What Factors Are Important in Aversion to Education Debt?

This study examined the factors related to attitude toward education debt. Based on the conceptual framework of the multidimensional nature of attitude toward debt, empirical models were constructed with variables focused on debt utility and debt fear. Using the 2016 Survey of Consumer Finances dataset, this study found that debt utility variables, such as having a higher educational level and holding a student loan balance, were negatively associated with an aversion to education debt. However, debt fear variables, such as unfavorable attitudes about debt in general and not having applied for credit, were positively associated with aversion to education debt. Subgroup analyses across different income and educational levels showed that the negative relationship between education level and aversion to education debt was more evident in the high-income group and that most of the debt utility and debt fear variables were statistically significant only in the lower education level. These results suggest that aspects of debt utility and fear of debt contribute to attitudes about education debt, but there is inconsistency across socioeconomic status.