Student Loan Stories: A Senior Citizen Hard Hit by Residual College Debt and Struggling
August 20, 2014

Today we take a look at one of the faces of dealing with student loan debt. This is not about someone in their 20s or 30s struggling with student loans, but a woman in her 70s. We’ll look at why she took on the student loans, why they’re still lingering decades later and the damage it’s doing to her finances now. Plus we’ll also take a look at how her situation may be getting better sooner in ways she never thought possible. Our story today is about Amanda Fletcher (not her real name), age 75 who lives in St. Louis, Missouri and is getting by on Social Security.

Elderly hard hit by college debt

Lingering student loans hit the elderly hard
Image Source: Flickr Creative Commons User Ant Jackson

Here’s how Amanda ended up with student loans

“I got married out of high school in 1959 when I was just 18. My husband had a good union job and we had two kids right away. I was a stay at home mom and our finances were steady. We had another kid when I was 30 but a few years later, the marriage fell apart. By the time my youngest was and the two oldest were getting out of high school we were done and I had to work for the first time in my life. I bounced from job to job with no real skills, remarried and then when my youngest was 16, I started thinking about college for the first time.

My daughter was an Honors student and decided to take a couple of classes at the local community college over the summer before her Senior year. She wasn’t a good enough driver to get into the city alone, so I drove her and sat in the library reading while she attended her classes. With time on my hands, I began to explore the campus and finally went down to admissions for a chat. I never thought that I could go to college, but they encouraged me and I applied and enrolled. They also told me money was no trouble and signed me up for student loans. I was so excited about the opportunity, I didn’t blink and signed the forms.”

Here’s where the trouble began

“I didn’t finish college. That was the real problem. I finished up a year at the community college then when my daughter moved out of state for college and my second marriage was crumbling, I decided to move back home close to the family we had moved away from a few years prior. I enrolled in college but it was more costly than community college. I also struggled with my grades, had to retake a couple of classes then had to change to a costlier school when I moved. The student loan forms were given to me to sign each quarter and I really had no clue how much I had borrowed.

After nearly four years of school, I still had no degree because I changed majors a few times and couldn’t stay in school because I needed to work full time. I remarried but between work and my new husband, school fell off my radar. I got statements in the mail, but couldn’t afford to pay my student loans, so I didn’t. I took out a forbearance, then a deferment, then simply gave up on thinking about the debt. At first there were collection calls, but I moved a few times, my numbers changed, I wasn’t working and the calls and letters pretty much stopped.”

The debt that never goes away

“I really had not worked more than part time after my mid-50s. I always had back problems and then when I gained weight, they worsened. When I hit 65, I went on Social Security while my husband still worked but then he injured his back and retired also. That put us living on just Social Security fixed income and that’s when the student loans showed up again. I wasn’t getting a ton of money from my SS payments and then about six months after they started, my check was suddenly significantly less. I checked it out and saw that I had been hit by a garnishment for my unpaid student loans.

I got a statement and the $30k I had borrowed had ballooned to more than $80k and I was told to get used to the garnishment because it would never go away. It’s not a huge garnishment – about $150 a month, but it’s 15% of my Social Security check and makes finances very tight. This is enough to cover my groceries for the month or my electric bill. I’ve had to put off repairs to my car, postponed getting refills on medication I need and my money is always check to check and the garnishment doesn’t help.”

A possible solution to help

Amanda’s story is heartbreaking and typical for many people. Because student loans never go away, they will always catch up. And because her garnishment isn’t even covering the interest, she’s still considered to be in default. But the new rule that came online July 1st that we recently wrote about may help her. We’ve encouraged Amanda to contact her loan servicer about the new rehabilitation process. Because her income is close to the federal poverty line, her rehab payment should be just $5. If she can pay this for five months, she should be able to request the government stop garnishing her social security checks for the student loans.

From there, after making 9-10 payments of $5, her loans should be rehabbed and she can apply for Income Based Repayment. Based on her low fixed income, her payments should be $0-$10. At this payment level, interest will keep accumulating and the loan balance will get higher. But after 25 years of these micro payments her balance will be forgiven. We’re hoping Amanda, and anyone in a similar situation, takes advantage of this new option to get free of student loan payments they can’t afford and that are making their retirement years financially untenable.

No matter how old or young you are, sign up for’s free student loan tool to check out your debts and find out more about repayment plans. And be sure to read our blog often for student loan and money advice.