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ATLANTA (FOX 5 Atlanta) - We know student loan debt is crushing young people. But here's something I bet you don't know: Student loan debt is crushing senior citizens, too. Yep, folks 60 and over are carrying $86 billion in student loan debt.
Wow, right? According to the Wall Street Journal, senior citizen student loan debt in the US now stands at $86 billion. Add in fixed incomes, rising insurances costs and that's a problem.
How in the world did we get here? Well, after the market crashed in 2008, folks went back to school and many took out loans to help pay their children and grandchildren's education.
AARP with the Association of Young Americans surveyed Baby Boomers and found this debt is preventing 31 percent of them from contributing to their retirement fund. Thirty-three percent can't get another car, and 18 percent can't move to a new home.
OK, that's the problem. What's the solution? You may want to consider refinancing your student loan. Yes, you can do that. And sometimes it's a good idea but sometimes it isn't. Let me lay the groundwork for this discussion by saying this - you can refinance both government and private student loans. If you have a private loan and you can qualify for a lower rate, it's a go. It's a different story with a government student loan.
Here are 3 THINGS TO KNOW before refinancing. First, the Department of Education won't do it. You have to go to a private lender to refinance. Second and third, by refinancing your government loan, you are no longer eligible for loan forgiveness or income-driven repayment, meaning you can't change the terms of the loan if you take a lower paying job. So, if the lower interest rate - and ultimately, lower payment - is worth losing these protections then do it.
You will need a credit rating at least in the high 600s. If you don't have that. you may need a co-signer.