Soaring student loans are weighing on the economy

Personal bankruptcies are rising.
Consumer stress is growing with rising prices, tariffs and slowing job growth.
Medical expenses, job losses and divorce are among the top problems that lead to a bankruptcy.
Personal bankruptcy filings are up as much as 15% in 2025. It’s likely they’ll rise even more in 2026.
Some of it is the economy, which may look great overall on paper. (Nvidia (NVDA) hit a new 52-week high on Thursday.) But many consumers are stressed from slowing job growth, tariffs, and business uncertainty.
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Plus, there’s the continuing hangover from the Covid-19 pandemic, the disaster that keeps on giving.
That said, there is one specific reason why many Americans will ask bankruptcy courts to help. They’re drowning in student loans.
This should not be a surprise. Student loan outstanding in the United States has grown fantastically in recent years, from $511 billion in 2006 to $1.81 trillion as of June, according to data from the Federal Reserve.
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