Updated: Jul 28
Social Security is a critical safety net for many Americans, providing income in retirement or in the event of a disability or other life circumstances. However, many Americans also carry student loan debt, and it is natural to wonder whether this debt might impact their ability to collect Social Security benefits. In this article, we will explore whether individuals with student loan debt can collect Social Security benefits and provide facts, figures, and statistics to support our discussion.
The short answer is yes, individuals with student loan debt can generally collect Social Security benefits. However, there are some circumstances in which Social Security benefits might be offset or garnished to repay student loan debt. For example, if a borrower defaults on a federal student loan, the government can garnish up to 15% of their Social Security benefits to repay the debt. Additionally, if a borrower owes a debt to the federal government, including student loans, the government can offset their Social Security benefits to repay the debt.
It is worth noting, however, that there are some protections in place for Social Security beneficiaries with student loan debt. For example, Social Security benefits cannot be garnished to repay private student loans, and the government can only offset benefits to repay federal student loans or other federal debts.
According to data from the Government Accountability Office, approximately 114,000 Social Security recipients had their benefits offset to repay student loans in fiscal year 2019. The average amount offset was $140 per month, or roughly $1,680 per year. Additionally, the GAO found that the number of older Americans with student loan debt has been increasing in recent years, with the number of individuals age 65 and older with student loan debt increasing from 2.8% in 2005 to 4.2% in 2015.
While student loan debt can impact Social Security benefits in some circumstances, it is important to remember that Social Security benefits are a critical safety net for many Americans and can provide essential support in retirement or in the event of a disability or other life circumstances. Borrowers should strive to repay their student loans to avoid default and potential garnishment of their Social Security benefits.
Individuals with student loan debt can generally collect Social Security benefits, but there are some circumstances in which benefits might be offset or garnished to repay student loan debt. According to data, the number of older Americans with student loan debt is on the rise, and borrowers should strive to repay their loans to avoid potential impacts on their Social Security benefits.