Some senior citizens face an alarming amount of student loan debt. As a result, those already on a limited fixed income are facing even greater financial stress. A recent article in Money magazine detailed this trend in the student loan universe. Money reports that “over the past decade, people over the age of 60 had the fastest growing educational loan balances of any age group, according to the Federal Reserve Bank of New York.”
Facing student loan debt as you enter retirement is daunting, and yet this population accounts for approximately $58 billion of the total student loan debt in the United States. For these unhappy borrowers, a percentage of tax refunds, wages, and Social Security can all be garnished to collect on federal student loans. In a household with a fixed income, this can be devastating.
Philadelphia’s own Joanna Darcus of Community Legal Services works with low income clients facing student loan debt. She stated that her clients viewed education as “a pathway out of poverty and toward financial stability, but their reality is much different from that,” As Money reports.
While there are government initiatives to ease student loan debt by providing income based repayment plans and the option to discharge federal student loan debt in bankruptcy, it is unclear how this will affect older borrowers.
Retirement should be a time when a lifetime of work is rewarded. Instead, a growing number of people are faced with a debt that is crippling their ability to meet basic needs.
Lead Consumer Advocate, Steve Harvey Law
Photo credit: CREATISTA/Shutterstock.com