Student debt now affects a staggering number of elderly Americans
The number of older Americans taking on student debt on behalf of their children and grandchildren has quadrupled in the past decade, with consumers 60 and older now holding $66.7 billion in student loan debt, according to a new report by the Consumer Financial Protection Bureau.
The skyrocketing cost of college has placed a particular burden on older Americans, many of whom are struggling to pay back growing debts in their retirement years, the report said. Nearly 40 percent of federal student loan borrowers 65 and older are in default, the highest rate for any age group, the data shows.
“Student loan debt is clearly an intergenerational problem, and what we’re seeing is that this is unfortunately putting older consumers’ retirement at risk,” said Seth Frotman, assistant director of the bureau’s office for students. “Older Americans are struggling under the weight of student loan debt.”
Americans owe nearly $1.4 trillion in outstanding student loans. A slow job-market recovery, growing income inequality and stagnant wages have made it difficult for younger Americans to be economically independent, and there are signs that those financial struggles are dragging down their parents and grandparents as well.
“A large portion of older student loan borrowers struggle to afford basic needs,” the report said, adding that older borrowers were increasingly likely to have skipped necessary doctors’ appointments and prescription medications because they couldn’t afford them.
I tend to side with the Trump admins view of a repay program for student loans to be around 12 percent of income earned for 15 years. It beats people working to defer loans or paying minimums and remaining in debt for too long - not paying off the principle.
It’s sort of an investment program. Some will return more than others.
Trump said in an October speech in Columbus, Ohio, that he’d replace the current maze of plans with a single program. The plan would limit student loan payments to 12.5 percent of income, slightly higher than REPAYE’s cap, and forgive the remaining balance after 15 years, five to 10 years sooner than the current options offer.