A Daily Mental Toll: How Timing of Educational Loans Shapes Bachelor's Degree Completion

• In Event: Marriott Roundtable Session 1
  In Roundtable Session: Financing College Enrollment: Programs, Strategies, and Policies

Abstract

A growing literature considers the relationship between educational debt and college completion, but there has been little attention to whether the timing of when students use loans also influences Bachelor’s degree attainment. Using the National Longitudinal Survey of Youth, 1997, I find that students who delay the onset of debt until the later years of college are more likely to complete a degree suggesting that the daily mental stress of borrowing accumulates over the years of college. However, the association between timing of loans and degree attainment varies by the amount students borrow, indicating a limit to the benefits of delayed borrowing. This study points to ways college can restructure institutional aid to better support degree attainment among their students.

Author

• Kennan Cepa, University of Pennsylvania