Massive student loan debt is having a crippling effect on the U.S. economy. According to the United States Federal Reserve, 44.2 million students owe $1.52 trillion . This amount is growing by $29 billion a quarter.
Student loan debt now surpasses all other forms of debt except mortgages. College debt exceeds what is owed for vehicle loans and on credit cards.
There is no consensus on how this debt burden impacts small businesses; however, it must affect buying decisions. It also lowers credit scores and reduces the ability to qualify for credit cards and loans for other purposes.
Student loan debt may reduce small business formation, but some argue Millennials are less interested in starting businesses than previous generations.
Saddled with debt, fewer can qualify to buy a house or a car. Lower home ownership reduces retail spending on furnishings and improvements.