Student Loan Debt Hits $1.77 Trillion—Dave Ramsey Blames Parents, Not Policies: 'It's Not A Student Loan Crisis, We Have A Parenting Crisis'

America's student loan bill just clocked in at an eye-popping $1.77 trillion, leaving families and policymakers scrambling for answers, according to NerdWallet. But for personal finance expert Dave Ramsey, the culprit isn't just broken systems — it’s parenting. 

"It's not a student loan crisis, we have a parenting crisis," Ramsey said on a 2019 episode of "The Dave Ramsey" show, arguing that inadequate financial education at home often leads to financial struggles later in life.

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Ramsey's remarks mirror the message in his 2021 documentary "Borrowed Future," where his team investigates how young adults fall into massive debt traps before they even turn 20. It also explored how colleges encourage easy access to loans, but he argues that it’s ultimately up to families to question and plan better — avoiding the blind signing of massive obligations.

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Student Loan Numbers Reach New Heights

According to the Education Data Initiative, more than 42.7 million Americans have student loans, with the average borrower carrying a balance of around $38,000. The outstanding federal student loan balance totals $1.693 trillion.

To put it in perspective, that figure ($1.63 trillion) surpasses the annual GDP of some mid-sized nations. According to Bankrate, it now makes up about 9% of all consumer debt in the U.S. The Education Data Initiative reports that this financial burden has increasingly squeezed young professionals, with monthly payments often eating up to 10% of their income.

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Ramsey's Parenting Callout

Ramsey responded to a parent seeking advice on helping a wealthy, budget-averse daughter during an April 17 episode of "The Dave Ramsey" show.

Co-host John Delony weighed in, explaining, "Your daughter is acting like an 18-year-old," while Ramsey doubled down that the real problem starts with parents failing to model financial responsibility early. 

Through his lens, parents should be the “first line of defense” — teaching saving, budgeting, and debt avoidance years before the college application process even begins.

See Also: If You're Age 35, 50, or 60: Here’s How Much You Should Have Saved Vs. Invested By Now

Collections Resume Amid Big Policy Shifts

The timing of Ramsey's statement wasn't random. On April 21, the Department of Education announced that collections would restart for borrowers who are in default. 

This marks a major shift after the original student loan payment pause, created under the CARES Act in March 2020, was extended through the Biden administration. As the Office of Federal Student Aid outlined, borrowers who had defaulted will soon face wage garnishment and tax refund seizures once again.

Then, in January, the Biden administration also celebrated canceling $189 billion in student loans for over 5 million Americans. Adding to the urgency, over 5 million borrowers in default will face renewed collections starting May 5, including wage garnishment and tax refund seizures.

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