Source: Federal Reserve Bank of NY
With student loans now topping $1 trillion which exceeds credit card debt and auto loans and 20 million people past due – student loan debt is proving to be one of the major issues of our time. When people think of student loans – they usually think of college kids; not so much…there are a whole host of people in various age groups still struggling to pay for access to higher education based on the promise of better jobs with better wages in the future. There is something very wrong with a system that still allows for people who are 60 years old and older to have $36 billion in student loans…and if they don’t pay – it will be garnished from their social security check.
Due to huge cuts in investment in education – college students are shouldering an ever larger burden of their tuition. In the past – American taxes paid for a great deal of the cost of college…now – it’s being paid with points. And as so called conservatives continue to pass tax cuts for the the wealthy and corporations – government services like subsidized college education (Pell Grants) go away. And as the loss of tax revenue grows – pressure builds on important safety net programs like Social Security which we all pay into. But we’re likely to see in the future is an entire generation of Americans whose who might never receive Social Security because of government garnishments due to student debt loans. Need to eat? Sorry – you went to college.
The Washington Post has the story:
New research from the Federal Reserve Bank of New York shows that Americans 60 and older still owe about $36 billion in student loans, providing a rare window into the dynamics of student debt. More than 10 percent of those loans are delinquent. As a result, consumer advocates say, it is not uncommon for Social Security checks to be garnished or for debt collectors to harass borrowers in their 80s over student loans that are decades old.
That even seniors remain saddled with student loans highlights what a growing chorus of lawmakers, economists and financial experts say has become a central conflict in the nation’s higher education system: The long-touted benefits of a college degree are being diluted by rising tuition rates and the longevity of debt.
Some of these older Americans are still grappling with their first wave of student loans, while others took on new debt when they returned to school later in life in hopes of becoming more competitive in the labor force. Many have co-signed for loans with their children or grandchildren to help them afford ballooning tuition.
To find out more about the chart below you can read “The Next Bubble Burst: Student Loans”
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