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More older adults facing significant student loan debt

Michigan residents who are considering going back to school should take note of a recent trend concerning student loan debt. It appears that the demographics of such debt are shifting, and that more older adults are facing student loan payments than ever before. One study asserts that Americans age 50 and older comprise as many as one fifth of total student loan borrowers, which equates some 6.8 million individuals.

Some of these borrowers are facing repayment obligations for student loans they co-signed for loved ones. When a child or grandchild is unable to pay for their student loans, the responsibility for those payments falls on the co-signer. In some cases, grandparents can find themselves paying for student loans when their grandchild never completed their education, at the same time that they are experiencing their own financial constraints.

In other cases, older adults are heading back to school to bolster their professional credential or to gain new skills to help them better compete within the workforce. This can be a wise investment, but it is important to go into such a situation with a solid projection of the eventual payoff. If an older student will face $50,000 or more in student loan debt but will have to aggressively compete for a job that pays $40,000 per year, the investment might not make financial sense.

As we age, all of us face the likelihood of higher medical costs. Many Michigan residents will also face reduced income levels when retirement arrives. Adding high levels of student loan debt to this mix can prove financially devastating to some individuals. It is also important to know that student loans typically cannot be discharged through bankruptcy (there is a hardship exception, though the guidelines are strict), and are also eligible for garnishment from an individual's Social Security Income. As with any large scale financial decision, it is imperative to weight all factors before acquiring new student loan debt obligations.

Source:, "College debt isn't just for kids: More older Americans saddled with student loans," Mila Koumpilova, Dec. 13, 2012

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