U.S. Student Loan Debt Hits $2.19 Trillion—Here's Why Experts Say Borrowers Shouldn't Panic Yet

The United States continues to grapple with the consequences of student loan debt through the beginning of 2025. According to a report from the Education Data Initiative, total outstanding debt in student loans has hit a record-high value of $1.77 trillion, combining federal and private, for more than 42 million borrowers.

The average debt of a borrower of federal students is about $37,853, and recent studies indicate Black borrowers continue with disproportionately high amounts of debt, compared with their white and Hispanic peers–a key indicator of lingering racial wealth gaps.

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In January, the Biden administration announced another $4.23 billion in student loan forgiveness, helping about 150,000  borrowers, according to the Department of Education. That brings the total relief under Biden's presidency to around $183.6 billion, reaching nearly 5 million people, according to Reuters. 

Yet despite the efforts, big-ticket student loan forgiveness has since hit some real roadblocks: The Supreme Court previously axed a plan to cancel up to $20,000 per borrower, ruling it beyond an executive’s authority.

And while the Saving on a Valuable Education plan—which aims to provide more manageable repayment options—was set to offer relief, it's currently stuck in legal battles. 

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With the 2024 presidential election behind us, student loan policies are likely to shift again. President Donald Trump has signaled plans to roll back loan forgiveness programs and possibly privatize the federal student loan system. 

He's also suggested dismantling the Department of Education, which has many higher education advocates on edge. 

“We are concerned about ways that there could be a deconstruction of the ability for the Department of Ed to do its work, including the administration of Title IV programs, including student loans," said Yolanda Watson Spiva, president of Complete College America. 

Looking at the numbers, California has the highest number of federal student loan borrowers—about 4 million residents—per federal student aid data. 

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Meanwhile, for borrowers who have fallen behind, collections are set to restart after a five-year COVID-19 pause, meaning wage garnishments, seized tax refunds, and even Social Security benefit reductions could be back on the table. 

With so much uncertainty, experts stress that borrowers should stay informed and plan ahead. Betsy Mayotte, president of The Institute of Student Loan Advisors, advises: “Educate yourself on your options now. Historically, no changes have been made retroactively, so it's unlikely that borrowers will lose existing benefits—except for the SAVE plan." 

Despite the chaos, higher education remains key to economic stability, with over 70% of U.S. jobs requiring some form of post-secondary education by 2031, according to Georgetown University Center on Education and the Workforce.

For families thinking ahead, 529 plans, or education savings accounts, and scholarships are smart ways to prepare for rising tuition costs. As Watson Spiva said, conversations about financial strain should go beyond just groceries and gas: “If we're talking about affordability, the cost of college must be part of the conversation."

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