How much of your paycheck goes to student loans?

Imagine being 24 or younger and dedicating 16.8% of your take-home pay to your student loan payments.

It's quite a chunk of change. We could be talking about $560 a month in student loan payments, for example, for a couple with a $40,000 take-home income.

But that's exactly what's happening to some borrowers. A quarter of Chase account holders aged 18 through 24 are dedicating at least 16.8% of take-home income to student loan payments, based on a new study by the JPMorgan Chase Institute.

The study reviewed activity in Chase checking accounts from October 2012 through July 2018. The researchers identified 4.6 million families who had made at least one student loan payment out of their accounts. Data could take into account fluctuations in take home pay, as well as when payments were being made on student debt and when they weren't.

"We think it's a unique lens," said Diana Farrell, president and CEO of the JPMorgan Chase Institute, which is a think tank dedicated to providing expert insight to help policymakers, businesses and others make more informed decisions.

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Most people already know the big scary numbers, the $1.5 trillion dollars in overall student loan debt that challenges 45 million borrowers. So it's interesting to be able to take a look at what's happening on at checkbook level.

The good news is that the institute's data shows that overall many people are able to deal with their student loan debt. The typical family's median loan payment was $179, or 5.5% of take-home pay, which might seem very doable.

But digging deeper into the data, the researchers found that the financial burden for young and low-income families was far greater.

How much is too much student debt?

One in four families with an annual gross income of $50,000 or less, for example, spends 14.7% or more of their take-home pay on college loan payments. Again, that's a fairly good portion of your budget.

To be sure, a college degree is essential for many jobs that ultimately can pay $70,000 or more a year. After stringing together a lifetime of paychecks, the financial returns from a college diploma can exceed the costs.

As a result, taking out a modest amount of student loans can make a great deal of sense for those who graduate from college and build careers.

A good rule of thumb is to aim to have total student loan debt at graduation that is less than your annual starting salary, according to Mark Kantrowitz, publisher and vice president of research for Savingforcollege.com.

“If total debt is less than annual income, you should be able to repay your student loans in 10 years or less,” he said.

Yet student loan debt doesn't fall into a one-size-fits-all narrative.

Some students don't graduate and they're stuck with the debt anyway. Others may find it hard to find consistently good paying jobs. Others opt for careers in low-paying fields.

It's essential to understand what's happening to the cash flow of families who take on student debt.

Remember, it's not just the college graduate — or the person who dropped out of school — making those payments.

Roughly 19% of individuals report receiving help from others to pay off their student loans. And 9% of borrowers owe money for the college debt of a spouse, partner, child or grandchild, according to other research

Some families just can't handle the debt load each and every month.

One in four families, across all ages and incomes, spends more than 11% of their take-home income on student loans. And many are spending more on student loans than they are on necessities, such as out-of-pocket health care expenses and fuel.

"For some segments, it's just too high," Farrell said.

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Paying consistently helps eliminate the debt

The stress goes up when someone's monthly take home pay fluctuates — as it often does for many people.

"When income changes take place, people just don't pay their (student) loans," Farrell said.

Overall, 54% of families make consistent payments by paying down their student loan debt month after month almost all of the time, the research concluded.

But only 44% of low-income families make such regular payments. That compares to 63% of high-income families.

"Student loan payments are sensitive to large income changes," the report noted.

In the face of a job loss, for example, student loan payments fall by 7% and then by 27% once unemployment benefits expire.

A family might opt to pay the rent, the mortgage or a car loan first, calculating that the risks are far higher than skipping a student loan payment. After all, a car can be repossessed.

Surprisingly, many people don't understand how their interest will accrue when they're creating their own sort of pay-as-you-go plan to tackle their student loans. It becomes far harder to make headway when payments aren't prioritized or aggressively made.

For borrowers, the interest will keep building as they skip making student loan payments or pay less than they typically would in a given month.

Some young consumers don't even understand how a student loan works. I spoke with one high school student recently who didn't realize taking out $10,000 in most types of student loans means you're going to owe far more than $10,000 after the interest accrues.

To be sure, the federal student loan program offers income-driven repayment options that can help lower monthly payments. See StudentLoans.gov.

Yet some experts see evidence of low enrollment in such plans among young and low-income borrowers, according to the Chase institute's research.

Some people don't understand the plans or don't choose the correct one for their families. Others just don't even know that they exist.

Contact Susan Tompor at 313-222-8876 or stompor@freepress.com. Follow her on Twitter @tompor. Read more on business and sign up for our business newsletter.

This article originally appeared on Detroit Free Press: How much is too much for student loan debt?