2.8 Million Seniors Have College Debt

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The number of Americans over age 60 who are paying back federal or private student loans has reached a critical mass, quadrupling to 2.8 million over the past decade, a new report finds.

These older borrowers owe $23,500, on average, and two-thirds of them also have mortgages and credit card bills at a time their medical expenses are typically increasing, according to the report issued this month by the Consumer Financial Protection Bureau (CFPB). Separately, nearly 40 percent of those with federal loans have defaulted on their payments.

The response of many older student loan borrowers, the CFPB said, is to “skip necessary health care needs such as prescription medicines, doctor’s visits, and dental care because they could not afford it.”

Suzanne Martindale, a staff attorney at Consumer Reports, said CFPB’s report illuminates the link between the country’s college debt crisis and the retirement crisis.

Indeed, more than 2 million of the 2.8 million older borrowers took out loans to pay for their children’s or grandchildren’s educations, CFPB said.  Relatively few owe money for their own or a spouse’s education, which was typically obtained when college was still affordable for a middle-class family.

The federal government garnishes the Social Security payments of those in default on federal student loans.  About 115,000 people over age 50 are having their Social Security old age, disability, or survivor benefits reduced to pay off loans, according to a Government Accountability Office (GAO) report last month cited by CFPB.  Half of the reductions in Social Security benefits were the maximum allowed, or 15 percent of benefits. Most of the defaulted federal loans were taken out to pay for their own – and not an offspring’s – education, CFPB said.

When older people co-sign private student loans, other problems arise.  More than half of all co-signers nationwide are now over age 55, the agency reported.  With the private loans come the now-familiar complaints about servicing problems. These include improperly allocating older people’s payments that should be going toward their own loans to the former students’ separate loan balances. Other problems are a failure to provide older borrowers with loan and payment information they have a right to know and aggressive debt collection practices, the CFPB said.

The servicing problems also “exacerbate older borrowers’ financial distress,” the CFPB said.

The CFPB’s rather dry accounting of one aspect of the student loan crisis indicates more trouble swirling below the surface for growing numbers of retirees.

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Aptitude Questions

One must keep in mind their budget and then spend accordingly.

    Pete W.

    Very helpful.


Sorry I fit the bill: I had no loans all the way through PhD. I am almost through paying for one child at age 70 also a mortgage and health challenge. It is tough!

Dave G.

And yet, we are told to believe the CFP is unnecessary!

I also wonder how many folks skipping their medications know of Patient Assistance Programs offered by a number of drug manufacturers? I’ve helped several seniors recently apply for programs with Lilly and Sanofi. The programs are geared to expensive drugs for specific chronic conditions like diabetes.

You can get info and free help from the Partnership for Prescription Assistance (PPA). They are an excellent resource on drug companies offering help. Unlike other online “resources” who charge fees, PPA never charges a fee for their help. The website is http://www.pparx.org. (I am not affiliated with PPA in any way….just use them as needed.)

You do not have to be Medicaid eligible for most assistance programs. Income to qualify generally capped at 250-350 percent of the Federal Poverty Level (FPL), depending on the drug and manufacturer requirement. There is generally no asset test. Enrollment does not replace nor conflict with any other drug plan you may have including Medicare Part D. The assistance programs can help defray costs not paid by your drug or medical plan.

I hope this is helpful to you or someone you know.

James Dixon

Good intentions often lead to unintended consequences. Student loans work well when the college education is completed and leads to well-paid employment. But, too often it leaves students with the burden of huge debt when they are unemployed or under-employed. I also consider student loans as the primary driver for runaway inflation of the cost of college education, from tuition to textbooks.


I knew early on that a college education was important, but I also knew avoiding debt was even more important. I paid cash for all of my college expenses for both myself and my children. I worked full-time and attended college full-time. It was tough, but it helped make me the person I am today. And upon my recent retirement, I do not have to be concerned about having to pay back student loans from Social Security, etc. Student loans are a real pit fall and young people have to understand that educational institutions are a “for profit” enterprise that leverages both state, federal and privatized monies. Examine your return on investment when it come to selecting your area of study, so you can effectively market your education.


Unless someone thought they were getting free money, paying back a loan is a given. And if they co-signed a loan for their kid and they are paying it back, the question becomes what type of kid saddles their parents with their loan?

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