Senior Americans burdened with student debt

- Rosemary Anderson could be 81 by the time she pays off her student loans.

After struggling with divorce, health problems and an underwater home mortgage, the 57-year-old anticipates there could come a day when her Social Security benefits will be docked to make the payments.

Like Anderson, a growing percentage of aging Americans struggle to pay back their student debt. Tens of thousands of them even see their Social Security benefits garnished when they cannot do so.

Among Americans ages 65 to 74, 4 percent in 2010 carried federal student loan debt, up from 1 percent six years earlier, according to a Government Accountability Office report released Wednesday at a Senate Aging Committee hearing.

 

Student debt for all ages totals $1 trillion.

 

Typically, student loans can't be discharged in bankruptcy. In addition to docking Social Security, the government can use a variety of tools to recoup student loans, such as docking wages or taking tax refund dollars.

 

Sandy Baum, a senior fellow at the Urban Institute, said these seniors having their Social Security docked likely don't have much discretionary income and Congress should consider taking away this option.

 

 There's a limit to how much Social Security can be docked, but some seniors are left with benefits below the poverty level, the GAO said.

 

"It's not an issue that affects large numbers of people," Baum said. "It's a very big issue for people who are affected by it."