrees awarded, 574,498 master’s/doctorate degrees were earned by women compared to 411,538 master’s/doctorate degrees earned by men – that is, women earned 40% more of the graduate degrees.

Higher enrollment in for-profit institutions

One of the other reasons is higher enrollment in for-profit institutions. Women represent 63% of for-profit college students and only 55% of public four-year college students. And the average tuition bill for a for-profit college is two times higher than for a public college ($16k vs. $8k respectively).

Unfortunately, in addition to a higher tuition bill, for-profit institutions also have the lowest graduation rate among secondary education programs. In 2017, the average six-year graduation rate among for-profit colleges was only 21%–compared to 60% at public institutions and 66% at private nonprofit schools.

Graduating and actually earning your degree is one of the biggest factors in being able to pay back your loans. Student loan borrowers who complete college are more likely than non-completers to begin paying down their debt right away and have at least 20% higher repayment rates at every level. Students who leave school after investing in their education and taking on debt, but don’t have a degree to improve their earnings potential, may feel like they have taken a step back, rather than a step forward.

Lower Family Contribution

Another factor that leads to higher student debt for women is lower family contribution to their cost of education. While this might not be the case in every household, a 2017 survey by T.Rowe Price showed that the parents of all boys were saving more and willing to spend more on their kids’ college education than parents of all girls. 50% of parents with only boys had started to save money for their college education, compared with 39% of parents who had only girls.

This study is just one, but it could point to biases that families might not even realize they have, and how they impact life-long earnings. Very few students pay for their education entirely out of pocket. The smaller the family contribution, the more the student will have to rely on alternative funding options like financial aid, scholarships–and loans–to cover the cost of their education.

The Gender Pay Gap’s Impact on Borrowing and Repayment

The vast majority of current students – 85% – work while enrolled in school, according to an HSBC surveyFemale students who work will on average earn lower wages than their male peers and, as a result, will cover a smaller portion of their tuition bills. This may add to what they will need to borrow each semester. While the gender pay gap is less prominent among young workers, it accelerates over time:


After graduation, the gender pay gap limits the economic resources women can dedicate to student debt repayment. Earning 85 cents on a dollar compared to what their male peers earn, female borrowers will have less to put towards student loan payments. An AAUW study found that while men pay off 13% of their debt a year, women are able to chip in just 10%. Taking longer to repay student debt also means that women pay more interest over the life of their loans.

So What Steps Can I Take?

Many agree that further education is a valuable asset, and taking on debt for school may be a necessary investment to earn a degree. So what can we do to ensure that debt doesn’t impact one gender more than another?

Contribute to pay equity

This is something that makes sense for individuals with or without student debt to work towards. Get involved in advocacy initiatives that aim to eliminate the gender pay gap so all genders have the same income opportunity.

If you are an employer or a hiring manager, take a critical look at the compensation levels for men and women in your company or on your team. Can you do more to reward all your team members fairly? If you are an employee, do you know if you are paid fairly compared to your peers? You can gather information on the compensation for roles similar to yours through online sources, recruiters, and friends or even colleagues who work in similar jobs. If you are not being paid at the same level as your peers, then make a case for a higher salary. Making sure you are fairly compensated is an important investment in your long term financial health.

Educate yourself and then pass on what you learn

The Global Financial Literacy Excellence Center at George Washington University has found that women have lower confidence in financial matters – sometimes simply because they feel less knowledgeable than their male counterparts (even if that isn’t the case).

Think of debt repayment as a side-hustle. If you put in some time to optimize and learn more about the best strategy for repayment, you might see higher returns. There are tons of debt repayment options out there, from federal programs like PSLF, to refinancing your debt to a lower rate.

Once you know more about your student loans and financial well-being, pass this information on. Participate in mentorship programs for those still in school and for recent grads to help with their educational choices and career development. Teach them the tools to build a strong financial foundation earlier in life.

What Earnest is Doing

Earnest treats clients equally irrespective of gender. Similar to other lenders, we comply with the Equal Opportunity Credit Act, and do not collect clients’ demographic information. Our team is passionate about helping women reduce the student debt burden and is doing that by raising awareness of the issue, taking into account holistic customer situations, not just their FICO score and income, and providing financial education to all borrowers. For example, our blog covers issues that disproportionately affect women like managing student debt as a stay at home parent and gender imbalance in investment savings and net worth.

Earnest’s mission is to empower people with the financial capital they need to live better lives. No one should regret their education because of the debt repayment journey it takes them on.

By Lena Chukhno and Carolyn Pairitz Morris

Disclaimer: The opinions expressed by the author are not necessarily those of Earnest.

Conquer your student debt. Refinance now.

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Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.