Thinking About Education Costs in Your 50s or Older

Getty Images Dealing with the costs of education isn't just a task for the young anymore. Even for those 50 or older, student-loan debt has become a key concern, with the latest figures from the Federal Reserve Bank of New York showing that those ages 50 to 59 had $112 billion in outstanding student loans -- almost 12 percent of all student debt -- while those 60 and older had $43 billion in student loans. Moreover, default rates among those 50 or older have jumped sharply in the past eight years, with 60-plus borrowers seeing default rates double from 6 percent in early 2005 to 12.5 percent at the end of 2012. Older Americans face unique financial challenges that can make repaying educational debt more difficult. Yet as college costs rise, many people older than age 50 want to try to help their children and grandchildren with educational expenses to avoid seeing future generations burdened with heavy debt. Let's examine to some ways older Americans can achieve both of those goals. 1. Recognize the Danger of Debt. The student-loan burdens that those 50 or older face are often much more difficult than those for their younger counterparts. With much of the debt they take on representing parental loans or cosigned loans for children and grandchildren, they often lack the flexibility in repayment terms that younger borrowers enjoy. Most private loans and parental loans don't offer income-based repayment options or other ways of reducing monthly payments, yet bankruptcy and other options of last resort won't get rid of them. Last year, reported that 119,000 retired Americans were having part of their Social Security benefits garnished to repay student loans. Make sure you understand the terms that govern tyour deb. Know your repayment options and prioritize the most burdensome loans first before turning to loans with more favorable rates and terms. That will give you the best chance to get your debt under control while you're still in a position to deal with it. 2. Don't Sacrifice Your Own Financial Future. When you hit your 50s, you're really reaching crunch time in terms of providing for your retirement. As your earnings peak, you'll never have a better time to put large amounts of savings toward that nest egg.