We’ve talked about the staggering figure before: Americans owe $1.2 trillion in student loans. But one of the most compelling facts about this bubble, a recent government report found, is that this crushing debt doesn’t just affect the young. Senior citizens are also saddled with this financial burden — but they may also be the remedy to this crisis.
According to a Government Accountability Office (GAO) report, the federal student loan debt for Americans 65 and older has continued to rise from $2.8 billion in 2005 to a whopping $18.2 billion in 2013. Due to (frankly unreasonable) interest rates, an increasing population of older Americans can’t make their loan repayments: 4 percent of seniors now have student loan debt compared to only 1 percent six years ago.
About 80 percent of these seniors hold debt from their own education (versus college loans taken out for a child). Take Rosemary Anderson of Watsonville, Calif. The 57-year-old tells the Associated Press that the $64,000 debt she amassed from her undergraduate and graduate studies in her 30s has more than doubled to $126,000. Even though she has worked all her life, she could be in her 80s by the time she pays it all off. Unfortunately, if she doesn’t make the payments, she might default or see her Social Security benefits garnished by creditors. As a result, she might not have enough money to retire when the time comes.
Anderson is not alone. “As the baby boomers continue to move into retirement, the number of older Americans with defaulted loans will only continue to increase,” the GAO says. “This creates the potential for an unpleasant surprise for some, as their benefits are offset and they face the possibility of a less secure retirement.”
However, there might be a silver-haired solution. As Education Dive puts it, “seniors vote, and most successful politicians cater to seniors.”
A vast majority of seniors turn out to vote in each election (much higher than any other age group), which means that they also have significant political clout. Many senior citizens are also fiercely protective of the Social Security payments they receive from the federal government. So as more people see their money taken away due to unscrupulous lenders and predatory interest rates, they will demand reform. Politicians know they can’t upset this large voting bloc.
The public has been increasingly angry about mounting student debt, but there has been little government action to solve this enormously expensive problem (Sen. Elizabeth Warren’s bill to refinance student loans died on the senate floor in June). But when a growing sector of these politically powerful Americans are feeling the burden of student loans, they’ll take their sentiments to the polls.
If senior citizens are the ones who will ultimately push lawmakers to take action on student loan reform, let’s get out the vote — even more than usual.
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