The Big, Bad Impact of Student Loan Debt

By on June 1, 2012

By Penelope Lemov –

A little–perhaps a lot–of sympathy may be in order here. Our children and their friends are coming out of college and graduate school drowning in debt and buffeted by woes that ripple out from that. “It’s a very different world than 20 years ago” says Nancy Molitor, a clinical psychologist who practices in the Chicago area. “Parents in their 50s and 60s don’t have any idea of the stress their children are under.”

There’s some $1 trillion outstanding student debt floating around out there. Americans now owe more on student loans than they do for auto loans or on credit cards.

fall scents for your home

Molitor, who’s also Public Education Coordinator for the American Psychological Association, saw the face of that debt up close and personally when she was a speaker at a seminar for graduate students in psychology. She asked the 150 students attending the seminar for a show of hands: How many of them had debt from college and graduate school? All hands went up. She then broke it down: How many had debt of $50,000 or less. Roughly 1/3 raised their hands. How many had debt of $100,000 or less? Another 1/3 raised their hands. When she upped it to $150,000, another 1/3 put up their hands. When she asked about debt above $150,000, ten hands shot up.

That’s a lot of money to owe when you’re getting out of graduate school and can’t find a job–or can’t find one that pays enough to start whittling down that debt. But psychology isn’t the only field where young people are under stress. In the aftermath of the Great Recession, opportunities for college and graduate school graduates have tightened. In the past two years, thousands of teachers and other government employees have been being laid off.

It is no wonder, Molitor says, that a lot of the young adults she sees feel “bamboozled.” And a lot of them, she adds, turn their anger on their parents–for sheltering them from the harsh realities, for leading them to believe that doing well in college would mean a good job, a worthwhile career, a house and a life style similar to their parents. “They feel let down,” she says.

It’s also one of the reasons they’re delaying marriage and are unwilling to start their own families. “These young adults feel like the debt is saddling them,” Molitor reports. “It affects every decision they make. When you have debt you can’t take risks.”

It’s a point Daniel Burrus, futurist and author of Flash Foresight, riffs on as well. As he sees it, kids in high school and college aren’t being guided properly. They’re going to college and majoring in things, like philosophy, that will never lead to a job. His solution: better education about school debt versus level of diploma versus job opportunity.


Penelope Lemov is the founder and editor of a blog on parenting adult children, This article is adapted from that website.

About Penelope Lemov

As Penelope Lemov, I'm a senior editor and financial columnist for a national magazine on state and local government. I write two monthly columns on finance and tax policy, both of which are posted at In my more personal life, I’m known as Penny. I have one husband (of 45 years) and two grown children, both of whom have started families of their own in cities far from the family home and from each other. The grand total is four grandchildren, one grandpup and a lot of travel to visit them. Their lives and the way our lives intersect with them are the spark behind my blog, Parenting Grown Children: What Dr. Spock Forgot to Tell Us.

Leave a Reply

Your email address will not be published.

The Big, Bad Impact of Student Loan Debt