The structure of attitudes to student debt

We examined the structure of attitudes to debt among current and prospective New Zealand tertiary students. Study 1 employed exploratory factor analysis to investigate the structure of debt attitudes of 1232 respondent in their final year of secondary school; Study 2 used exploratory factor analysis to investigate debt attitudes of 125 first-year university students. Both studies indicated that, contrary to what was assumed in the past, the structure of these attitudes is not unidimensional and is reasonably described by two dimensions, Fear of Debt and Debt Utility. In Study 3, confirmatory factor analysis indicated the superiority of the two-factor solution for the attitudes to debt of a sub-sample of Study 1 questioned a year later. The two factors have somewhat different relationships with other variables. Study 3 also showed that on average, longitudinally, the students became less debt fearful between the end of secondary school and the end of their first year or tertiary study but their views as to the utility of debt remained unchanged.