As 1 in 3 households with student loans prepare for $1,000+ payments per month, many Americans plan to increase credit card debt

As 1 in 3 households with student loans prepare for $1,000+ payments per month, many Americans plan to increase credit card debt

Almost 20% of adults with student loans wish they invested the money to grow it in the market instead of taking on student debt

(Greenwood Village, COLO – July 27, 2023) Nearly a third (31%) of Americans with student debt say they opted not to make payments on their loans during the national forbearance, using the reprieve to pay down credit card debt, save up for discretionary spending and build up their emergency savings, according to new research by Empower, a leader in planning, investing and advice.

To afford their student loan payments, 32% of Americans say they plan to take on more credit card debt. They also plan to cut back on discretionary spending (59%), dining out (59%), and almost a third (31%) of those surveyed are considering trading in their car and will say bon voyage to upcoming trips and vacations (41%). To increase savings, 52% of Americans are considering switching to a higher paying job and 48% are planning on taking on a side hustle.

Almost 1 in 4 adults with student loans (18%) wish they invested the money to grow it in the market instead of taking on debt and had done more research before signing the note (23%). Higher education remains paramount to respondents with just 14% saying they wouldn’t go to college if they could do it all over again.

Additional key findings:

  • Roommate wanted: Gen Zers (49%) and Millennials (38%) are considering moving in with roommates to afford their monthly payments, and 39% of Gen Zers with student debt say they may move back in with their parents.
  • Moving, and still renting: Moving to a lower cost area is on the minds of Americans with student loan debt, with 46% of Millennials and 47% of Gen Z saying they may relocate to a more affordable area, compared to 39% of the student loan population as a whole. But they won’t become homeowners in the process – some half of Americans with student debt (46%) may delay buying a home once payments resume, including 52% of Millennials, 45% of Gen Z and 39% of Gen X.
  • Relying on credit cards: Over half of Gen Z and Millennials who have student debt (51% each) say they were able to pay down $100 of credit card debt each month during the pause, close to one third (31% of Gen Z and 38% of Millennials) say they will likely take on more credit card debt once the forbearance ends.

Options are available that may make repaying student loans less of a burden, according to Vance Rusley, CFP®.

“In the few months left before the payment pause, you may want to store money in a high yield cash account. These accounts earn a higher interest rate than traditional savings accounts – for example, Empower Personal CashTMcurrently offers a 4.45% APY1 – plus these types of accounts are super liquid, so you can access your money at any time. That money can earn interest until student loan payments are due, and then it can either serve as the start of an emergency fund or a lump sum payment toward your student debt.”

The full report can be found on The Currency™. Visit to schedule an appointment with a skilled financial professional or sign up for its free financial tools.


Empower engaged Morning Consult to conduct a survey of 2,210 adults. The poll was conducted online June 28-30,2023 and the data was weighted to approximate a target sample of adults based on gender, age, race, educational attainment, and region. Results from the full survey have a margin of error of plus or minus 2 percentage points.


Empower, a leader in financial planning, investing, and advice, is dedicated to creating financial freedom through people and technology. It administers approximately $1.3 trillion in assets for more than 17 million retirement plan participants and is the nation’s second-largest retirement plan recordkeeper by total participants.2 Connect with us on

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1 The Empower Personal Cash™ Annual Percentage Yield (APY) as of 5/10/23 is 4.45% APY (4.362% interest rate). The calculation for APY is rounded to the nearest basis point. Both the interest rate and APY are variable and subject to change at UMB’s discretion at any time without notice.

Empower Personal Cash™ Program is offered through Empower Personal Wealth, LLC (“Empower”). Empower is not a bank. Bank deposit products provided by UMB Bank n.a., Member FDIC (“UMB”). To participate in the program, you must open an account at UMB, through which your funds will be placed in accounts at participating program banks (which may include UMB). The advertised interest rates are paid by participating program banks, including by UMB in its capacity as a participating program bank. Your funds will be FDIC insured up to applicable limits while in transit through UMB. UMB receives a fee from each program bank (except UMB) in connection with the program that is based on the aggregate daily closing balance of deposits held in program accounts by such program bank. The fee may vary from program bank to program bank and will generally increase as the aggregate amount of funds held in program accounts with the program bank increases.

2 As of January 31, 2023. Assets under Administration (AUA) refers to the assets administered by Empower pursuant to service contracts, including recordkeeping, for retirement plans and participants, IRAs and other pension accounts. On August 1, 2022, Empower announced that it is changing the names of various companies within its corporate group to align the names with the Empower brand. For more information regarding the name changes, please visit

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