Borrowers say student loan debt can cause unforeseen setbacks

When Mary and Joe Drumm became teachers, they hardly expected to become millionaires. But as the pair criss-crossed the upper Midwest — from Wisconsin to Williston and now teaching high school in downtown Grand Forks — they didn’t imagine this, either.

Mary Drumm, 31, is happy in the classroom, and so is her husband just down the hall. But she describes a difficult financial life at home, where the couple strain to make ends meet. The rent and the bills devour their paychecks every month, which Mary said has left them with little or no emergency savings. Twice a week, she said, she donates her plasma to help pay for gas and groceries.

Their student loans, Drumm said, are particularly exacting, coming to about $1,200 every month on a little less than $60,000 in debt.

And the last few years have revealed exactly how burdensome those loans can be. The pause on federal student loan payments suspended the Drumms’ responsibility for a portion of those costs — giving them the breathing room to save a few thousand dollars of emergency money. But a bout of viral labyrinthitis (it’s an ear issue) drained that fund substantially, in a demoralizing blow that’s highlighted how difficult student loans have made their lives.

“If we don’t get even a portion of them forgiven, we’re going to either continue to scrape by month to month, and eventually get bumped out of the profession entirely, when inflation pushes us out,” Drumm said, “or we’re going to have to go and just switch professions completely.”

That’s nigh-unthinkable for Mary Drumm, though she’s been forced to ponder it nonetheless.

“I love teaching English. I love teaching high school. I love how I'm able to design engaging lessons and connect with kids and give them that safe welcoming place for learning,” she said. “And it's just such a big piece of who I am that I feel just sick to my stomach thinking about having to leave that.”

The Drumms’ struggle with kitchen-table economics is playing out all over the country, as indebted college alums carefully watch the future of a student loan forgiveness plan now awaiting a ruling from the U.S. Supreme Court. The ongoing pause on federal student loan payments likely ends soon after the federal COVID emergency declaration ends ; for some borrowers, the stakes of the ruling are extraordinarily high.

It’s difficult to find an authoritative number for student debt in the upper Midwest, but all sources agree it’s significant. The Education Data Initiative puts the average federal student loan debt in North Dakota, South Dakota and Minnesota at $28,600, $30,954 and $33,600 per borrower, respectively. Notably, North Dakota’s figure is listed as the only state below $30,000.

But private loans add to the pile; roughly one-quarter of North Dakota’s graduating class of 2020 had “private debt,” the Institute for College Access and Success wrote in a recent report.

Those numbers make for a headache far beyond the kitchen table. Policymakers and observers point out that high student debt burdens can make life that much more difficult for entire low-earning — yet crucial — professions.

“In the 90s, I think a lot of our students would be hesitant about taking that on, and now it’s just become big business,” said Bret Weber, chair of UND’s social work department and a Grand Forks City Council member. “It’s become such a standard way that students too readily jump onto that debt treadmill without examining it. They just accept it as a course of life, and then get caught up by it.”

He pointed out, too, that social work students are often set up against a heavier debt load — not strictly as a matter of price, but because social work students often come from disadvantaged backgrounds.

“I suspect that as a percentage of family wealth, as a percentage of family income, (social work) student debt is higher than some of those other professions,” he said.

Nick Archuleta is the president of North Dakota United, the public-sector union that represents many of North Dakota’s teachers. He points out that recent graduates who have to pay down five-figure debt — especially young teachers on a meager salary — take far longer to save for homes or cars or other big purchases.

“So it takes them a while to become full participants in the economy if they’re strapped with a heavy debt burden from college,” Archuleta said.

Under the surface of all those five- and six-figure debt loads, things are shifting. Matthew Ternus is the former UND student body president and now the current board vice president of the Greater Grand Forks Young Professionals. Financial burdens, he said, are making students wonder if college is right for them.

“I always tell people, I toured Arizona State University, and I looked at the University of California, Los Angeles,” Ternus said. “And the tuition cost and the loans I would have had to take out would have been huge compared to what I found here at the University of North Dakota, or even other schools in the region.”

Kelvin Hullet, the chief business development officer with the Bank of North Dakota — which serves student borrowers throughout the northern-central U.S. — said that loan originations have decreased in recent years, from roughly 16,000 five years ago to about 10,000 in 2022.

Hullet is quick to say that he’s no demographer. But he noted that the shift comes as an emphasis on two-year degrees and technical skills grows.

“It’s kind of an evolution that seems to be occurring,” he said

Matt Lukach, UND’s student finance director, said that part of his job is education as much as it is processing loans and finances. Some students, he said, don’t fully understand the gravity of what their college debt really is.

“Part of our job is to say, by signing this, you need to know that this has got to be paid back. And it’s going to be one of your main bills after you graduate college,” Lukach said. “My personal connection to it is we want to educate.”

But it’s increasingly a conversation that students are primed to hear, said Shawn Helmbolt, director of admissions at South Dakota State University — especially as they weigh the value of a four-year degree against other options.

“We have a lot of conversations with students and families about how their degree from our university prepares them for a lifetime of earnings, or a career full of earnings,” he said, “And not necessarily just that first job or first opportunity, post degree, but maybe their second, third or fourth career opportunity, you know, 10, 15, 20, 25 years down the road.”

For former students like Mary Drumm, it’s an important pivot to be able to make — even if it’s not one she would ever want to make.

Drumm was at the North Dakota Capitol in February, along with her husband Joe, as the duo visited with fellow North Dakota United members to support funding for public education — the kind that she thinks can help her pay her bills and keep her in teaching.

“I was one of those poor kids who went to school in order to get fed, and to meet my teachers and have that happy, safe environment,” she said in a video publicly posted by the union . “And I saw, back in Wisconsin, where I grew up, I saw those happy teachers. And they had salaries that could support their families.”