Retired, or Hoping to Be, and Saddled With Student Loans
When Patrick Donohue retired in May after a 20-year career in customer service at AT&T, he and his wife, Kay, didn’t celebrate. Instead, they argued over which pension option was better: obtaining a large portion right away or scheduling small monthly payments.
At issue was whether the lump sum might free them from paying further interest on the $97,932 they borrowed from the federal government so their four daughters could attend college, or if doing so would mean sacrificing their long-term financial stability. Ultimately, they settled on the monthly payments, guaranteed for both their lifetimes.
“Kay’s position was, we would outlive the lump sum,” said Mr. Donohue, 64, of San Diego. His inclination to take it may have been just as practical, though: “After eight years of paying off loans, my concern was that we didn’t have much of a cushion if we encountered a major expense.”
It’s a dilemma more American retirees can relate to: While most borrowers are 18 to 39 years old, people over 60 are the fastest-growing segment of the population with student loan debt, according to a report by the Consumer Financial Protection Bureau.
https://www.msn.com/en-us/money/retirement/retired-or-hoping-to-be-and-saddled-with-student-loans/ar-BB10pQ3l?li=BBnbfcN&ocid=hplocalnews
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