According to the National Center for Public Policy in Higher Education 23% of students who borrow money for college tuition drop out of college. But, for those students who do not borrow money for their college education 44% drop out, almost double. At two-year post-secondary schools, where the poorest students attend, about 25% of those who borrow fail to graduate. For those who do not borrow, 55% do not graduate.
The bottom line seems to be that students who take out loans for their education are more likely to stay in college and graduate than those who do not take out student loans.
The reasons for this discrepancy are two-fold. Students who do not borrow money for their post-secondary education will delay going to college, which may deter them for ever getting though college. Others work long hours to afford their college education, giving them less time for classes and studying. In fact, the most common reason cited for students dropping out of college is the inability to balance a job and school.
College debt is at an all-time high right now, and certainly that debt can erode future earnings of college graduates. But, if students try to go to college without college debt, they can be setting themselves up for failure. Student debt is bad, but for those who are able to graduate with a degree, they are also able to repay their loans. Failure to earn a degree at all is just as bad. The question is when does student debt assure an investment that is worth the money?