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The number of older Americans taking on student debt on behalf of their children and grandchildren has quadrupled in the past decade, with consumers over 60 now holding $66.7 billion in student loan debt, according to a new report by the Consumer Financial Protection Bureau.

The skyrocketing cost of college has placed a particular burden on older Americans, many of whom are struggling to pay back growing debts in their retirement years, according to the report. Nearly 40 percent of federal student loan borrowers over age 65 are in default, the highest rate for any age group, the data show.

“Student loan debt is clearly an intergenerational problem, and what we’re seeing is that this is unfortunately putting older consumers’ retirement at risk,” said Seth Frotman, assistant director of the Office for Students at the CFPB. “Older Americans are struggling under the weight of student loan debt.”


Americans owe nearly $1.4 trillion in outstanding student loans. A slow job market recovery, growing income inequality and stagnant wages have made it difficult for younger Americans to be economically independent, and now there are signs that those financial struggles are dragging down their parents and grandparents as well.

“A large portion of older student loan borrowers struggle to afford basic needs,” the report said, adding that older borrowers were increasingly likely to have skipped necessary doctors’ appointments and prescription medications because they couldn’t afford them.

A growing number of borrowers over age 65 also said their Social Security benefits — often the only source of regular retirement income for older Americans — had been seized because of unpaid student loans, according to the report. Those with student loan debt also had less money saved for retirement than their counterparts without student debt did.

The escalating cost of college — and the insurmountable debts that follow — were a hot-button issue during last year’s presidential campaign. Democratic candidate Bernie Sanders won the support of millions of millennials in part by promising to offer free tuition at all state colleges and universities.

For his part, President-elect Donald Trump has said he would reduce the burden on borrowers by capping federal student loan payments at 12.5 percent of their income. After 15 years, their debts could be forgiven entirely, he said in an October speech in Ohio.

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“Students should not be asked to pay more on their loans than they can afford,” he said. “The debt should not be an albatross around their necks for the rest of their lives.”

While Americans between the ages of 18 and 39 continue hold most of the country’s student loan debt, older Americans are increasingly affected as well.  A record 2.8 million Americans over age 60 had outstanding student loans in 2015, up from 700,000 in 2005, the report said.  Older Americans are also taking on larger swaths of student debt — the average borrower over 60 now owes $23,500 in student loans, nearly double the $12,100 they did a decade earlier, the report said. On top of that, many also have mortgages, auto loans and medical debt.

“When you’re retired, you’re on a fixed income and there are so many things that could go wrong — your house could get a leaky roof, you might need medical care — and it becomes very difficult for people to balance all of those expenses,” said Maggie Flowers, associate director of economic security at the National Council on Aging in Arlington.

Nearly three-fourths of borrowers over age 60 said they owed money for a child or grandchild’s education, as families struggle to keep up with rising education costs. A four-year degree now costs about $181,480 from a private university and $80,360 from a public one, according to estimates from the College Board.

And increasingly, older borrowers are being taken by surprise by student loan debt, according to financial advisers. Often parents and grandparents co-sign loans — the majority of student loans are co-signed by people age 55 and up — assuming they’ll be off the hook once the borrower graduates from school and lands a job. But increasingly, that not the case.

“What we started to see in 2008, 2009, during the recession, is that the jobs just aren’t there for young graduates,” said Mark Stinson, a senior advisor for FAI Wealth Management in Columbia, Md. “What that means is that parents and grandparents are unwittingly taking on their debt — and that’s a position a lot of people just weren’t expecting to be in.”

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