Top 10 Cities Where Student Loan Debt Is Higher Than Annual Income for Grads

It’s September, which means it’s back to school for many college students who may take on new loans for the upcoming school year. Student loan debt in the U.S. has passed the $1.2 trillion mark and tuition prices continue to rise.

Using Credit Sesame’s data, we looked at which cities have the most student loan debt across the country. We narrowed down a list of 10 cities where residents owe more in student loan debt compared to their annual incomes. We looked at the median annual income for a bachelor’s or post-graduate degree. Basically, these residents are paying back more in loans than they make in a year!

What’s happening in these cities?

So why is there such a disparity between student loan debt and income in these cities? Cost could be one explanation. If students are attending more expensive colleges or paying higher tuition because they’re considered out-of-state residents, that could lead to them borrowing more money.

The local economy is another factor. We found that in cities like San Francisco and San Jose, where there’s a very strong tech presence, students had high student loan debt but it still didn’t come close to surpassing the median annual income for someone with a college degree. On the flip side, if a city lacks a major industry sector such as tech or finance, that may translate to lower earnings. Here’s how they compare.

10. Birmingham, AL

Average student loan balance per person: $60,184
Median earnings (Bachelor’s degree): $39,868
Debt-to-income ratio (Bachelor’s degree): 151%

Birmingham takes 10^th place in our rankings, with residents owing just over $60,000 in student loans on average. The University of Alabama at Birmingham is the largest college in the area, with the average cost of tuition for in-state residents totaling $25,532. You’d have to add another $12,000 for out-of-state residents. The trucking industry is big business here, as is manufacturing, which could explain why salaries are lower.

9. Columbia, SC

Average student loan balance per person: $57,339
Median earnings (Bachelor’s degree): $40,128
Debt-to-income ratio (Bachelor’s degree): 143%

Columbia is the Palmetto State’s capital city and state government is one of the largest employers, along with Palmetto Health and BlueCross and BlueShield of South Carolina. The main campus of the University of South Carolina is located here and grads pay a pretty penny for a degree. The average cost of attendance for out-of-state residents is over $45,000 a year.

8. Cleveland, OH

Average student loan balance per person: $56,922
Median earnings (Bachelor’s degree): $42,069
Debt-to-income ratio (Bachelor’s degree): 135%

In Cleveland, the median earnings for someone with a Bachelor’s degree climbs a bit higher and the gap narrows even further for residents with a post-graduate degree. As far as where grads are seeking jobs most often, the Cleveland Clinic and University Hospitals take the lead as the city’s largest employers.

7. Hollywood, FL

Average student loan balance per person: $55,646
Median earnings (Bachelor’s degree): $41,531
Debt-to-income ratio (Bachelor’s degree): 134%

Hollywood’s inclusion on our list is interesting, considering that there are several technical schools in the area but no major college or university. It could be that student loan balances exceed earnings because grads are moving here from other cities to soak up the sun. The University of Miami and Florida International University, for example, are just a short distance away in Miami.

6. Buffalo, NY

Average student loan balance per person: $50,534
Median earnings (Bachelor’s degree): $38,502
Debt-to-income ratio (Bachelor’s degree): 131%

For post-grads in Buffalo, there’s only a very slight difference between their student loan debt and how much they earn. Residents who just have a Bachelor’s degree, on the other hand, still owe quite a bit more than what they make. Buffalo’s economy is a diverse mix of industries, including research and development, manufacturing and education, so income really depends on where you decide to pursue a career path.

5. Atlanta, GA

Average student loan balance per person: $66,403
Median earnings (Bachelor’s degree): $51,548
Debt-to-income ratio (Bachelor’s degree): 129%

Atlanta has become something of a boom town for Millennials in recent years but despite an uptick in the number of jobs, residents still aren’t able to make their paychecks align with their student loan debt. That could be because the cost of attendance at one of the city’s best-known schools, Emory University, is a staggering $63,000 annually.

4. St. Louis, MO

Average student loan balance per person: $53,120
Median earnings (Bachelor’s degree): $41,391
Debt-to-income ratio (Bachelor’s degree): 128%

The city of St. Louis plays host to a number of colleges and universities, including the University of Missouri and several private schools. When you look at who’s employing the most people, it’s a mixed bag. BJC HealthCare tops the list but Wal-Mart is the second-largest employer, followed by Boeing at number three. Those all represent very different options where salary is concerned.

3. Dayton, OH

Average student loan balance per person: $43,144
Median earnings (Bachelor’s degree): $33,762
Debt-to-income ratio (Bachelor’s degree): 128%

If you’re going to live in Dayton and you have student loan debt, you’re better off having a post-graduate degree. The median earnings for someone with a post-grad degree totals $55,157, so you’ve got a better shot at getting your loans paid down faster. If you’re on the hunt for a job, the healthcare sector generates plenty of opportunities.

2. Nashville, TN

Average student loan balance per person: $52,253
Median earnings (Bachelor’s degree): $42,016
Debt-to-income ratio (Bachelor’s degree): 124%

Blues music and barbecue are two of Nashville’s biggest selling points and it’s become the kind of place that Millennials are increasingly drawn to. Vanderbilt University is the most recognizable school in the area and the annual cost of attendance comes to a cool $63,532.

1. Richmond, VA

Average student loan balance per person: $52,810
Median earnings (Bachelor’s degree): $42,499
Debt-to-income ratio (Bachelor’s degree): 124%

Financial services and healthcare are at the forefront of Richmond’s economy but that doesn’t necessarily mean residents are bringing home oversized paychecks. It likely doesn’t help that the cost of attendance at the University of Richmond is more than $61,000 annually. Virginia Commonwealth University isn’t much cheaper, at nearly $45,000 a year.

Methodology

To formulate our study, we drew on our database of more than eight million members. We focused on cities that had a minimum of 350 Credit Sesame members with at least one open student loan account. We analyzed the average student loan balance per person, then compared that to the median household income for someone with a bachelor’s degree and a post-graduate degree in that city.

From there, we calculated the percentage of student debt each resident had compared to their income. For example, in Birmingham, the number 10 city on our list, residents have 1.5 times more student loan debt than the typical bachelor’s degree holder earns in a year. We ranked our cities based on this ratio, from highest to lowest.

Household income data was drawn from the U.S. Census Bureau. Information about total student loan comes from the Federal Reserve. Average cost of attendance data for selected schools mentioned in the listings are drawn from CollegeData.com.