Biden could wipe out 30 million student-loan borrowers' debt loads with $50,000 in relief — but $10,000 would still turn a third of their balances to zero

• New data from Sen. Elizabeth Warren's office highlighted the effect of student-debt relief.
• It found $10,000 in relief would erase debt for 32% of borrowers, and $50,000 would do so for 76%.

Any bit of student-loan relief would help borrowers. But new data found that the more forgiveness, the better.

On Tuesday, an analysis prepared for Massachusetts Sen. Elizabeth Warren and obtained by Insider found that if President Joe Biden fulfilled his campaign pledge to cancel $10,000 in student debt for every federal borrower, 32%, or 13 million borrowers, would see their debt balances turn to zero.

And with every $10,000 increment, the share of borrowers affected would only increase: $30,000 in relief would zero out balances for 24 million borrowers, and $50,000 in relief — an amount Warren and many of her Democratic colleagues have pushed for — would wipe out total debt balances for 76% of borrowers, or 30 million people.

"Our findings bolster prior research showing that debt cancelation would free millions of borrowers from financial burdens, help close debt and wealth gaps between Black and white households, and eliminate runaway student loan balances for distressed borrowers," said the analysis, prepared in part by Dr. Charlie Eaton at the University of California, Merced. "Higher levels of cancelation do more towards each of these ends. In sum, every dollar of student debt cancelation counts, but bigger is better for advancing racial equity and economic security."

The analysis also showed how influential broad student-loan relief would be for minority borrowers. $10,000 in debt forgiveness would wipe out balances for 2 million Black borrowers, and $50,000 in relief would reduce the share of Black people with student debt from 24% to 6%, narrowing the Black-white gap.

Warren has long been a proponent for broad student-loan forgiveness, not only because it would stimulate the economy but also because of the effect it would have on closing the racial wealth gap in the country, she said. This new data comes as Biden inches closer toward making a decision on debt relief. He told reporters last week that while he wasn't considering $50,000 in forgiveness, a decision on canceling student debt would be made "in the next couple of weeks."

The racial effects of student debt have also been a focus for other prominent lawmakers, such as Senate Majority Leader Chuck Schumer. In a recent opinion piece with Derrick Johnson, the NAACP's president, Schumer detailed how Black borrowers were more likely to take out student loans to begin with than their white counterparts, and while the median white borrower would owe 6% of their student debt 20 years after entering college, the median Black borrower would owe 95% of their debt over the same time period.

"This disparity is unacceptable," Schumer and Johnson wrote. "It is un-American. And at the current rate, it is entirely unsustainable."

It's unclear how exactly Biden plans to act on student debt, but reports have said he's considering at least $10,000 in forgiveness that may be subject to income limits. Still, as the analysis said, "every dollar of immediate debt cancelation counts, but bigger is better for racial equity and tackling wealth inequality."