For some, student debt is like having a bad cough. It’s always there, looming, making it hard to sleep at night and even harder to live real life normally. However, a past study conducted by Rachel Dwyer of Ohio State University found that there is a sweet spot when it comes to debt. In fact, if you find yourself owing a certain amount of money, you’re actually more likely to graduate.
Hold the phone. Debt is a good thing? Just take a look at the statistics. A more recent study conducted by the Third Way think tank backs up this claim, with $10,000 in debt lining up with a 67% graduation rate. This is the highest graduation rate compared to any other amount of debt.
Which means, yes, it’s still possible to have too much debt. In both Dwyer and Third Way’s studies, graduation rates began dropping as soon as more than $10,000 in debt was accumulated. So what gives? Jim Kessler, vice president of Third Way, thinks he has it figured out:
He also notes that these statistics are particularly true when it comes to low- and middle-income students and students at public universities. It’s likely because these students are taking a greater financial risk, meaning they’re even more invested in having their work pay off. Too much debt, and for some, higher education stops being doable or worth the cost.
What this study means is that it’s okay to invest in yourself. In fact, putting some money on the line pushes you to do even better. That’s not to say you can’t still complain about your student loans, of course.