New York, NY (PRWEB) August 12, 2012
RoadFish.com men’s lifestyle and finance magazine released their observations regarding the federal government withholding social security due to unpaid student loans, which has increased massively in the past eight months. Their take on this may help consumers by spreading the word, and by encouraging federal officials to address the problem.
According to the Wall Street Journal’s Market Watch, who received its data from the U.S. Treasury Department, the federal government has begun withholding money from those Social Security recipients who have fallen behind on payments to their student loans. The article states that in eight months, the government held back money from nearly 115,000 retirees’ Social Security checks due to unpaid loans. To offer some perspective, Market Watch pointed out that back in 2000, there were only six occurrences of such a thing.
RoadFish.com believes that this could result in a huge financial problem for retiring baby boomers. RoadFish.com’s Senior staff writer is quoted as saying, “We’ve been hearing so much lately about how indebted recent college grads are, but there is a whole other issue of senior citizens being buried by student loan debt. It seems that most of them have taken loans out for their kids or grandkids, and are now being penalized for falling behind on payments. To me, this is a very real issue that needs to be addressed quickly. Otherwise I fear we are going to see thousands of retirees being paid far too little out of their Social Security, leaving them in bad financial shape. Money they were planning on getting is being slashed, and they’re stuck without income and up to 15% less of the money they were anticipating receiving. I wouldn’t be surprised if things like food, medication, and mortgage or rent become a struggle to pay after such cuts.”
The above-mentioned Market Watch article states that the government could withhold up to 15% of somebody’s Social Security on the grounds that they owe loan money. In the first quarter of 2012, the article states that a whopping 2.2 million student-loan borrowers were 60 years old or more. And of that amount, almost 10% of their collective loans were over 90 days past due. And now it won’t be just their credit scores that take a hit, their Social Security checks could be slashed as a result. The founder of Student Debt Crisis, Robert Applebaum, stated, “It’s really a unique problem we haven’t had to face before, and it’s only going to grow.”
Student loan debt is a big issue within the U.S. right now, for college grads and for senior citizens alike. According to American Student Assistance, a non-profit company who works with borrowers for student loan help, stated that in the 2007-2008 school year, $17 billion was handed out in private student loans, marking an increase of a whopping 592% from just ten years earlier. And from 2001 to 2007, the average debt per student loan borrower jumped from $19,300 to $22,700—an increase of 18% in just seven years.
RoadFish.com today urged the federal government to come up with a solution to the growing issue of Social Security cuts. RoadFish.com’s Senior staff writer is quoted as saying, “The solution to overdue student loan debts is not to withhold Social Security money from senior citizens. Clearly they did not have the money to pay the loan, and by taking more of the only income they have left is sure to be catastrophic to their personal finances. It worries me that in just 2012 alone, we have 115,000 retirees getting up to 15% less than what they were planning on in Social Security checks. What will this do to their mortgage, their medication needs, and their food? Action needs to be taken to address this issue, otherwise we will be seeing more and more senior citizens struggling to make ends meet and possibly falling under the poverty line.”
The U.S. Social Security system is protected by the Social Security Act of 1935, and has been amended to include social welfare and social insurance programs. The program is speculated to currently be keeping about 40% of all senior citizens in America (people who are 65 years old or older) out of poverty, and is one of the largest government programs in the world. It pays out more than even Medicare and Medicaid. Senior citizens rely on Social Security checks once they are without an income for things like food, shelter, and medication. According to the Employee Benefit Research Institution, as quoted in the above-mentioned Market Watch article, about 45% of Americans who are between the ages of 48 and 64 years old will not save enough money before retirement to cover basic needs and health care costs beyond their insurance coverage.
RoadFish.com men’s lifestyle and finance magazine today commented on the federal government’s cuts into Social Security over outstanding student loan debt. This action could pose a significant threat to retirees’ personal finances and well-being.
RoadFish.com is a popular online men's magazine which deals with subjects of lifestyle, personal finance, travel, and current events. RoadFish.com readers tend to be men in their 30's and 40's, most of whom have already achieved personal and professional success and are striving towards a bigger goal. RoadFish.com men’s lifestyle and finance magazine features articles about men's luxury items, hot chicks, divorce tips, food and hotel reviews, and tips on how to save and make money. It is owned and operated by Purpose Inc.