Student loan debt in retirement: identifying the correlates and implications for policy, practice and research

What is it about?

Existing research shows that having student-loan debt in retirement is associated negatively with life satisfaction, suggesting that student debt is a bane of retiree well-being. The rationale for this study is to find out the factors associated with owing student debt in retirement, given the adverse effects on the well-being of retired households. Our empirical analyses use secondary data of a nationally representative sample of retired Americans aged 65 years and older (N = approximately 8,000). The findings indicate that financial literacy, age, homeownership, and high subjective financial knowledge are associated with a low likelihood of holding student-loan debt in retirement. However, being Black, postsecondary education, difficulty in covering expenses, financially dependent children, high-risk preference, and spending more than income increases the likelihood of having student debt in retirement. The ensuing discussion will assist financial planners and educators in identifying practical ways to shape decisions regarding student-loan debt holdings in retirement.

Featured Image