CINCINNATI, Ohio (USA Today) -- Mary Knauff would like to start saving money, for retirement or for some future spending.
But because of about $28,000 in student loans, which she's paid down to about $17,000, the 2010 Xavier University graduate will continue living paycheck to paycheck.
"It's sort of disheartening," said Knauff, 25. "I knew going in that I was going to a private school. Especially when you're trying to get started, when loans take up a third of your living expenses, it's frustrating."
That delay in buying cars and condos, in starting families and savings accounts, reveals the true cost of student debt, to graduates such as Knauff and to the larger economy.
Even as Americans held overall consumer debt to a 9 percent increase from 2004 to this year, student debt tripled to $986 billion after adjusting for inflation, according to an Enquirer analysis of Federal Reserve Bank of New York data.
It's now 8.8 percent of all consumer debt, up from 3.1 percent in 2004.
A system that pushes students to borrow whatever they need to get through college has come under increasing scrutiny as college gets more expensive and a new generation of students is hamstrung by larger and larger debt loads.
"You may be unable to save, unable to put away money for retirement," said Rohit Chopra, student loan ombudsman at the federal Consumer Financial Protection Bureau, in an interview. "Many borrowers are telling us their dreams of owning a home or starting a small business may be out of reach."
The fallout ranges far beyond students and their families. With spending, debt and tuition all escalating, experts fear the inflation of a "college bubble" that could pose dangers for the national economy, much like the Internet bubble in 2000 and the housing bubble in 2009.
For thousands of college graduates, Knauff's story is typical.
These aren't the horror stories of graduates with $100,000 or more in debt from an elite college, running up bills they'll never be able to pay.
Instead, students near the average debt of $26,600, for the 65 percent of graduates who take out student loans, put off spending or saving. That dampens growth in the local economy, but it also defers and sometimes destroys their own dreams of a career or a lifestyle.
In 1993, only 46 percent borrowed an average $9,350, according to the Project on Student Debt.
Of those carrying student debt, about 40 percent say they have postponed contributions to retirement plans or delayed car purchases, 29 percent have put off buying a house and 15 percent have postponed marriage, according to a new survey from the American Institute of Certified Public Accountants.
Six in 10 respondents said they regretted their choice of college financing. The current spiral in student loans is feeding an ever-growing cycle of more spending, higher tuition -- and even more loans.
Experts say that could threaten the system of higher education that was built over generations, even causing some smaller or financially weaker colleges to fold.
But the impact on young people spreads quickly throughout the economy.
"We look to those younger generations to sort of sustain growth in the economy," said Amy Crews Cutts, chief economist at the credit reporting agency Equifax, noting the high unemployment rate for Americans younger than 25. "But they sort of over-invested in something that's clearly not paying off."
The warning signs are emerging, according to the New York Fed:
• More than 40 percent of 25-year-olds carry student debt, up from about 26 percent in 2004.
• About 17 percent of loans were delinquent at the end of last year, compared with less than 10 percent in 2004. When only loans in repayment are considered, about one-third are delinquent.
• Nearly half of borrowers have seen payments deferred, so they haven't even started repaying - or defaulting.
• The quarterly movement of borrowers to delinquency from repayment has accelerated to nearly 9 percent, up from 6.5 percent in 2005.
Congress and the Obama administration are considering reforms to the student-loan marketplace, hoping to both relieve the stress on college graduates and the strains on the larger economy.
"We've done some good things, but the problem is that it's still too much debt," said U.S. Sen. Sherrod Brown, D-Ohio.
Brown said legislation to keep interest rates on federal subsidized loans from doubling to 6.8 percent is important, as is pouring new money into the federal Pell Grant program for low-income Americans.
He's also sponsoring a bill that would allow students to convert private bank loans - often with substantially higher interest rates - to lower-rate federal loans.
So how much debt is too much?
Experts say they advise students not to borrow more than their expected first-year salary. Given the expected benefits of a college degree, that's a wise investment, they say.
"It makes no sense to say, 'I don't have the money now. I can't afford to go to college,' " said Sandy Baum, policy analyst for the College Board.
Tony Aretz, president of the College of Mount St. Joseph, compares it to another common transaction.
"It's equivalent to buying a new car," Aretz said. "I tell people, 'Take that money and invest it in yourself.'"
Graduates and students interviewed by The Cincinnai Enquirer say they were advised to borrow "whatever it takes," and few ever suggested they limit their debt.
"Nobody ever told me that," said Ashley Anderson, who graduated from the University of Cincinnati in 2010 and is paying more than $600 a month.
The impact on spending hits less than a year after graduation, once the loan payments start.
"In the grand scheme of reality, I should feel kind of lucky that I was able to pay for half of it," said Susan Osgood, who just graduated from UC last month.
"But at the same time, I think it's absolutely going to affect the decisions I make, at least until I figure out what I'll pay each month."
What's needed is counseling so that students understand how much they should borrow, said Bob King, president of the Kentucky Council for Postsecondary Education, the group overseeing public universities in the commonwealth.
He recalls that one member of his own family financed an overseas trip on student loans.
"For many of our students, we know that for the first time in their life, having access to what feels like free money causes them to make bad decisions," King said. "There's nothing they've done in high school that has prepared them for that."
Many students also don't know that student-loan debt is one of the few consumer debts that can't be discharged in most bankruptcies.
Even if students are only borrowing what they need, they say it's difficult to keep up. That includes books, which can run $1,500 a year or more, and other costs beyond tuition and housing.
Those young people acknowledge that they need more information.
"In hindsight, I'd go back and apply for a lot more scholarships," said Anderson, the first person in her family to graduate from college. "Right off the bat, my family fell into the middle-class, where we didn't qualify for (need-based) aid. We went in completely blind."
Anderson already has paid off about $10,000 in debt. She held a job all the way through college and lives with her parents in Dent.
"I live at home, just to be able to live at all," she said.