Elderly Are Victims of Student Debt
Sharon Edmondson, Washington Legislative Team Member | February 26, 2016
Economists at the New York Federal Reserve released a report that older Americans held significantly more debt last year than in 2003. This "graying of American debt" might not be that surprising, except that it has largely come from one source we don't associate with older people: Student loans.
Debt held by borrowers between the ages of 50 and 80 has increased by about 60 percent over the last 12 years, with student loan debt more than doubling. In their new report, the Fed economists used data on consumer credit and found that total debt balance has increased significantly for older Americans in the past 12 years. Some of that is due to the aging of the population-more older people means cumulative debt totals for the elderly will be higher. But they also found major increases in debt for seniors even after accounting for the aging population.
The student debt crisis is the main driver behind this trend. Over the past 12 years, mortgage debt, home equity lines of credit, auto debt and credit card debt have stayed relatively flat for most elderly borrowers but student debt has increased substantially.