Minnesota still may have one of the highest levels of college debt in the nation, but a new state report suggests that there may be a glimmer of hope.

Two reports released Tuesday assessed how the class of 2014 fared in student debt. On Tuesday morning, the Project on Student Debt ranked Minnesota fifth-highest in the nation, with an average debt of $31,579 for graduates with bachelor's degrees. Hours later, the Minnesota Office of Higher Education issued its own report, noting a modest decrease in student debt. Instead of an average figure used in the national study, the state reported the median debt load of $27,296, the midpoint between the highest amount of debt and the lowest.

The data suggest that there is a growing movement among students to limit the amount of college loans they take out, said Larry Pogemiller, the office's commissioner.

"More and more people are looking at how much debt they are taking on," he said.

At the University of Minnesota, "we've noticed that student debt has in fact gone down," said Robert McMaster, vice provost and dean of undergraduate education. He says that's partly due to a two-year tuition freeze, which began in 2013. "The tuition freeze had a huge impact" he said.

But he also credits the U of M's intensive financial literacy program, which advises students how to keep costs down. "From the moment students step on campus, we're pounding on them: 'Don't borrow unless you have to,’ " he said. "That is, I think, making a big difference as well."

'A major policy issue'

Nationally, 7 in 10 seniors who graduated in 2014 had student loan debt, according to the survey by the nonprofit Institute for College Access & Success, with an average of $28,950 per borrower.

Over the past decade the share of graduates with debt rose modestly from 65 percent to 69 percent, the institute's report said. Their average debt was $28,950, up 2 percent compared with the class of 2013.

"Borrowers are graduating with a lot more debt than they did 10 years ago, and the class of 2014's average debt is the highest yet," said the institute's president Lauren Asher. "Student debt has rightly become a major policy issue. Students and families need better information and better policies to make college more affordable and debt less burdensome."

'So many loans already'

Hanna Shaffer, 23, graduated from the U of M with an architecture degree and $45,000 in loans in 2014. Shaffer has had to defer one of her loans to afford rent and monthly expenses. She's managed to pay off about $2,000 so far.

"I'm slowly chopping away at them and making sure I budget," she said.

Her loans are keeping her from pursuing a graduate degree.

"I have so many loans already," she said. "I feel like I can't take out more to get a better education."

Teresa Johnson, 30, graduated with $20,000 in loans from the Minnesota State University system in 2010. She is still working to pay off her debt five years later with a 1-year-old baby. Her husband helps, she said.

"It's ridiculous," she said. "School costs absolutely way too much."

Because so few for-profit colleges voluntarily report their graduates' average debt nationally, the Project on Student Debt figures focused on public and nonprofit colleges, which award the majority of four-year degrees. The Minnesota Office of Higher Education included private for-profit and nonprofit Minnesota institutions in its data.

The institute acknowledges that many students who do not graduate also have loans.

Pogemiller said students who do not graduate find it harder to pay off their loans because it is more difficult to find a good income.

Minnesota students are less likely to default on their loans compared with students in other states. The U of M saw the lowest default rates for its students while two-year state colleges had the highest, according to the state office of higher education.

'It's just terrifying'

Just this week, 23-year-old Cara Luebke of Maple Grove, Minn., got the bill for her first student loan payment: $348 a month. "In one word, it's just terrifying," said Luebke, a 2015 graduate of Winona State University who lives at home and works three jobs. "There's simply no feasible way for me to make that payment at this time."

So she took little comfort from the news that, for Minnesotans at least, the median student loan appeared to be leveling off. "It's so high that it provides an insane amount of stress," said Luebke, who is state chairwoman of the 70,000-member Minnesota State University Student Association. "This is one of our top student concerns."

Last spring, the Minnesota Legislature voted to freeze tuition at the state's 24 community and technical colleges for the third year in a row, about $4,600 a year, and to freeze tuition next year at seven state universities, which cost an average of $7,016 a year.

But Luebke says there's widespread feeling among students that that's not enough. "They go to a state university because it's supposed to be more affordable," she said, but they still end up with tens of thousands in debt. "I really just think the biggest problem ... is we need to see more investment from the state."

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