Student loan debt is the bane of many adult American lives, hitting parents and grandparents who borrow for loved ones the hardest, says a study by TIAA-MIT AgeLab.
Nearly half (43%) interrupted the flow of their retirement savings and said they will increase the amount of savings once the student loan for their children and grandchildren is paid off.
The report said women, in particular, described the struggle of sacrificing their own financial security in retirement in order to put their children’s education and well-being first.
The yearlong study, which explores the intersection of student loan debt, longevity planning and family dynamics, found that 84% of American adults report that student loans are negatively impacting the amount they are able to save for retirement, and nearly three out of four (73%) borrowers report they are putting off maximizing their retirement savings.
It noted that as a result of student loan debt, 26% of Americans are not at all saving for retirement. The percentage jumps to 39% for those ages 25 to 35, who cite student loan as their priority.
Many borrowers, the report said, indicated that they did not discuss finances—including student loans—with their family. In fact, 40% of borrowers with loans for themselves and 36% of borrowers with loans for a child or grandchild report never speaking with their family about their student loans.
It also pointed out that over half of borrowers with loans for themselves (51%) and nearly one-third of borrowers with loans for a child or grandchild (31%) report their family knew “nothing” or “very little” about their student loans.
The report also found that student-loan worries have impacted borrowers’ romantic relationships. But that varies with the amount of debt. Only 6% of borrowers with a loan amount of $9,999 or less report a negative effect on romantic relationships, compared to 34% of borrowers with an initial loan amount of $200,000 or more.
Further, borrowers with higher initial loan amounts said they had to delay traditional milestones due to student-loan debt, the report said.
Thirteen percent of borrowers who took out $24,999 or less report that loans affected the timing of their marriage, compared with 37% of those who took out $150,000 or more; 19% of borrowers with an initial loan amount of $24,999 or less say that the loans affected when they had children, compared with 51% of those with $150,000 or more; and more than a third (36%) with an initial loan amount of $24,999 or less and the majority (74%) of those with $150,000 or more say that the loans affected when they planned to buy or bought a home.