Borrowers who are age 60 or older are the fastest-growing age group for student debt, according to the Federal Reserve Bank of New York. Their numbers have tripled since 2005, and 12.5 percent of their student loans are delinquent. For these borrowers, retirement can mean fielding creditors’ insistent phone calls while living on a fixed income that won’t ever cover the bills. It can mean having Social Security payments garnished to service student loan debt.
As the Financial Times notes, the problem has gotten so bad that parents are beginning to take out life insurance policies on their adult children to protect themselves in case their children die before they pay off their loans.An even better option than life insurance would be to do a little more bargain hunting. The Guardian reports that 41 percent of Americans are considering attending less selective but cheaper schools to minimize their debt. This number should be higher. There are plenty of less-selective schools that still offer a quality education, and graduating with low or zero debt may be at least as important as a name-brand degree.[Ball and chain image courtesy of Shutterstock]