NEW YORK ( MainStreet) — The start of a new year may signify new beginnings for many, however it also often brings old demons to recent college graduates.

January typically represents the end of the six-month grace period for most of the recent class, and this year the Project on Student Debt survey says college grads now owe more than ever — nearly $30,000. In fact, school loans are now the largest form of consumer debt other than mortgages.

The recent report, furnished by The Institute for College Access and Success, said 2012 college graduates who borrowed for bachelor's degrees had an average student loan debt of $29,400. Also, seven in ten 2012 college graduates had student loan debt. The study also showed while there has been a steep decline in private education lending during the down economy, one-fifth of debt was in private loans — typically more costly — instead of federal loans.

From 2008 to 2012, average debt increased an average of 6% each year, the study showed.

"Debt at graduation continues to increase year after year, with no end in sight," said Mark Kantrowitz, senior vice president at Edvisors Network Inc., a family of educational resource sites. "The failure of grants to keep pace with increases in college costs is a key driver of debt at graduation. Family incomes are flat, so they must rely on financial aid, and the only source of aid with any degree of elasticity is student loans."

According to Kantrowitz's own research using the National Postsecondary Student Aid Study, 2012 graduates owed more than $35,400 on average, while 2013 graduates owed more than $37,600.

What may be worse for many is unemployment for recent grads still remains high. In 2012, 7.7% of young college graduates were unemployed, and 18.3% were either unemployed, working fewer hours than they wanted or had given up looking for a job.

Nevertheless, young adults without college degrees face far worse employment opportunities, with 17.9% of high school graduates with no college degree unemployed in 2012.

"Despite discouraging headlines, a college degree remains the best route to finding a job in this tight market. But students and families need to know that debt levels can vary widely from college to college," said Lauren Asher, president of The Institute for College Access and Success. "If you need to borrow to get through school, federal student loans are the safest way to borrow. Whatever you earn, income-driven plans like Pay As You Earn can help keep federal loan payments manageable."

Kantrowitz said the bet advice is obvious — avoid debt.

"Students should borrow no more for their education than their expected annual starting salary," he said. "If total student loan debt is less than annual income, the borrower will be able to repay the debt in ten years or less. Otherwise they will struggle to repay the debt and will need an alternate repayment plan, such as extended repayment or income-based repayment, to afford the monthly loan payments."