Student loan debt and Social Security

How important is it to pay off student loan debt? Well many people don’t realize that the Federal government can garnish your Social Security check to pay off federal student loans. The Department of Education, which provides federal student loans to borrowers, say it tries to work out payment plans with people who fall behind on their loans. A spokesman for the department, said that accounts aren’t sent off to collections until almost two years of non-payment; if collection doesn’t yield results, the loan balance goes to the Treasury Department, which can reduce Social Security checks. For its part, the Treasury Department said it reaches out to borrowers twice to set up a payment plan or otherwise resolve their debt before offsetting money from their Social Security check. And the Treasury won’t withhold money from monthly checks that total $750 or less. Sometimes student loan debt is from someone co-signing for a child or grandchild, sometimes it’s from someone seeking higher education later in life. Just be aware student loan debt can follow you right into retirement.