Government Seizes Social Security Checks Of 173,000 People
People who want job security need to have a college degree, but it comes with a big price. There are 40 million Americans who have earned their college degrees that can’t pay back their student loan debt. And, it appears that even the older generation, going into retirement, is having a hard time paying back their debt.
Jaime Chastain is a retiree who took out a $12,500 loan in 1982 to get his Master’s degree in Liberal Arts. Without a steady job, he was unable to pay his loans and they went into default. He was able to find a teaching job at a community college, and the government garnished $400 each month from his paycheck.
Chastain, 68, retired in 2014 but had yet to finish paying off his loans. This has led the government to withhold $177 a month from his Social Security checks for over a year. He suspects, with interest, he’s paid more on the loan that he originally took out.
In 2015, in an effort to get the money borrowed back, the government has taken money from roughly 173,000 people’s social security checks. The amount doesn’t just include retirees but also younger people who are getting disability benefits. This number is anticipated to increase.
According to Fortune, the government has seized more than $1 billion since 2001 to recollect the student loan debt people owe.
The Washington Post states that 3.6 million people were behind on their federal student loan payments. However, since June, over eight million people are in default, which means they have not made on payment on their loans since that time. Based on the current law, anyone who is in default on their student loans can have their wages, income tax refunds and other federal payments seized.
What can people do if they can’t pay their student loans? The Department of Education offers the Income-Driven Repayment Plans to help people from defaulting on their loans. This kind of repayment loan is based on your income, which means if a person is unemployed they won’t owe anything until they get another job.
How Will The Next Administration Handle The Federal Student Loan Repayment?
Throughout the campaign trail, Donald Trump said he would like the federal student loan payments to be capped at 12.5 percent. He said, under his program, it would make it more affordable for people to pay back their loans. And, if people make their payments for 15 years, they can get on with their lives.
It’s the most liberal student loan repayment plan to date.
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