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$36 Billion in Student Loans Is Owed by Americans 60 Years Old and Older

This $36 billion is owed by 2 million older Americans.  Garnishment of their Social Security benefits to pay these student loans has skyrocketed.


Here are the facts:

  • You’ve likely heard that the total amount of student loan debt has surged beyond the amount of credit card and auto loan debt. The actual numbers as of a few months ago are:
    • Credit cards: $693 billion
    • Auto loans: $730 billion
    • Student loans: $870 billion
  • In addition to the student loan debt owed by 60+ year olds, nearly $100 billion is owed by 4.4 million 50 to 59 year olds, and $143 billion by 5.5 million 40-49 year olds. That’s nearly 12 million Americans 40 or older who still owe on student loans.
  • Among all Americans who owe student loans nearly one-third of them are 40 or older. More than one-sixth are 50 or older.
  • Through the Debt Collection Improvement Act of 1996, Congress centralized delinquent debt collection functions at the Department of Treasury, and authorized it to garnish borrowers’ Social Security payments to collect on federally insured student loans. (See p. 4 of this PDF of the Act, or 11 United States Code Section 3716(c)(3)(A)).
  • At the heart of this Act is the following language:

“Notwithstanding any other provision of law… all payments due to an individual under… the Social Security Act… shall be subject to an offset under this section.”

  • In 2000 six student loan borrowers had their Social Security payments garnished, in 2007 that number had shot up to 60,000 borrowers, and by last year 115,000 borrowers had their Social Security payments garnished.
  • The garnishments cannot exceed 15% of the Social Security payment, and must leave the borrower with at least $750 per monthly check.


Note: much of this information is from a recent report by the Federal Reserve Bank of New York, and the U.S. Treasury Department’s latest annual Report to the Congress on U.S. Government Receivables and Debt Collection Activities of Federal Agencies.

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