(FinancialHealth.net) – It’s no secret that student loan debt is impacting millions of Americans. However, the fastest growing group with massive amounts of this debt isn’t current college students, it’s people aged 60 and older.
Baby Boomers who took loans out to send their kids or themselves to school are trying to figure out how to handle the debt when they retire. More than 2.8 million older Americans are dealing with student loan debt.
Many assume that #StudenLoanDebt is only an issue for #Millennials but that is simply not true. 34% of Generation X and 29% of Baby Boomers are burdened by student loan debt. Learn how @Fidelity is working to lighten this burden here: https://t.co/6LJ7a89uOu pic.twitter.com/6C82g3r7ER
— FidelityNews (@FidelityNews) February 18, 2020
The average amount Baby Boomers owed from 2012 to 2017 nearly doubled from $12,100 to $23,500. According to the Consumer Financial Protection Bureau, older people owed roughly $66.7 billion.
That’s a lot of debt to carry into retirement. If a person fails to make their payments, the government can reduce their Social Security benefits by up to 15%. Currently, about 40% of borrowers in this age group have defaulted on their loans. As a result, many Baby Boomers are going to have to continue to work or see their monthly incomes dramatically decrease because of the repayments.
If you’re considering taking loans out, the best way to protect yourself is to make sure you factor your retirement income into the equation. You may want to carry the burden for your kids, but it might not be what’s best for your financial future.
~Here’s to Your Financial Health!
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