Recent college graduates working toward paying off their debt is hardly a new concept. However, what some financial organizations might not be aware of is that student loans can affect borrowers many decades after they graduate.
A recent USA Today article highlighted an increasingly common trend of Americans who have children in college and are trying to balance those newer student loans along with their own remaining debt. The news source cited data from the New York Federal Reserve, which said that student loan debt is the only form of consumer debt that has grown since the peak of consumer debt in 2008.
Specifically, Americans 50 to 59 years old owed $112 billion in student loan debt at the end of 2012. That is a huge jump from 2005, when that age group owed just $34 billion. Additionally, the Fed reported that the average amount owed per person has also increased. Now, the average is $23,820, which is an increase from the $14,714 owed in early 2005.
Credit counselor Melissa Towell told the news source that she works with clients who are older and are trying to balance their own student loans and that of their children.
"Thirty percent of my clients are in that bracket of 50 and older, either worrying about paying back their children's loans or paying back their loans," Towell said. "A lot of them just say, 'I'm going to die before I pay this off.'"
While banks cannot control whether an individual needs to take out student loans, this is important information to keep in mind in terms of acquiring new borrowers. With comprehensive credit application software, organizations can be sure that they find creditworthy borrowers who are successfully managing any prior debts.