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More older Americans caught in student debt crisis

social security card corner
File photo | Kelsey Proud | St. Louis Public Radio
A social security card.

An increasing number of older Americans are having problems with student loan debt — so much so that their Social Security checks are being reduced because the federal government is withholding loan repayments.

And those reductions result in Social Security recipients falling below the poverty line.

That’s the finding of a Government Accountability Office report sought by Sens. Claire McCaskill, D-Mo., and Elizabeth Warren, D-Mass. The report concludes that Congress should consider adjusting withholdings from Social Security checks to reflect the increased cost of living.

In a statement calling attention to the report, McCaskill noted that the rapid escalation of student loans are a more widespread problem than most people realize.

“This report shows that seniors clearly aren’t immune to the student loan crisis,” McCaskill said. “They’re deeply impacted by this issue to the point that it’s leaving many of them in a dire financial situation.”

Among the report’s findings:

— The more than 7 million Americans over the age of 50 who have student loan debt is a group growing much faster than those who are younger.

— Since 2005, Americans aged 65 and up saw their total student loan debt grow by 385 percent.

— The number of Americans whose Social Security checks are being garnished to recover defaulted student loan payments has increased by 540 percent in the past 10 years, to more than 114,000 older borrowers.

— Since 2004, the number of seniors whose Social Security benefits have been garnished to a level below the poverty line has increased to 67,300, from 8,300.

— Thirteen percent of borrowers aged 50 or older at the time money was first withheld from their benefit checks died while their loans were still outstanding.

— Between 2001 and 2015, 43 percent of older borrowers whose checked were garnished for the first time had held student loans for 20 years or more.

— In fiscal year 2015, more than half of the 114,000 older borrowers who had money withheld from their benefits were receiving Social Security disability checks rather than retirement income.

“We could have hundreds of thousands of American seniors living in poverty due to garnished Social Security benefits if this trend continues,” McCaskill’s statement said, “and we shouldn’t allow that to happen.”

Follow Dale on Twitter: @dalesinger

Dale Singer began his career in professional journalism in 1969 by talking his way into a summer vacation replacement job at the now-defunct United Press International bureau in St. Louis; he later joined UPI full-time in 1972. Eight years later, he moved to the Post-Dispatch, where for the next 28-plus years he was a business reporter and editor, a Metro reporter specializing in education, assistant editor of the Editorial Page for 10 years and finally news editor of the newspaper's website. In September of 2008, he joined the staff of the Beacon, where he reported primarily on education. In addition to practicing journalism, Dale has been an adjunct professor at University College at Washington U. He and his wife live in west St. Louis County with their spoiled Bichon, Teddy. They have two adult daughters, who have followed them into the word business as a communications manager and a website editor, and three grandchildren. Dale reported for St. Louis Public Radio from 2013 to 2016.