Skip to main content

Advertisement

SpringerLink
Log in

Student Loans, Health, and Life Satisfaction of US Households: Evidence from a Panel Study

  • Original Paper
  • Published:
Journal of Family and Economic Issues Aims and scope Submit manuscript

Abstract

As student loan debt among US households continues to rise, the resulting debt burden may have consequences for multiple aspects of life, including household health and well-being. Using panel data from 2011, 2013, and 2015 waves of the Panel Study of Income Dynamics (PSID), this study investigated whether student loans are associated with self-reported health, psychological problems, and perceived life satisfaction. The results demonstrate that student loan debt was negatively associated with the life satisfaction and psychological well-being of respondents after controlling for other types of debt, such as medical and credit card debt, assets and income, and a number of other sociodemographic factors. Student loan debt from previous periods was also negatively associated with the health status of Hispanic respondents. The policy implications discussed in this study are relevant in the light of increasing higher education costs and debt burdens in America. The key findings from this study have policy implications for the long-term effects of student loans on life satisfaction, health, and well-being over time.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Adams, D. R., Meyers, S. A., & Beidas, R. S. (2016). The relationship between financial strain, perceived stress, psychological symptoms, and academic and social integration in undergraduate students. Journal of American College Health, 64(5), 362–370. https://doi.org/10.1080/07448481.2016.1154559.

    Article  Google Scholar 

  • Adams, S. J. (2002). Educational attainment and health: Evidence from a sample of older adults. Education Economics, 10(1), 97–109.

    Article  Google Scholar 

  • Adams, T., & Moore, M. (2007). High-risk health and credit behavior among 18- to 25-year-old college students. Journal of American College Health, 56(2), 101–108.

    Article  Google Scholar 

  • Anson, O., Paran, E., Neumann, L., & Chernichovsky, D. (1993). Gender differences in health perceptions and their predictors. Social Science & Medicine, 36(4), 419–427.

    Article  Google Scholar 

  • Archuleta, K. L., Dale, A., & Spann, S. M. (2013). College students and financial distress: Exploring debt, financial satisfaction, and financial anxiety. Journal of Financial Counseling and Planning, 24(2), 50–62.

    Google Scholar 

  • Bricker, J., & Thompson, J. (2016). Does educational loan debt influence household financial distress? An assessment using the 2007–2009 Survey of Consumer Finances Panel. Contemporary Economic Policy, 34(4), 660–677. https://doi.org/10.1111/coep.12164.

    Article  Google Scholar 

  • Bridges, S., & Disney, R. (2010). Debt and depression. Journal of Health Economics, 29(3), 388–403. https://doi.org/10.1016/j.jhealeco.2010.02.003.

    Article  Google Scholar 

  • Britt, S. L., Ammerman, D. A., Barrett, S. F., & Jones, S. (2017). Student loans, financial stress, and college student retention. Journal of Student Financial Aid, 47(1), 25–37.

    Google Scholar 

  • Callender, C., & Jackson, J. (2005). Does the fear of debt deter students from higher education? Journal of Social Policy, 34, 509–540.

    Article  Google Scholar 

  • Callender, C., & Mason, G. (2017). Does student loan debt deter higher education participation? New Evidence from England. Annals of The American Academy of Political & Social Science, 671(1), 20–48. https://doi.org/10.1177/0002716217696041.

    Article  Google Scholar 

  • Cannuscio, C. C., Alley, D. E., Pagán, J. A., Soldo, B., Krasny, S., Shardell, M., … Lipman, T. H. (2012). Housing strain, mortgage foreclosure, and health. Nursing Outlook, 60(3), 134.e1–142.e1. https://doi.org/10.1016/j.outlook.2011.08.004.

  • Chen, R., & Desjardins, S. L. (2010). Investigating the impact of financial aid on student dropout risks: Racial and ethnic differences. Journal of Higher Education, 81(2), 179–208.

    Article  Google Scholar 

  • Chipperfield, J. G., & Havens, B. (2001). Gender differences in the relationship between marital status transitions and life satisfaction in later life. The Journals of Gerontology Series B: Psychological Sciences and Social Sciences, 56(3), P176–P186.

    Article  Google Scholar 

  • Chiteji, N. S. (2007). To have and to hold: An analysis of young adult debt. In S. Danziger & C. E. Rouse (Eds.), The price of independence: The economics of early adulthood. New York: Russell Sage Foundation.

    Google Scholar 

  • Choy, S. P., & Carroll, C. D. (2000). Debt burden four years after college. Washington, DC: National Center for Education Statistics.

    Google Scholar 

  • Cilluffo, A. (2017). Five facts about student loans. Pew Research Center. Retrieved from http://www.pewresearch.org/fact-tank/2017/08/24/5-facts-about-student-loans/.

  • College Board (2017). Trends in student financial aid. Retrieved from https://trends.collegeboard.org/sites/default/files/2017-trends-student-aid_0.pdf.

  • Cooke, R., Barkham, M., Audin, K., Bradley, M., & Davy, J. (2004). Student debt and its relation to student mental health. Journal of Further and Higher Education, 28(1), 53–66.

    Article  Google Scholar 

  • Cornelius, L. M., & Frank, S. A. (2015). Student loan debt levels and their implications for borrowers, society, and the economy. Educational Considerations, 42(2), 35–38.

    Article  Google Scholar 

  • Dannefer, D. (1987). Aging as intracohort differentiation: Accentuation, the Matthew effect, and the life course. In Sociological Forum, 2(2), 211–236.

    Article  Google Scholar 

  • Davidson, P. (2017). Are student loans as big of a problem as people think? USA Today. Retrieved from https://www.usatoday.com/story/money/2017/07/07/student-loans-big-problem-people-think/101842736/.

  • Despard, M., Perantie, D., Taylor, S., Grinstein-Weiss, M., Friedline, T., & Raghavan, R. (2016). Student debt and hardship: Evidence from a large sample of low- and moderate-income households. Children & Youth Services Review, 70(C), 8–18. https://doi.org/10.1016/j.childyouth.2016.09.001.

    Article  Google Scholar 

  • Dickerson, A. M. (2016). Millennials, affordable housing, and the future of homeownership. Journal of Affordable Housing & Community Development Law, 24(3), 435–465.

    Google Scholar 

  • Drentea, P., & Lavrakas, P. J. (2000). Over the limit: The association among health, race and debt. Social Science & Medicine, 50(4), 517–529.

    Article  Google Scholar 

  • Dwyer, R. E., McCloud, L., & Hodson, R. (2012). Debt and graduation from American Universities. Social Forces, 90(4), 1133–1155. https://doi.org/10.1093/sf/sos072.

    Article  Google Scholar 

  • Elliott, W., & Friedline, T. (2013). “You pay your share, we’ll pay our share”: The college cost burden and the role of race, income, and college assets [special issue]. Economics of Education Review, 33, 134–153. https://doi.org/10.1016/j.econedurev.2012.10.001.

    Article  Google Scholar 

  • Elliott, W., III, & Nam, I. (2013). Is student debt jeopardizing the short-term financial health of US. households? Federal Reserve Bank of St. Louis Review, 95(5), 405–424.

    Google Scholar 

  • Federal Reserve Bank of New York. (2018). Quarterly report on household debt and credit. Retrieved from https://www.newyorkfed.org/medialibrary/interactives/householdcredit/data/pdf/HHDC_2018Q1.pdf.

  • Ferraro, K. F., Thorpe Jr, R. J., McCabe, G. P., Kelley-Moore, J. A., & Jiang, Z. (2006). The color of hospitalization over the adult life course: Cumulative disadvantage in black and white? The Journals of Gerontology Series B: Psychological Sciences and Social Sciences, 61(6), S299–S306.

    Article  Google Scholar 

  • Field, E. (2009). Educational debt burden and career choice: Evidence from a financial aid experiment at NYU Law School. American Economic Journal: Applied Economics, 1(1), 1–21.

    Google Scholar 

  • Fitch, C., Hamilton, S., Bassett, P., & Davey, R. (2011). The relationship between personal debt and mental health: A systematic review. Mental Health Review Journal, 16(4), 153–166.

    Article  Google Scholar 

  • Frijters, P., Haisken-DeNew, J. P., & Shields, M. A. (2004). Money does matter! Evidence from increasing real income and life satisfaction in East Germany following reunification. American Economic Review, 94(3), 730–740.

    Article  Google Scholar 

  • Fry, R. (2014). Young adults, student debt and economic well-being. Washington, DC: Pew Research Center’s Social and Demographic Trends project.

    Google Scholar 

  • Gicheva, D. (2016). Student loans or marriage? A look at the highly educated. Economics of Education Review, 53, 207–216. https://doi.org/10.1016/j.econedurev.2016.04.006.

    Article  Google Scholar 

  • Grinstein-Weiss, M., Perantie, D., Taylor, S., Guo, S., & Raghavan, R. (2016). Racial disparities in education debt burden among low- and moderate-income households. Children & Youth Services Review, 65, 166–174. https://doi.org/10.1016/j.childyouth.2016.04.010.

    Article  Google Scholar 

  • Hagquist, C. E. (1998). Economic stress and perceived health among adolescents in Sweden. Journal of Adolescent Health, 22(3), 250–257.

    Article  Google Scholar 

  • Hajat, A., Kaufman, J. S., Rose, K. M., Siddiqi, A., & Thomas, J. C. (2010). Do the wealthy have a health advantage? Cardiovascular disease risk factors and wealth. Social Science & Medicine, 71(11), 1935–1942.

    Article  Google Scholar 

  • Hiltonsmith, R. (2013). At what cost? How student debt reduces lifetime wealth (report). New York: Demos. Retrieved from http://www.demos.org/sites/default/files/publications/AtWhatCostFinal_Demos.pdf.

  • Hoeve, M., Stams, G. M., van der Zouwen, M., Vergeer, M., Jurrius, K., & Asscher, J. J. (2014). A systematic review of financial debt in adolescents and young adults: Prevalence, correlates and associations with crime. PLoS ONE, 9(8), 1–16. https://doi.org/10.1371/journal.pone.0104909.

    Article  Google Scholar 

  • Hoeymans, N., Feskens, E. J., Van den Bos, G. A., & Kromhout, D. (1997). Age, time, and cohort effects on functional status and self-rated health in elderly men. American Journal of Public Health, 87(10), 1620–1625.

    Article  Google Scholar 

  • Hojman, D. A., Miranda, Á, & Ruiz-Tagle, J. (2016). Debt trajectories and mental health. Social Science & Medicine, 16, 754–762. https://doi.org/10.1016/j.socscimed.2016.08.027.

    Article  Google Scholar 

  • Houle, J. N., & Berger, L. (2015). Is student loan debt discouraging homeownership among young adults? Social Service Review, 89(4), 589–621.

    Article  Google Scholar 

  • Jackson, B. A., & Reynolds, J. R. (2013). The price of opportunity: Race, student loan debt, and college achievement. Sociological Inquiry, 83(3), 335–368. https://doi.org/10.1111/soin.12012.

    Article  Google Scholar 

  • Jessop, D. C., Herberts, C., & Solomon, L. (2005). The impact of financial circumstances on student health. British Journal of Health Psychology, 10, 421–439.

    Article  Google Scholar 

  • Kahn, J. R., & Pearlin, L. I. (2006). Financial strain over the life course and health among older adults. Journal of Health and Social Behavior, 47(1), 17–31. https://doi.org/10.1177/002214650604700102.

    Article  Google Scholar 

  • Kaplan, R. M., Fang, Z., & Kirby, J. (2017). Educational attainment and health outcomes: Data from the Medical Expenditures Panel Survey. Health Psychology, 36(6), 598.

    Article  Google Scholar 

  • Kim, J., Sorhaindo, B., & Garman, E. T. (2006). Relationship between financial stress and workplace absenteeism of credit counseling clients. Journal of Family and Economic Issues, 27(3), 458–478.

    Article  Google Scholar 

  • Kissel, M. (2004, June 30). Rising health-care costs hit home. The Wall Street Journal, p. D2.

  • Krause, N., & Hayward, R. D. (2015). Assessing whether trust in God offsets the effects of financial strain on health and well-being. International Journal for the Psychology of Religion, 25(4), 307–322. https://doi.org/10.1080/10508619.2014.952588.

    Article  Google Scholar 

  • Lange, C., & Byrd, M. (1998). The relationship between perceptions of financial distress and feelings of psychological well-being in New Zealand university students. International Journal of Adolescence and Youth, 7(3), 193–209. https://doi.org/10.1080/02673843.1998.9747824.

    Article  Google Scholar 

  • Lazarus, R. S., & Folkman, S. (1984). Coping and adaptation. In W. D. Gentry (Ed.), The handbook of behavioral medicine (pp. 282–325). New York: Guilford.

    Google Scholar 

  • Lee, J., Kim, E., & Wachholtz, A. (2016). The effect of perceived stress on life satisfaction: The mediating effect of self-efficacy. Chongsonyonhak Yongu, 23(10), 29–47.

    Google Scholar 

  • Leganger, A., & Kraft, P. (2003). Control constructs: Do they mediate the relation between educational attainment and health behaviour? Journal of Health Psychology, 8(3), 361–372.

    Article  Google Scholar 

  • Looney, A., & Yannelis, C. (2015). A crisis in student loans? How changes in the characteristics of borrowers and in the institutions they attended contributed to rising loan defaults. Brookings Paper on Economic Activity. Retrieved from https://www.brookings.edu/wp-content/uploads/2016/07/ConferenceDraft_LooneyYannelis_StudentLoanDefaults.pdf.

  • Lyons, A. C., & Yilmazer, T. (2005). Health and financial strain: Evidence from the survey of consumer finances. Southern Economic Journal, 71(4), 873–890.

    Article  Google Scholar 

  • May, J. H., & Cunningham, P. J. (2004). Tough trade-offs: Medical bills, family finances and access to care. Center for Health System Change Issue Brief, 85, 1–4.

    Google Scholar 

  • McKinney, L., & Burridge, A. B. (2015). Helping or hindering? The effects of loans on community college student persistence. Research in Higher Education, 56(4), 299–324. https://doi.org/10.1007/s11162-014-9349-4.

    Article  Google Scholar 

  • Meeks, S., & Murrell, S. A. (2001). Contribution of education to health and life satisfaction in older adults mediated by negative affect. Journal of Aging and Health, 13(1), 92–119.

    Article  Google Scholar 

  • Mezza, A., Ringo, D., Sherlund, S., & Sommer, K. (2016). On the effect of student loans on access to homeownership. Working Papers—US. Federal Reserve Board’s Finance & Economic Discussion Series, 1–35. https://doi.org/10.17016/FEDS.2016.010.

  • Miech, R. A., & Shanahan, M. J. (2000). Socioeconomic status and depression over the life course. Journal of Health and Social Behavior, 41(2), 162–176.

    Article  Google Scholar 

  • Minicozzi, A. (2005). The short term effect of educational debt on job decisions. Economics of Education Review, 24(4), 417–430.

    Article  Google Scholar 

  • Mirowsky, J., & Ross, C. E. (1986). Social patterns of distress. Annual Review of Sociology, 12(1), 23–45.

    Article  Google Scholar 

  • Nelson, M. C., Lust, K., Story, M., & Ehlinger, E. (2008). Credit card debt, stress and key health risk behaviors among college students. American Journal of Health Promotion, 22(6), 400–407.

    Article  Google Scholar 

  • Pearlin, L. I., Schieman, S., Fazio, E. M., & Meersman, S. C. (2005). Stress, health, and the life course: Some conceptual perspectives. Journal of Health and Social Behavior, 46(2), 205–219.

    Article  Google Scholar 

  • Price, D. V. (2004). Educational debt burden among student borrowers: An analysis of the baccalaureate & beyond panel, 1997 Follow-Up. Research in Higher Education, 45(7), 701–737.

    Article  Google Scholar 

  • PwC. (2017). 2017 Employee Financial Wellness Survey. Retrieved from https://www.pwc.com/us/en/private-company-services/publications/assets/pwc-2017-employee-wellness-survey.pdf.

  • Richardson, T., Elliott, P., & Roberts, R. (2013). The relationship between personal unsecured debt and mental and physical health: A systematic review and meta-analysis. Clinical Psychology Review, 33(8), 1148–1162. https://doi.org/10.1016/j.cpr.2013.08.009.

    Article  Google Scholar 

  • Roberts, R. P., Golding, J. P., Towell, T. P., & Weinreb, I. M. (1999). The effects of economic circumstances on British students’ mental and physical health. Journal of American College Health, 48(3), 103–109. https://doi.org/10.1080/07448489909595681.

    Article  Google Scholar 

  • Rose, C. C. (2016). Overcoming the obstacles student debt presents to the ability to buy a home. Journal of Financial Service Professionals, 70(5), 72–80.

    Google Scholar 

  • Rothstein, J., & Rouse, C. E. (2011). Constrained after college: Student loans and early-career occupational choices. Journal of Public Economics, 95(1–2), 149–163.

    Article  Google Scholar 

  • Ryff, C. D. (1995). Psychological well-being in adult life. Current Directions in Psychological Science, 4(4), 99–104.

    Article  Google Scholar 

  • Schneiderman, N., Ironson, G., & Siegel, S. D. (2005). Stress and health: Psychological, behavioral, and biological determinants. Annual Review of Clinical Psychology, 1, 607–628. https://doi.org/10.1146/annurev.clinpsy.1.102803.144141.

    Article  Google Scholar 

  • Selye, H. (1976). Stress in health and disease. Reading: Butterworth’s.

    Google Scholar 

  • Siahpush, M., & Carlin, J. B. (2006). Financial stress, smoking cessation and relapse: Results from a prospective study of an Australian national sample. Addiction, 110, 121–127.

    Article  Google Scholar 

  • Siahpush, M., Huang, T. T., Sikora, A., Tibbits, M., Shaikh, R. A., & Singh, G. K. (2014). Prolonged financial stress predicts subsequent obesity: Results from a prospective study of an Australian national sample. Obesity, 22(2), 616–621. https://doi.org/10.1002/oby.20572.

    Article  Google Scholar 

  • Smith, J. P. (1999). Healthy bodies and thick wallets: The dual relation between health and economic status. The Journal of Economic Perspectives, 13(2), 145–166.

    Article  Google Scholar 

  • Spreitzer, E., & Snyder, E. E. (1974). Correlates of life satisfaction among the aged. Journal of Gerontology, 29(4), 454–458.

    Article  Google Scholar 

  • Stack, S., & Eshleman, J. R. (1998). Marital status and happiness: A 17-nation study. Journal of Marriage and the Family, 60(2), 527–536.

    Article  Google Scholar 

  • Stevenson, J. S. (2010). The relationship between student credit card debt, volunteerism, academic achievement, and health. Dissertation Abstracts International, 71, 3368.

    Google Scholar 

  • Sweet, E., Nandi, A., Adam, E. K., & McDade, T. W. (2013). The high price of debt: Household financial debt and its impact on mental and physical health. Social Science & Medicine, 91, 94–100. https://doi.org/10.1016/j.socscimed.2013.05.009.

    Article  Google Scholar 

  • The Institute for College Access and Success (2016). Average student debt at graduation up 4% to $30,100 for class of 2015. Retrieved from https://ticas.org/sites/default/files/pub_files/student_debt_and_the_class_of_2015_nr.pdf.

  • United States Department of Education (2017). U.S. Department of Education Releases National Student Loan FY 2014 Cohort Default Rate. Retrieved from https://www.ed.gov/news/press-releases/us-department-education-releases-national-student-loan-fy-2014-cohort-default-rate.

  • Verbrugge, L. M. (1979). Marital status and health. Journal of Marriage and the Family, 41(2), 267–285.

    Article  Google Scholar 

  • Walsemann, K. M., Gee, G. C., & Gentile, D. (2015). Sick of our loans: Student borrowing and the mental health of young adults in the United States. Social Science & Medicine, 124, 85–93. https://doi.org/10.1016/j.socscimed.2014.11.027.

    Article  Google Scholar 

  • Whitaker, S. (2015). Are millennials with student loans upwardly mobile? Economic Commentary, 12, 1.

    Google Scholar 

  • Wilson-Strydom, M., & Walker, M. (2015). A capabilities-friendly conceptualisation of flourishing in and through education. Journal of Moral Education, 44(3), 310–324.

    Article  Google Scholar 

  • Wooldridge, J. M. (2010). Econometric analysis of cross section and panel data. Cambridge: MIT.

    Google Scholar 

  • Xiao, J. J., Tang, C., & Shim, S. (2009). Acting for happiness: Financial behavior and life satisfaction of college students. Social Indicators Research, 92(1), 53–68. https://doi.org/10.1007/s11205-008-9288-6.

    Article  Google Scholar 

  • Zhan, M., Xiang, X., & Elliott, W. I. (2016). Education loans and wealth building among young adults. Children and Youth Services Review, 66, 67–75. https://doi.org/10.1016/j.childyouth.2016.04.024.

    Article  Google Scholar 

  • Zhang, L. (2013). Effects of college educational debt on graduate school attendance and early career and lifestyle choices. Education Economics, 21(2), 154–175.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Family Science, University of Maryland, 1142P, School of Public Health, College Park, MD, 20742, USA

    Jinhee Kim

  2. Department of Financial Planning, Housing and Consumer Economics, University of Georgia, 205, Dawson Hall, Athens, GA, 30622, USA

    Swarn Chatterjee

Authors
  1. Jinhee Kim
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Swarn Chatterjee
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Swarn Chatterjee.

Ethics declarations

Conflict of interest

Jinhee Kim and Swarn Chatterjee declare that they have no conflict of interest.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Kim, J., Chatterjee, S. Student Loans, Health, and Life Satisfaction of US Households: Evidence from a Panel Study. J Fam Econ Iss 40, 36–50 (2019). https://doi.org/10.1007/s10834-018-9594-3

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10834-018-9594-3

Keywords

Search

Navigation