Seniors Hit With Student Loan Debt
Gotta favor to ask you. I’d like you to form an image in your mind of a typical person dealing with student loan debt. Got it? Good.
Now, let me guess. You’re picturing a college-educated young man or woman, perhaps with a concerned look on their face. Right? And no wonder they look concerned, considering the outrageous cost of college these days.
While the image you formed in your mind may be accurate for the “typical” person trying to figure out how they’re going to pay all that debt now that they’ve graduated from college, it doesn’t tell the whole picture. Not by a long shot.
That’s because the fastest growing group of student loan borrowers are – drum roll, please – age 60 and older. Say what? Yep, according to a new report from the Government Accountability Office, there are 2.8 million people 60 or older carrying $66.7 billion in student loan debt.
How could this be? Well, some seniors are recent college graduates, but the biggest reason for this situation is that many folks 60 or older are shouldering student loan debt that was accumulated by their children or grandchildren. These older folks either borrowed money themselves to help their kids or grandkids, or they co-signed for a loan.
In addition to being saddled with debt when many of us don’t have the same income we used to have, the report says that some older folks with federal student loan debt they can’t pay back are having money deducted from their Social Security payments by the government.
I’m not sure there’s a moral to this story. We all want to help our children and grandchildren as much as possible. But the advice here is don’t take on more debt than you can handle. Life is tough enough when you’re a senior.
Since you did not show where you received your numbers… Following is the link to the GAO report. http://www.gao.gov/products/GAO-17-45
The GAO is making recommendations for congress to write new laws to help.
Who is to blame? It is everyone’s personal responsivity to take on debt only when they can afford to pay it back.
Should Social Security Benefits be limited when a debt is owned? Probably no … as Social Security was created for continuing income after retirement and to help with pensions in old age.
What is the solution? Blame someone else, a different generation or another political party for your bad planning or bad “luck.”
I paid for my college education and I worked my tush off doing it too. After classes I went to work until 0100 hours. Then I would study when I got home. My weekends and spare time was studying. I didn’t go out to drink or hang out with friends. I saved every pennies and dime, paid low rent in a poor neighborhood, and starved for the most part. It was a great time for me. I lived modestly and had fun doing it. I didn’t have the luxury of depending upon my family for support. What I did was to live my life knowing that I only had myself to depend upon. It has made me the man I am today.
I can’t blame the government for this problem except that they really didn’t explain the consequences very well to those that took the money. No one held a gun to the students head and said take the money. It was up to the student to understand that as soon as they were out of school that their student loads were due and payable. Instead of fulfilling their obligations of paying on their student loads that thought that they had time to pay it back or not to pay at all. A lot of people felt that the government owed it to them to pay for their college education. In fact a lot of people fail to pay on their loans for thirty plus years.
Now that they are in their golden years of retirement they are shocked and surprised as well as dismayed that they must pay back their student loans. Who’s fault is it for not paying on their student loans and allowing it to run out of control? I guess they still have a lot of growing up to do and learn that what is owed must be paid; if not today then sometime later down the road. These are the same people that used their credit cards to live a life style that they couldn’t afford then filed for bankruptcy.
The only emotion I feel for these people is one of regret that they didn’t take a college course in finance or learn from their parents or grandparents that if you take on an obligation then you must honour your obligation, failure can have grave consequences. So now these AARP candidates must pay back their loans before taking any Social Security payments. I suggest that they look for a part time job or sell something that they have to pay off their debts. After all, the standards are not that high when the student needed the money. If the student needed a college education but couldn’t afford it they took out a student loan. If the student had to loan someone the money to go to college they certainly would want to be paid back! That is all the government is doing, asking for their money back.
I have learned there is always a price to pay when it come to dealing with the government. That is why I have learned to be an independent man and earn or work hard for what I want in life and not rely on anyone or any government for assistance which I can not afford to pay back.
It seems like you don’t retain mentally what you read!! It said that at least 60% co-signed or help their kids or grand-kids get a loan. And maybe the kids haven’t been holding up their end of the bargain? What are they gonna do..put a gun to their heads? Just remember what ya read please?
In my case..after I obtained my degree..I became totally disabled…now what to do? But I did some research & found out that if you become disabled…the loan amount is “forgiven”!! WRONG!! The government doesn’t play by the rules..they take it anyway!! Now again…what to do..except try and fight the government!! And how effective do you think this is? So before you go “flapping you gums”…UNDERSTAND WHAT YOU READ!!
Bill, Thank-you for your comments. The point that I was making was that I made my own way through college on my own. My parents couldn’t or didn’t help me pay for college. I worked hard, I worked long, and followed through my goal of getting an college education. I could have gotten a student loan; but, I read the contract and asked questions before signing anything.
When the contract said that interest would not accrue until I left school, I realized that the lump sum owed on $30,000 would be more than I could handle. It would take me at the very lease 20 plus years just to make the payments. I am not in the habit of stealing from my future to pay for my past. If I don’t have the money, time or energy to buy or do something then I will save for it until I can truly afford it.
This is what is missing with our kids today. They are use to instantaneous gratification without repercussions or accountabilities for our actions. Kids expect their debts to be paid my their parents or be forgiven – for whatever reason(s). Then when that doesn’t happen they cry the boo-who-blues. And Bill, I hear you crying.
I’m sorry to hear that you are disabled. But your disability doesn’t and should preclude you from paying back your student loan, after all the government isn’t your parent(s) and you had 20 plus years to pay it back but didn’t. You have a brain, you got a degree; but, if you couldn’t utilize your degree then you should have thought your way through your situation and made money by thinking. I tell my kids that the strongest and best muscle that they need to exercise is the one between their ears. The muscles in their arms and legs may fail but it is their brain that will get them through the tough times in their lives. “So, before you go “flapping you gums”… DID YOU UNDERSTAND WHAT YOU READ!!” before signing your student loan?
You all bring up excellent points. Did you know that a lot of people my age, late 40s, are being encouraged to take student loans for a career change? The government can take them off the unemployment charts, saddle them with debt, for a job that might not materialize at their age, and revoke chunks of social security. I see a lot of people in a certain demographic falling for it. They are so excited to get 18 months or two years education even, for jobs that are not there, and I wonder where is the spirit of the American entrepreneur?
Angela, you bring up a lot of good points. The government has money to give away for all those that apply and qualify for it. The Government wants to give it away because they have a major problem called “Use it or Lose it.” This means that if a government program doesn’t use the money that has been allocated to it, when appropriations time comes along in October, that program will lose that money and the program will only receive that in which has been already spent for the year. So, if more money is needed to serve more people the greater the budget for that government program. Case in point, student loans. If people stop getting government loans for college then the allocation for student loans decrease.
The wonderful thing about a college loan is that a student can go through college and earn a degree. The bad thing about a student loan is as long as a student remain in college there is no interest charged on the loan. When the student get out of college then six months later the loan becomes due with interest.
The government expects you to get a job and start paying back the loan ASAP. This is where people screw up – they fail to pay back the loan, they fail to make payments on the loan which in turn snowballs into a uncontrollable financial mess.
So the government doesn’t really care if you can repay the loan – that is another department’s responsibility to worry about. Their only concern is to dole out cash to anyone that is willing to accept it with all the conditions attached to it. It is up to the borrower to figure it out as to whether it will fit his needs or not. The government didn’t put a gun into the borrower’s hands and say, “Take this money or else.”
Asian families have a system which they employ to put their children through school. All kids work. They money they earn goes to help pay for the oldest child’s college education. When that child graduates they are expected to help pay for the next child to go to college, and so on. This way the burden is spread throughout the family and the burden is shared by everyone. The child that is getting the benefit of going to school has the burden to pay it forward for the next child and so on. The Asian’s employ the same technique for getting their children a home to live in. Believe it or not this works. American children on the other hand expect to go to school without having to pay back any monies to their parents or the agency that had loaned them the money in the first place. They expect that it should be free and that they are not held accountable or responsible for the debt. In short the child doesn’t have a single tie of obligation or responsibility for the loan until they realize that 40 plus years later the debt is still present and still payable. If the borrower couldn’t pay for the loan during a period of prosperity in their life time; then the government will take it in their golden years of retirement with interest. It sucks being a deadbeat – lesson learn.
Like Angela has stated, “where is the spirit of the American entrepreneur?” If the student got a degree using monies received from the government then they should be paying the loan back ASAP in any and all possible ways necessary.
If the student is working in a job that isn’t in their field of study they still have an obligation to pay back their loans. It may be hard and may be tough and it may take some time but it can be done if they set their minds to it before setting up a house and family.
The government is to blame for this because of the policy that children are considered dependents until they are 24 years old, married, or have a child. Even if kids qualify for student loans, if they don’t have enough to cover all of their expenses, the parents are expected to get a PLUS loan. Only if the parents can’t qualify are the students allowed to get an additional loan. My parents didn’t pay for my school. I encouraged my children to get good grades and apply for scholarships. Paying for their higher education is their responsibility, not mine. Paying for your child’s education is something that only the rich can afford.
You bring up a good point about the cost of an education. It has risen so dramatically over the last few decades, but the quality of the education has not risen along with it. Like anything else one buys, it’s best to make sure you’re getting value in return.
There is no good reason that it should cost so much for college. Students are being forced to pay for the cost of giving free rides to athletes. Such Free rides must be stopped, and overall costs must come down or better yet eliminated all together. Tax payers pay for education of our children up through high school. Why should it stop there? Making sure our people are well educated and trained strengthens and advances a nation.. Students must be held to achieve a certain grade average to maintain the privilege of attending. What we would get back from these students as they join the work force and communities would be far more relevant and productive, than being burdened by loans.