The Mental and Physical Toll of Student Loans

As the use of student loans escalates, so too do conversations about the possible ramifications of increasingly high debt for young Americans. It's widely known that inability to pay student debt can result in a host of problems, like damaged credit or garnished wages, but a new study from the University of South Carolina suggests that some ill effects, such as increased stress levels or feelings of depleted health, can surface just from accumulating student-loan debt.

It’s been well documented that financial strain can have measurable mental and physical effects. A 2013 study published in Anxiety, Coping and Stress, for instance, found that “those with greater financial strain perceived more stress, had more symptoms of depression, anxiety, and ill-health.” And significant or growing debt, can be a major cause of overall financial stress.

The study from the University of South Carolina looked at the link between student-loan debt and psychological function in 25-to-31-year-olds and currently enrolled students. Researchers factored in issues like what type of college they attended (two-year versus four-year), what degree was earned, and how wealthy their families were, in order to assess what the consequences of climbing loan totals might be, and what factors might mitigate any mental and physical consequences.

It’s no surprise that the study found that using debt to finance a college education can take its toll. “Cumulative student loans were significantly and inversely associated with better psychological functioning,” according to the results. That means, generally speaking, student-loan debt was not great for the mental health of study participants.

But with tuition prices soaring—according to the study, the price of higher education in the U.S. has increased by 250 percent in the past three decades when accounting for inflation—most students have to borrow money to pay for school. According to the Project on Student Debt, in 2013 seven out of 10 graduating college seniors were leaving school with student loans, which averaged $28,400.

Northwestern University published a 2013 study, which found that higher levels of relative debt—that’s relative to household assets—were particularly problematic, causing subjects to report higher levels of stress, depression, and poorer self-reported general health. Feelings of significant indebtedness also raised diastolic blood pressure, which can increase the risk of hypertension and stroke. Though the Northwestern study found consistent correlations between higher relative debt and poorer mental and physical effects, there were some instances where higher absolute debt was actually associated with better self-reported health. That could be because sometimes certain debt, like, student loans, can serve as a catalyst for obtaining higher socioeconomic status, which would ultimately help individuals, the study suggests.

That may be why students from poorer backgrounds with higher cumulative levels of student-loan debt in the study from the University of South Carolina performed better when it came to mental health. This could suggest that among students with poorer families, higher student-loan debt reflects an improving social standing, according to researchers. Researchers also postulate that it might also mean that poorer students who are able to attend college, an accomplishment more difficult to achieve for many students in lower-income brackets, possess personality traits that may make it easier for them to deal with the strain of student loans. The researchers write: “Those who are able to enroll in college despite their early-life disadvantages may be in better mental health or possess personality characteristics that increase their odds of attending college, such as being future-oriented or highly motivated.”

As college becomes an increasingly expensive proposition and the level of student loans has been rising, some research shows that college is still a good investment, and for many, the best hope for future success. And though loans could potentially be bad for you during early adulthood, other studies have found higher levels of education may lead to better self-reported mental and physical health in the long run.