Although the recession technically ended more than two years ago, it continues to affect the millions of people in Georgia and throughout the U.S. who are still struggling to find work. After many months of unemployment, many middle-aged people are deciding instead to go back to school, hoping that additional education will make them more marketable to potential employers. This has led to an unprecedented increase in student loan debt among middle-aged Americans.
According to a credit score tracking website's analysis of more than 3 million credit reports, people between the ages of 35 and 49 have seen their student loan debt has increase by nearly 50 percent. In that group, people aged 38 to 41 have the highest student loan burden, with about $12,000 in debt. This is an increase from 2009, when the average student loan debt for that group was a still-high $9,000.
Educational borrowing continues to increase across the board, economists say. Currently, young people between the ages of 26 and 29 have the highest outstanding loan amounts, with an average of $14,000 due to lenders. Americans now owe more on student loans than they do on credit cards, which we discussed in a recent bankruptcy blog post. And because student loans are not dischargeable in bankruptcy, they have the potential to cause much greater long-term damage to borrowers.
It is easy to see how additional school could seem like a good career move for the long-term unemployed. For some, it is. But if you are considering going back to school, make sure to consider the true costs and benefits of incurring additional student loan debt.
Source: Reuters, "Middle-aged borrowers piling on student debt," Mitch Lipka, Dec. 27, 2011