Disparities in Debt: Parents’ Socioeconomic Resources and Young Adult Student Loan Debt
Abstract
In an era of rising college costs and stagnant grant-based student aid, many young adults rely on their parents’ resources and student loans to pay for their postsecondary education. In this study I ask how parents’ income and education are linked to young adults’ student loan debt. I develop and test two perspectives regarding the functional form of the association between parents’ income, parents’ education, and student loan debt. I have four key findings. First, the relationship between parents’ income and student loan debt is nonlinear, such that young adults from middle-income families have a higher risk for debt than do those from low- and high-income families. Second, young adults from college-educated and high-income families are relatively protected from debt. Third, the association between parents’ socioeconomic status (SES) and debt is modified by postsecondary institutional characteristics and is strongest at private and high-cost institutions. Finally, the effect of parents’ SES on debt varies across the debt distribution. Parents’ SES is strongly predictive of entry into debt, but there are few differences conditional on going into debt. This suggests that socioeconomic disparities in debt are primarily driven by the probability of going into debt rather than differences among debtors. However, compared to their more advantaged counterparts, young adults from low-SES backgrounds have a higher risk of accruing debt burdens that exceed the national average.
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The relationship between borrowing and income is non-linear.
“Although the relationship between borrowing and income is non-linear (Houle, 2013; Sanchez et al., 2024)”
From Wealth, Race, and Under-Addressed Financial Need in Federal Student Aid Policy (2025) · cites this paper as Houle, 2013
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Young, Black, and (Still) in the Red: Parental Wealth, Race, and Student Loan Debt
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“Although the relationship between borrowing and income is non-linear (Houle, 2013; Sanchez et al., 2024), Addo et al. (2016) show that, even when accounting for family income differences, individuals from low-wealth families have more student debt than their higher wealth peers.”
- Authors
- Houle, J. N.
- Affiliations
- Dartmouth College (US)
- Corresponding author
- Houle, Jason N.
- ORCID
- Houle, Jason N.
- Venue
- Sociology of Education
- Publisher
- SAGE Publications
- Published
- 2013-12-05
- Volume
- 87
- Issue
- 1
- Pages
- 53-69
- ISSN
- 0038-0407 (ISSN-L)
- 1939-8573
- OpenAlex
- W2127041558
- Cited by
- 215
- References
- 54
- Citations by year
- 2026: 9 · 2025: 19 · 2024: 14 · 2023: 12 · 2022: 18 · 2021: 23 · 2020: 31 · 2019: 24 · 2018: 16 · 2017: 14 · 2016: 22 · 2015: 7 · 2014: 6
- FWCI
- 55.64
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Sociology of Education (publishedVersion)
- Topics
- Social Sciences › Education › Higher Education Research Studies
- Social Sciences › Sociology and Political Science › Intergenerational and Educational Inequality Studies
- Social Sciences › Education › School Choice and Performance
- Keywords
- student debt, socioeconomic disparities, parental income, parental education, young adults, college costs, student financial aid, nonlinear income effects, private colleges, debt burden
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