Ann Arbor, Ypsilanti, has some of the highest student debt-to-income ratios, according to research
YPSILANTI, MI – According to a recent WalletHub study, credit score report, and monitoring website, undergraduate degrees at Ann Arbor and Ypsilanti have one of the highest debt-to-income ratios in the country.
The study, which compared the median student debt to the median income of adults 25 and older with a bachelor’s degree, found that the median student debt load in Ypsilanti was $ 24,661, with residents earning an average of $ 34,448 per year .
The numbers represent a debt-to-earnings ratio of 71.6%, placing it 12th on WalletHub’s list of more than 2,500 cities and the highest-ranking city in Michigan.
Ann Arbor residents have an average debt burden of $ 29,048 and earn $ 47,368 for a rate of 61.32%, the study shows.
Ypsilanti was ranked in the 99th percentile by the study that assigned percentages to each city. Cities with the highest student debt to income ratio received 100 points and cities with the lowest ratio received zero points, according to the study’s methodology.
While student debt at Ypsilanti isn’t that high, people earn less, which translates into a higher student debt-to-income ratio, said Jill Gonzalez, a WalletHub analyst.
According to the National Center for Education Statistics, tuition and required fees for full-time students at Eastern Michigan University for the 2019-20 school year were $ 13,758 for both domestic and overseas students. In the 2018/19 school year, 53% of all undergraduate students at WWU had federal loan support, and the average amount of help received was $ 7,193.
Ann Arbor, ranked in the 97th percentile, has one of the highest per capita student debt in the country, at just over $ 29,000, Gonzalez said. However, the median income of $ 47,368 is average, she said.
At UM-Ann Arbor, only 29% of students received federal student loan assistance, averaging $ 6,089, according to NCES data. For the 2019-20 school year, UM students in the state paid $ 16,540 for tuition and required fees, and that number rose to $ 52,997 for non-state students, according to NCES data.
Overall, Michigan cities are roughly in the middle when it comes to student debt to middle income ratios, on par with states like Florida, Pennsylvania, Oregon, Missouri, and North Carolina, Gonzalez said.
“Only 16 of 83 Michigan cities analyzed are in the 90 to 99% range. This means that only about 20% of them have high student debt, ”Gonzalez said. “By comparison, other states like South Carolina, Georgia, Kentucky, and Mississippi have analyzed nearly 30% of the cities in the same area.”
Other cities in Michigan ranked 90% or more include Oak Park, Inkster, Traverse City, Southfield, Kalamazoo, Hamtramck, Burton, Adrian, Flint, Jackson, Grand Rapids, Niles, Grandville, and Detroit.
The high ratio of student debt to median income puts a tremendous financial burden on these communities and their citizens, Gonzalez said.
“The amount of debt combined with the long grace period is forcing people to delay or even forego other financial goals, such as becoming homeowners, and limiting their ability to save for retirement or other purposes,” Gonzalez said .
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