Why College Is No Longer Seen as "Good Debt" by Many Borrowers

Student loans have long been called "good debt." CNBC says that idea is now being questioned, as tuition goes up, federal lending rules change and the job market becomes less certain.

There is simply much more student debt than before. More than 42 million Americans carry federal education debt, and the total is above $1.7 trillion. Twenty years ago it was closer to $516 billion, owed by 28 million borrowers. A Pew Research Center study from 2025 found that nearly 8 in 10 adults say colleges do only a "fair" or "poor" job of keeping tuition affordable, and 55% gave the same grade for preparing students for well-paying jobs. A study by NerdWallet from earlier this year showed that almost 80% of people in the U.S. think the government's student loan program is not working.

The article lists factors that make college a bigger financial risk. The first is the price. In the 1971-72 school year, tuition and fees at a private four-year college averaged $14,550 after adjusting for inflation. By 2025-2026, that had grown to $45,000. Tuition has gone up about 5.5% a year on average since 1983, faster than inflation and wages, according to a 2026 report by J.P. Morgan Asset Management. With room and board, the yearly cost at a private four-year school averages $60,920, and some colleges charge more than $100,000.

Rules for repaying loans have also changed. New rules from this year took away many low-cost ways to pay back loans and ended protections for people, such as the ability to stop making federal loan payments while out of work. At the same time, artificial intelligence is changing entry-level hiring, especially in technology, and many families wonder whether a degree is worth the cost.

Carolyn Fast of The Century Foundation said students are asked to make a decision with long-term financial results without knowing what jobs will be available or what the rules for their debt will be.