Graduating with student loan debt is an all too common reality for new college degree holders beginning their careers. But there’s another, often overlooked cohort of debtors facing their own set of challenges: Americans over the age of 55 approaching their retirement years.
About 2.2 million people over the age of 55 have outstanding student loans, according to data from the Federal Reserve Board’s 2022 Survey of Consumer Finance. These older workers and unemployed people say the loans they took out years earlier could hinder their ability to retire comfortably, according to a new report from The New School’s Schwartz Center for Economic Policy Analysis.
“This is not a problem that’s going away… it’s only going to get worse,” the report’s author, Karthik Manickam, said in a press conference Wednesday to discuss the findings.
I don’t even have student loan debt and I struggle to save for anything.
Same. Everything goes to essentials like rent, food, and utilities. I’ve given up on ever being able to buy a home for my family.
The economy is so bad that student loans are just another drop in a very big, very full bucket.
How did the loan even wind up lasting that long in the first place? Shouldn’t the repayment terms have had it being paid off way before that? I mean, you’d have to have that loan outstanding for something like 40 years for it to reach retirement age. Even house loan terms aren’t that long.
kagis
Ah. Apparently federal student loans are normally up to 10 years, but the borrower can get them extended or refinanced. And a private loan could have whatever terms, and some of those run longer.
That’s also assuming those all reflect bachelors degrees. You can also get loans for asters, doctorates, medical, and technical degrees, as well as ongoing learning requirements
In my experience, the minimum student loan payments are less than the interest. So if you can only afford the minimum (or less than the interest) then the debt grows faster than you pay it off.
I just learned my 60 year old mother in law has been moonlighting as a janitor. Only learned because she injured herself in exhaustion. Her reason: needed the cash for her student loans.
If I lived in some city with a functioning socialist or democratic socialist government, with good public infrastructure, education, and health care, I swear like half my expenses would be gone. I spend more than $400 a month on a car payment (and that was after buying a used one many years old), a similar amount on a student loan, and about $300 a month on my auto insurance (which feels like it tripled recently this last year. Happening all over the west coast I’ve heard from others for some reason?). Plus there’s gas for my long commute, because I can’t afford to live near my work. Buying a hybrid car helped with that, but now I’ve got that car payment. Add in how much I pay for health insurance plus my HSA, and that’s basically a whole paycheck gone every month. It’s ridiculous when you think about it - that it doesn’t have to be that way.
