The Gender Pay Gap Can Affect Student Loan Repayment

ROHNERT PARK, Calif.-- Student loan debt is at an all-time high, and defaulting on these loans is usually an outcome born from a variety of factors. High debt and low income are big factors, but even gender can play a role in the ability to pay back student loans. Ameritech Financial, a document preparation company that helps borrowers apply for federal repayment plans reminds borrowers who are at risk of defaulting that there are available federal income-driven repayment plans (IDRs) that may help them improve their situation.

The gender pay gap, which is the difference between women's and men's earnings expressed as a percentage of men's earnings, shows that there is a huge earning discrepancy nationwide. According to Kathryn Vasel at CNN Money, "a woman working full time, year-round will lose more than $10,000 a year to the wage gap. That means that women will have less wealth, fewer resources for retirement, and it is one reason why women are likely to take time out of the workforce to do caregiving because they earn less than their male counterparts." This means that women have less money to save, and then have a higher chance of defaulting on their student loans.

"At Ameritech, we recognize the wage gap and that every borrower is doing his or her best to avoid default," said Tom Knickerbocker, Executive Vice President of Ameritech Financial. "When low income or high payments get in the way of that, IDRs may help. At Ameritech Financial, we help borrowers understand and apply for IDRs to help get them in situations in which they can better afford to make their monthly payments to their loan servicer."

Though it continues to cost more to be a woman, there are ways to counteract the gender wage gap. Alanna Vagianos at the Huffington Post wrote about how to close the wage gap. In her article, she encourages women to develop negotiation skills, speak out against the wage gap, and have all genders aide women to succeed in the workplace.

"Defaulting depends on a lot of different things, some of which borrowers can control and some that are out of their control," said Knickerbocker. "Addressing the wage gap can be valuable for lawmakers and states in order to address shortcomings in the system. Borrowers, no matter the gender, shouldn't feel like default is inevitable. With an IDR you can potentially lower your monthly student loan payments to offset costs that can be beyond your control."