Senior Americans Burdened With Student Debt

Sep 11, 2014 by

Rosemary Anderson could be 81 by the time she pays off her student loans. After struggling with divorce, health problems and an underwater home mortgage, the 57-year-old anticipates there could come a day when her Social Security benefits will be docked to make the payments.

Like Anderson, a growing percentage of aging Americans struggle to pay back their student debt. Tens of thousands of them even see their Social Security benefits garnished when they cannot do so.

Among Americans ages 65 to 74, 4 percent in 2010 carried federal student loan debt, up from 1 percent six years earlier, according to a Government Accountability Office report released Wednesday at a Senate Aging Committee hearing. For all seniors, the collective amount of student loan debt grew from about $2.8 billion in 2005 to about $18.2 billion last year.

Student debt for all ages totals $1 trillion.

“Some may think of student loan debt as just a young person’s problem,” said Sen. Bill Nelson, D-Fla., chairman of the committee. “Well, as it turns out, that’s increasingly not the case.”

Anderson, of Watsonville, California, amassed $64,000 in student loans, beginning in her 30s, as she worked toward her undergraduate and graduate degrees. She said she has worked multiple jobs—she’s now at the University of California, Santa Cruz—to pay off credit card debt and has renegotiated terms of her home mortgage, but hasn’t been able to make a student loan payment in eight years. The amount she now owes has ballooned to $126,000.

“I find it very ironic that I incurred this debt as a way to improve my life, and yet I still sit here today because the debt has become my undoing,” Anderson said in prepared testimony for the hearing.

Despite not making payments, she’s managed to keep the education debt in good standing, she said.

Ed Boltz, a bankruptcy attorney in Durham, North Carolina, who is president of the National Association of Consumer Bankruptcy Attorneys, said in an interview that many of the seniors he sees with student loan debt are also struggling with challenges such a medical problems, job loss or divorce. Some, he said, went back to school with hopes of making a higher salary and that didn’t pan out, or the children they helped fund to attend school are not in a position to help the parent in return.

“They are stuck with these debts and they can’t try again,” Boltz said. “There’s no second act for them. It holds off on people retiring.”

via Senior Americans Burdened With Student Debt – Higher Education.

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