(The Center Square) – A WalletHub study released Wednesday ranked five Midwest states in the top 20% nationwide for overall student loan debt.
Ohio, Wisconsin, Minnesota, Iowa and Michigan were ranked in order from 13th to 17th for overall highest student loan debt. Only two other Midwest states, Indiana (21st) and Illinois (30th), were ranked in the bottom 30 of states.
Overall scores were determined by averaging 11 key metrics, which determined two categories – Total Overall Debt and Grant and Student Work Opportunities. In the first category, some states – Ohio, Michigan, and Wisconsin – scored lower for total student loan debt at, respectively, 17th, 16th and 19th. Minnesota was ranked ninth while Iowa was ranked 12th.
In the Grant and Student Work Opportunities category, Minnesota was ranked 50th; Wisconsin 20th; Ohio 14th; Michigan ninth; and Iowa 37th. Indiana was ranked 23rd, and Illinois ranked 39th.
The top five states ranked for overall debt are, in order: West Virginia, Pennsylvania, South Dakota, New Hampshire, and Mississippi. The bottom five states ranked for overall debt are, in order: Utah, District of Columbia, California, Washington, and New Mexico.
The report coincides with President Joe Biden’s announcement the same day that the U.S. Government would forgive $10,000 of student loan debt for each debtor earning less than $125,000, which the Committee for a Responsible Federal Budget said could cost taxpayers more than $200 billion. All told, WalletHub estimates the government is cancelling $15 billion in student loans, while the total outstanding U.S. student loan balance as of the first quarter of 2022 was about $1.16 trillion, or an average of $37,000 owed by 43.4 million borrowers.
Pell Grant recipients will see their student-loan debt reduced by a total $20,000. Additionally, the plan announced by Biden will cap loan repayments at 5% of borrowers’ income, and extends the pause on student loans instituted during the COVID-19 pandemic through Dec. 31 of this year.