Student debt impacts older generations, the economy & culture
FOX 11 is taking an in-depth look this week at the high cost of higher education. Coverage includes a town hall meeting Thursday on the issue of student loan debt.
America's record $1.2 trillion of student debt is impacting people into their later years of life, along with the U.S. economy and culture.
More than a third of outstanding student debt belongs to people older than 40.
"It's not just an 18-to-30-year-old problem," said Kathryn Champagne of Marinette.
The 61-year-old Champagne says she has an outstanding student loan around $35,000. She was working on a degree through an online university until three years ago.
"I was at least halfway through my master's program in special education when I lost my job, and I could not continue I could not continue in the program without special needs students that I was using for case studies," she said.
Now working just part-time, Champagne is not optimistic about repaying that debt.
"I'll probably die first before I ever pay off that loan," she said.
Dean Listle of Secure Retirement Solutions in Ashwaubenon says he's heard plenty of similar stories.
"We're seeing a trend of more seniors now taking student loans into their retirement," said Listle. "And if you're not able to afford them prior to retirement, it's very hard to afford them once your payroll quits and you're retired."
Research shows 40 million Americans have at least one outstanding student loan - with an average balance above $27,000.
"That's a lot of people that have basically purchased their first really nice car," said Kevin Quinn, an economics professor at St. Norbert College in De Pere.
Quinn says student debt is stopping people from making major purchases, seen as part of the American dream.
"How do you add on to that? How do you add on to $30,000 another $30,000 for a car? How do you add on to that another $150,000 or whatever it is for a house?" he said.
It's impacting our culture as well.
"We're seeing a delay in household formation," Quinn said. "People aren't getting married as quickly because they're not going to then start having kids and all that sort of thing before they pay off some of the student loans."
Twenty-eight-year-old Nicole Kattner of De Pere has a master's degree from UW-Green Bay in social work.
"It kind of scares me, too, because I'm sitting there thinking, 'Okay, I'm getting to the age of wanting to be a mom, and I don't want to bring my kid into the world where I'm sitting on $70,000 of student debt,'" said Kattner.
Her debt is impacting decision she makes with her fiancé.
"If we're going to go into a duplex to save money, if we're going to move out of the area. Those have all been discussions over the last three years because of my college debt," she said.
Quinn says recent graduates with a lot of debt are moving to cities based solely on job prospects.
"That all kind of snowballs culturally, and we're starting to see millennials now congregate more and more into urban-like settings where there are lots of opportunities for jobs. And that can harm a lot of small towns here in Wisconsin," he said.
Data from the United States Census Bureau shows how high student debt loads are impacting family budgets. Young college-educated families owe nearly $5,000 a year on student loan repayments. That's more than they spend each year on groceries or car payments.
Champagne says her biggest concerns are about younger generations with debt of their own.
"My daughter, her husband, they cannot afford a $700 a month student loan payment, plus a car payment, plus a mortgage payment," she said.
As about 70 percent of college graduates leave school with debt, it's an issue for the economy that isn't going away soon.
Tuesday night on FOX 11 News at Nine, we'll have tips for families getting ready for college and for people with student debt. And Wednesday, a look at alternatives to four-year universities.