Debt Burden of Non-Completers: Alternative Measures of Debt

1
Debt Burden of Non-Completers Alternative
Measures of Debt

• Laura Horn
• 30th Annual Student Financial Aid Research
  Network Conference
• Portland, OR
• June 20-21, 2013

2
Purpose

• Expand on previous Debt Burden of Noncompleters
  analysis
• Highlight value of new transcript data for
  analysis of debt and cost

3
Background Increase in student debt
SOURCE http//www.businessweek.com/articles/2012-
09-06/student-loans-debt-for-life
4
Who is counted Completers and noncompleters
2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
5
What is measured Federal student loan debt
measures (Stafford, Perkins) 2009

• Ever borrowed
• Cumulative amount borrowed
• Monthly debt burden
• Debt per credit

6
Ever borrowed 2003-2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
7
Cumulative amount borrowed 2003-2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
8
Loan status 2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003-04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
9
Employment status 2009 Percent working
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
10
Monthly debt burden 2009Loan payments as
percent of monthly earnings (median)
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
11
Debt per credit 2009Amount borrowed per credit
completed
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
12
Credits completed vs. attemptedRatio of credits
completed to credits attempted 2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
13
Total credits earned 2009
SOURCE U.S. Department of Education, National
Center for Education Statistics, 2003/04
Beginning Postsecondary Students Longitudinal
Study, Second Follow-up (BPS04/09).
14
Noncompleters penalty

• Compared to completers
• Higher default rates
• Higher unemployment and lower earnings
• Borrow more per credit
• Debt burden nearly as high as completers without
  earnings premium of credentialimmediate
• Expect debt burden to be higher long-term
• Academic outcome
• Some PSE, no degreereached the half-way mark in
  number of credits earned

15
Future research using transcript data

• Analyze debt and cost at the credit and course
  level 
• Investigate return on investment to some
  postsecondary education at course level
• As on-line delivery (e.g. MOOCs) and
  competency-based learning assessments become more
  common, track the cost of credits
• As more SLDS come on line, track noncompleters
  with threshold numbers of credits and create
  incentives to return

16
Sources of Data

• NCES 2013-155 Federal Student Loan Debt Burden
  of Noncompleters (Wei and Horn)
• NCES 2013-151 An Overview of Classes Taken and
  Credits Earned by Beginning Postsecondary
  Students (Radford and Horn)
• PowerStats (NCES DataLab) Beginning college
  students in 2003-04, followed through 2009
  (BPS2009)

17
More information

• Laura Horn
• Director, Postsecondary Education Research and
  Analysis
• RTI, International
• lhorn_at_rti.org