Drowning in a sea of debt: more students are taking out college loans, and for greater amounts than ever. Some are asking whether it's worth it.

• Author: Winter, Greg

Every so often, when the phones grow quiet, Margot Miles glances at the lawyers working around her and thinks: "I could do that. I would love to do that." She smiles as she envisions life as a lawyer--fighting injustice, changing the world--until she remembers having $25,000 in undergraduate loans.

"I say to myself: `One day I'm going to do something phenomenal with this phenomenal education. I have to,'" says Miles, a legal secretary who graduated from the University of Pennsylvania five years ago. "But it's just so hard to imagine taking out any more loans."

In their trek through college and beyond, student borrowers now amass an average of $27,600 in educational debt, almost three and a half times what they compiled a decade ago, according to a new survey by Nellie Mae, the student-loan company. And as college tuition has climbed, so has the number of students who borrow to help pay for it. Ten years ago, about 46 percent of graduating seniors had taken out educational loans, according to the National Center for Education Statistics. By 2000, the figure was roughly 70 percent.

The growing debt has begun to encroach upon other major purchases, such as homes, and compels more than one in six borrowers, like Miles, to revamp their career goals to pay off loans, the survey found. What's more, fewer students than ever say that taking out college loans was worth it.

LOANS REPLACE GRANTS

When Nellie Mae asked its borrowers a decade ago whether the benefits of their educational debt overshadowed the downside, nearly 75 percent gave a resounding yes. Now, the figure is just 59 percent--a warning sign that students might begin shying away from universities, or at least the more expensive ones.

"What's so worrisome is that for the first time, a lot of students are questioning whether they should have borrowed so much money," says Sandy Baum, an economics professor at Skidmore College in New York. "what will happen when people decide it's not worth it and won't go to college at all? We're not there yet, but we're really dose."

Even after adjusting for inflation, the tuition and fees at private and public universities have more than doubled in the last 20 years. Although grants have increased as well, they have not nearly kept pace with the cost of higher education.

The outcome is that loans have essentially swapped places with grants on the seesaw of educational finance. As recently as 10 years ago, for example, loans accounted for a little more...