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Student loan debt increased by $31 billion in first quarter

It’s the time of year to celebrate the accomplishments of those students who have finished their studies and are graduating. Great job. Now, it’s also time to start paying back all those student loans taken out to fund a college education.
Kirby Brown, Deseret News Modified: May 16, 2014 at 5:47 pm •  Published: May 21, 2014
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It’s the time of year to celebrate the accomplishments of those students who have finished their studies and are graduating.

Now, it’s also time to start paying back all those student loans taken out to fund a college education.

In a study recently released by the Federal Reserve Bank of New York, total student debt outstanding as of the end of the first quarter of 2014 was reported to be $1.11 trillion. Student loans outstanding increased by $31 billion during the first quarter of 2014, an increase of about 2.8 percent.

As compared to the same period in 2013, student loan debt increased by $125 billion. This year over year increase in the total amount of student debt outstanding represents an addition of over 12 percent.

Assuming a generic 5 percent annual cost on the $1.11 trillion of outstanding student debt, the annual cost of servicing this debt would be $55.5 billion per year. Of course, these borrowings must be paid back too. So the overall cost of the debt, along with paying back the amount borrowed, will be even higher.

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