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Kip Tips

How Much Student Debt is Too Much?

Tips on how to avoid overborrowing.

As you’re crunching the numbers, consider how much debt your student will be able to afford after college. Most students borrow to finance their education—to the tune of an average $29,400 per borrower for the class of 2012. But how manageable that debt is depends on the student’s career path.

See Our Story: The Right Way to Borrow for College

To avoid overborrowing, students should aim to keep total debt to no more than their anticipated starting salary after graduation, says Mark Kantrowitz, senior vice-president and publisher of You can go to to see salaries in specific fields; use the figures as a guide for borrowing. For example, a civil engineering student can expect an annual starting salary of about $54,000, according to Graduates in that field should be able to manage more debt than, say, an elementary education major, who can anticipate earning about $32,000 during the first year of teaching. (If your child doesn’t have a career path in mind, Carol Stack and Ruth Vedvik, authors of The Financial Aid Handbook (Career Press), recommend limiting borrowing to $32,000 total, the majority of which can come from federal loans.)

By limiting borrowing to your anticipated first-year salary, your graduate should be able to retire the debt in 10 years or less, avoiding the need for alternative plans that stretch the term of the loan and increase the total interest (see the accompanying story). For an idea of what monthly payments will be, use the loan calculators at