(Politico)
The powerhouse lobby has its eye on a growing drag on old-age savings.
As student loan debt has ballooned over the past two decades, the issue has moved from the sidelines of wonky policy debates into a full-fledged campaign issue, with even presidential candidates playing to the economic anxieties of parents and recent college grads. In the latest sign of just how far-reaching student loan debt has become, the issue is now on the radar of another, perhaps more surprising group: AARP.
Over the past several years, the nation’s leading senior lobby has become increasingly involved in student-loan issues, pressuring the federal government to stop garnishing the Social Security benefits of older borrowers who defaulted on their loans. And in some state capitals the group is taking on the student loan industry, pushing for more regulations to police abusive loan-collection practices.
A retirement organization may seem like an unlikely force for reform of student debt. But AARP’s involvement underscores just how long a shadow student loans are increasingly casting over Americans’ economic lives—a shadow that stretches all the way into their retirement. Remarkably, Americans over 60 years old are the fastest-growing category of student loan borrowers, having roughly quadrupled in number between 2005 and 2015, according to the Consumer Financial Protection Bureau. Although older borrowers still account for just a sliver of the more than $1.5 trillion in total outstanding student loan debt, they’re more likely than younger borrowers to be behind on payments. Most are repaying debt they took out to help finance the education of their children or grandchildren, though some are still paying off their own tuition.
“We consider it a looming threat,” said Lori Trawinski, director of banking and finance at the AARP Public Policy Institute. A central concern, she said, is how student debt—for themselves and their children—can delay key financial milestones like home ownership and chip away at retirement savings....
