Skip to main content

You are here


Some Surprising Findings About the Nation’s Student Loan Burden

Industry Trends and Research

How much are individuals paying toward their student loan debt instead of their 401(k)? New research from Fidelity Investments breaks down the numbers – which may not be what you expect. 

According to the data, which is derived from nearly 30,000 users of the firm’s Student Debt Tool representing more than 4,400 companies, many individuals are delaying contributing to their retirement or they are taking out loans against their 401(k) – an action the firm characterizes as “literally borrowing against one’s future to pay for the past.” Nearly one in five (19%) Student Debt Tool users report contributing nothing to their 401(k), with one in four (24%) only contributing between 1% and 5% of their salary. 

Overall, 14% report having an outstanding loan against their 401(k), which Fidelity notes is a concern because these loans can have a negative impact on 401(k) balances, particularly with younger retirement savers, who have a longer time horizon and greater potential in their early years to save more.   

Based on Federal Reserve data, Fidelity observes, there is an estimated $1.56 trillion in student debt in the United States, and December signifies the first time 2019 college graduates will begin paying back student loans, six months after graduation. 

Which industries are burdened most with student debt? According to Fidelity’s data, employees in the private health care and social assistance industries are by far paying the most at $685 a month, with an average loan balance of $75,336. This is more than $120 a month higher than the nearest sector, which is higher education. The data below, derived from Fidelity’s Student Debt Tool, shows the industries with the highest average student loan debt burden. 


Average Monthly Payment

Average Loan Balance

Private health care and social assistance



Higher education



Professional scientific and technical services



Non-profit health care



Information services






Business management



Real estate



Surprisingly, the data also reveals that student loan debt is not a problem isolated only to the young. Even though the majority of Student Debt Tool users who reported their debt are Millennials, Baby Boomers and Gen Xers actually carry a higher average student debt loan burden.


Number of Users

Average Monthly Payment

Average Loan Balance

Baby Boomers 




Gen Xers








“The data is clear – finding ways to effectively pay down student debt isn’t an isolated problem. It is impacting young and old, as well as workers in various industries,” notes Asha Srikantiah, head of Fidelity Investments’ student debt program.

As such, Fidelity and others are increasingly looking at ways to assist employers with helping their employees. For example, Fidelity’s Student Debt Benefits program enables employer-sponsored student debt benefits in a variety of benefit designs, including making student debt payments directly to a loan service provider or allowing matching 401(k) contributions triggered off employee student loan payments. 

“What we have learned this past year is growing numbers of companies are increasingly aware that helping employees address the issue of student debt can help improve their overall financial wellness, which can in turn have a positive impact from a business perspective in a host of ways,” says Srikantiah.

The Treasury Department and IRS recently updated their Priority Guidance Plan to include guidance on student loan payments under qualified plans. While the plan does not specify what the agencies are considering, the guidance presumably may expand on an IRS private letter ruling (PLR) issued last year permitting a 401(k) plan to be amended to include a student loan benefit program.