Student Loan Debt Extends to Senior Citizens

Student loan debt issues have been in the news often in the last several months.  The three key issues have been: 1) student loan debt has surpassed credit card debt and is now $1 trillion, 2) the  attendance in college has increased and they have been staying to earn advanced degrees because of the job market, and 3) the rising cost of education.  More students have had to finance education because of the reduced number of scholarships, increased cost of education, the limited number of part time jobs to help pay for college, and/or the limited or lack of funds their parents have to pay for their education.   The average student loans debt is over $25,000 and has increased 25 percent in the last ten years.

60 years old and above owe on student loans

In fact, some adults 60 years and older are still paying their college loans from early in life or from attending college later in life.  Others in this group are paying education loans they co-signed for their children and/or for their grand children.

According to research conducted by the Federal Reserve Bank of New York using Equifax consumer credit data, Americans 50 years and above owe $135 million in student loans debt as of third quarter 2011. Those 60 and older owed $36 billion in student loans, and 5.4 million or 14.4 percent had at least one past due student loan account.  Of the $85 billion of student loans past due in third quarter 2011, 4.8 percent were from those 60 years and over. The breakdown of older student loan borrowers by age were: 60 years and older represented 5.3 percent; 50 to 59 years of age were 11.8 percent; and 40 to 49 years of age were 14.8 percent.

Since federal student loans cannot be included in bankruptcy, they can follow you your entire life.  Dick Durbin, U.S. Democratic Senator, introduced legislation to include private student debt loans in bankruptcies.   The bill does not include federal student loans.

If I’ve said it once I’ve said it a million times…you’re going to pay your student loans…or die with them.

Credit Expert Witness, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

Categorised in: Debt, Government, Money & Identity

This post was written by John Ulzheimer