Student loan debt a heavy burden for older Americans
DID YOU THINK student debt was just for millennials? Think again: Student debt among older Americans has grown from $3 billion to $18 billion in the last eight years, and the percentage of people unable to pay off those loans has more than doubled, from 6 to 12.5 percent, according to the Consumer Financial Protection Bureau. More than a quarter of federal loans owed by borrowers ages 65-74 are in default, and more than half of those held by people 75 or older are in default.
In fact, student loan debt is growing fastest among Americans over age 60, according to the Federal Reserve Bank of New York. As a result, many older people postpone retirement, avoid big purchases and scrimp on expenses. Some have their Social Security payments garnished—payments they rely on for basics like mortgages, property tax, rent, medical expenses and food.
“Why is all the talk about young people and educational debt?” asks Nancy Castleberry, a member of the Austin Community College/AFT who teaches incarcerated youth and adults in a probationary rehabilitation facility in Texas. “I’m 67 and have over $65,000 in student debt that’s growing.” Though she has requested a full-time position, Castleberry still works on a part-time basis and struggles to make ends meet for herself and her son. “The debt just keeps growing,” she laments. “What about loan forgiveness for me and others like me?”
Castleberry is not alone: Baby boomers and other older Americans are haunted by loans they took out decades ago, loans for courses taken during a mid- or late-career switch, or parent loans taken to educate children or grandchildren. Some will qualify for loan forgiveness or income-based payments. The rest may be working—and paying off their debt—far longer than they’d imagined.