The Utah System of Higher Education worked with the 2017 Utah Legislature to adopt a new statewide program aimed at increasing awareness of student debt. Even though Utah students comparatively accrue the least amount of debt in the country, more awareness of student debt is needed. Some background on student debt in Utah:
- Utah has the lowest percentage of students who go into debt in the nation (41%); among the Utah public institutions, it is only 29%.
- Utah students also graduate with the lowest debt in the nation ($18,873 average); among the Utah public institutions it is only $12,719.
- This is largely due to Utah being the 4th lowest tuition in the nation for 4-year public institutions.
This newly-adopted legislation requires colleges and universities in Utah to notify students who have a loan to look up their federal loan payoff amount and calculate their estimated monthly payments at least annually. While USHE institutions could do this without legislation, the legislation places this requirement on ALL colleges and universities in Utah – public and private. This simple notification is a first-year pilot to test the notification process with the intention to expand it to include more real-time loan information in the future.
Similar initiatives in other states have had positive results in other states. In 2013, Indiana University began sending annual debt letters to all student borrowers, undergraduate borrowing dropped 18% over 2 years. Indiana adopted the law statewide in 2015. In early 2015, Montana State University completed a similar pilot notifying high-dollar borrowers. By mid-2016, rates of new borrowing dropped by one-third among its students. Similar legislation was adopted last year in Nebraska and is currently being considered in Illinois and Missouri.
In addition to an annual notification to students, the legislation places a higher education representative on the statewide task force that develops the curriculum of the mandatory financial literacy course provided in all Utah high schools to ensure increased awareness of ways to pay for college among high school students as they prepare for college.