Women take longer than men to pay off their student loans — here's why

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Student loans haunt millions of workers, but new research has found that they can be even more of a strain for women, due in part to the gender-based pay gap.

A report from the American Association of University Women shows that it takes women longer to pay off their student loans. The disparity is even greater for African American and Hispanic women.

The AAUW looked at people who were working at least 35 hours a week and who had not attended graduate school following college.

Female graduates from the 2007-8 school year, who make up the largest percentage of enrolled bachelors degree students in 4-year colleges, paid off around 33 percent of their student debt between 2009 and 2012. But men made better progress than women, paying off 44 percent of their loans in the same period of time.

Black and Hispanic women from the same graduating year fared worse. Black women had shrunk their debts by only 9 percent in 2012, and Hispanic women had reduced theirs by a tiny 3 percent.

Even worse, 53 percent of women are paying more than what the typical person can reasonably afford towards their loans, compared to 39 percent of men. As a result, these women are less able to put aside savings for retirement, purchase a car or become a homeowner, according to the study.

“The gap in debt repayment may also make it more difficult for women to take risks that could pay off in the long run, like changing job sectors or starting a business, further contributing to the pay gap as women move through the workforce,” the report reads.  

Part of the reason for the discrepancy in paying off student loans is because fewer women choose professional areas of study or majors in STEM courses that pay high salaries in the job market. An earlier study by the AAUW found that women were paid 82 percent of what similarly educated males earned one year after college graduation. After 10 years, women earned only 69 percent of what males were paid.  

The wage disparity becomes even greater once race is taken into account. Black and Hispanic women make about 64 percent and 56 percent, respectively, of white men’s earnings one year after graduation.

But the report notes that the pay gap isn’t entirely due to gender inequality. Other factors that play a role are choice of college major and the type of profession pursed after graduation. 

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