DENVER (KDVR) — Student loan repayments are resuming at the end of the month, leaving Coloradans with above-average debt levels to come back to earth on their spending.
Student loan payments are expected to restart at the end of August at the latest, including for many borrowers who graduated during the pandemic and have never made such payments before. Student loan servicers are in a tough bind, dealing with reduced staff as they prepare for the unprecedented situation of 44 million borrowers returning to payments.
Colorado’s average student debt levels are the nation’s 16th highest, just below those of Oregon and above those of Alabama. The average student loan debt in the Centennial State is $36,169. In total, there is $27.3 billion worth of student loan debt among Colorado’s 754,800 borrowers.
With average payments ranging from $200 to $500 a month, the restart promises to have a range of economic consequences.
Having been on hold for three years, student loans will immediately outpace all the other cost of living increases Americans have absorbed in a hyperinflationary climate. Combined with other inflation measures, student loan reinstatement could add another $1,000 to household bills, according to Consumer Price Index data and updated rental information from ApartmentList.