Student Debt Threatens Home Ownership, Entrepreneurship, and Retirement Savings

In a recent OpEd on Politico.com, Rohit Chopra, student loan ombudsman for the Consumer Financial Protection Bureau, noted that the skyrocketing rise of unmanageable student debt is draining all aspects of the broader economy.  

Consider this:  

• Student loan borrowers are far less likely to qualify for mortgages, thereby delaying home ownership and the establishment of separate households.  In 2011, 2 million more Americans in the 18-34 age group lived with their parents than in 2007.  Moody’s Analytics estimates that each new household formed leads to $145,000 of economic impact.  
• Student debt diminishes entrepreneurship and small-business growth.  Entrepreneurs need capital to get business ideas off the ground.  Unmanageable student debt often makes small business loans harder to acquire, thereby preventing many small businesses from ever getting off the ground.
• Student debt is a risk to retirement security.  AARP believes that for families headed by an American ages 50-64, “increasing debt threatens their ability to save for retirement or accumulate other assets, and may end up requiring them to delay retirement.”

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