Demographic Predictors of Accrued Undergraduate Federal Student Loan Debt

This study sought to determine which demographic variables (student gender, age, race, family income, dependency status, and parental level of educational attainment) best predict total accrued federal student loan debt for undergraduate degree recipients attending a four-year public Midwestern United States research university. The sample consisted of 1,880 first-time enrolled, full-time undergraduate students who matriculated in August 2009 and borrowed their first federal student loan during the first year of enrollment. Data was obtained from the Free Application for Federal Student Aid (FAFSA), institutional federal student loan, enrollment, and graduation data and analyzed through the graduating class of May 2015. A multiple regression analysis for research question one generated a four-factor model: Family Income, Minority Status, Father’s Level and Mother’s Level of Educational Attainment were significant predictors of total accrued federal student loan debt upon graduation. A logistic regression analysis generated three models based on total accrued federal student loan debt upon graduation above/below $10,000, $20,000, and $30,000. The $10,000 model indicated one significant predictor, Mother’s Level of Educational Attainment. The $20,000 model indicated two significant predictors, Family Income and Mother’s Level of Educational Attainment. The $30,000 model indicated three significant predictors, Family Income, Minority Status, and Father’s Level of Educational Attainment. Research question two examined differences in total federal student loan debt between four-year or less and more than four-year undergraduate degree completers. An independent samples t-test analysis revealed a significant difference in total accrued federal student loan debt for degree completion within a four-year time frame. Research question three examined differences between undergraduate degree completers and non-completers in the amount of federal student loans borrowed during each enrollment year and in total. An independent samples t-test analysis revealed that degree completers borrowed significantly less federal student loans than non-completers during year one of enrollment, but significantly more in years three, four, and five. The federal student loan total borrowed between degree completers and degree non-completers was also significant. An ANCOVA analysis revealed that degree completers borrowed significantly more federal student loans than non-completers when controlling for number of years enrolled. Practice and policy implications and recommendations regarding the administration of non-repayable financial aid (scholarships and grants), individualized financial aid/student loan advising/counseling, college curricular initiatives, institutional/federal financial aid processes, and student retention are provided