Those Who Pay and Those Who Don't: Family Aid, Student Loan Debt, and Consequences for the Transition to Adulthood

Open Access
Pearson, Katherine E
Graduate Program:
Doctor of Philosophy
Document Type:
Date of Defense:
January 27, 2015
Committee Members:
  • Melissa Hardy, Dissertation Advisor
  • Molly Martin, Committee Member
  • Marylee Carmel Taylor, Committee Member
  • Diane Krantz Mclaughlin, Committee Member
  • Student loan debt
  • family aid
  • transition to adulthood
  • NLSY
  • young adults
In recent decades, student loan debt has become a harsh reality for the majority of American students. Surprisingly, there is a substantial lack of research into both the factors that shape student loan debt accumulation and the consequences of that debt throughout the life course. This dissertation provides insight into these questions by presenting three related chapters on student loan debt, using data from the National Longitudinal Survey of Youth 1997 (NLSY-97). Results from the first study indicate that financial contributions from family for educational expenses have the power to shape student loan usage. The effect of family aid is complex, and the direction and strength of the effect vary depending on several factors. In general, family gifts can serve to reduce the likelihood that students will take out student loans, provided that the family gifts received are large enough. The second study explores this relationship further, finding that the extent to which family gifts are able to prevent student loan usage varies depending on socioeconomic status, with wealthier students receiving greater benefits from family gifts. Family gifts do not explain much of the effect of parental socioeconomic status on the likelihood of taking out student loans, however, indicating that parental resources work in both direct and indirect ways to shape student loan debt. The third study turns to an examination of the consequences of student loan debt for young adults, finding that high levels of student loan debt increase the likelihood that young adults will live with roommates at age 25 rather than living independently; increase the likelihood that young adults will return to live with parents after initially moving out; and decrease the likelihood of early homeownership. Overall, these results underscore the potential for student loan debt to negatively affect students as they transition to adulthood and emphasize the importance of socioeconomic status and direct family aid as determinants of those who carry the cost of their college education beyond graduation and into adulthood, and those who do not.