Indiana’s average student loan debt among graduates of four-year universities is the 11th highest in the nation, according to a new report.

Indiana’s average debt was $27,500 last year, or $900 higher than the national average of $26,600, according to a report released last week by the Project on Student Debt.

The debt levels of students who graduate with loans continued to rise last year, the report said.

“Most students in the Class of 2011 started college before the recent economic downturn, but the economy soured while they were in school, widening the gap between rising college costs and what students and their parents could afford,” the report states. “State budget cuts led to sharp tuition increases at some public colleges, increasing the need to borrow.”

Nationwide, the debt load increased by 5 percent.

Indiana University Kokomo’s numbers fell below the national average, though, at $25,839.

That’s lower than the average debt at the Indiana University Northwest, East and Bloomington campuses but higher than the average debt at the South Bend and Southeast campuses.

Jack Tharp, senior director of financial literacy for the university, said mounting student loans are a concern across all IU campuses.

“We’ve got some work to do,” he said.

Tharp is tasked with managing a debt relief program IU unveiled earlier this year.

They’re making progress on the initiative, Tharp said.

All first-time students will soon be required to complete an online learning module about finances, budgeting and loans before they register for classes, Tharp said.

The university is also developing a one-credit-hour course in financial literacy. It won’t be required, but it will be available, Tharp said.

“We’re working against the clock to have it ready by next year,” he said.

Tharp said he hopes to unveil a new student-driven website about finances sometime next month.

It will feature blogs and forums where students can answer other students’ questions about anything related to money and finance, Tharp said.

He said the questions could be as simple as “How do I establish good credit?”

Maybe other students will want to know whether living in dorms or off campus is more cost effective.

“We want to engage students about the issues confronting them,” he said.

Tharp said he’s not entirely sure how Indiana got in the spot it’s in, having the 11th highest average student debt load in the country.

“That’s a tough question,” he said.

He said he thinks part of the problem is the state’s diverse network of community colleges and private and public universities.

Tharp said students have the ability to move around from campus to campus with relative ease. They’ll attempt degrees or programs at different colleges and then decide it’s not for them, he said.

“You can begin to accumulate a lot of debt,” he said. “We see students coming to us from Ivy Tech with a lot of debt. That affects our numbers.”

Ivy Tech Kokomo officials said the community college is still the best investment in higher education in Indiana.

Many students should be able to pay for their degree without loans.

With Ivy Tech’s tuition rates, a full-time student taking 12 credit hours, and receiving a full federal Pell grant award of $5,550 and an Indiana O’Bannon grant, can cover the full cost of their tuition, fees and books without taking out a loan, officials said.

“Unfortunately, even with our low tuition rates, some students still choose to take out student loans,” said Michelle Simmons, vice chancellor of student affairs for Ivy Tech Kokomo. “Our goal is to ensure that our students are educated and knowledgeable regarding their loan obligations.”

All new first time, full time students are required to attend a mandatory new student orientation session prior to registering for classes, Simmons said. Financial aid options, including student loans, are discussed during those sessions.

Financial aid advisors make presentations and distribute materials to all first year seminar classes, in hopes of increasing the students’ financial literacy, Simmons said.

“We also have taken a more aggressive approach in contacting students who enter default/delinquency status, over the last few years,” Simmons said. “We hope that all of these initiatives will assist in lowering the loan default rate of our students.”