For college-goers and college graduates, school debt may be a burdensome payment that can follow individuals around until retirement, affecting consumer credit
data and loan applications.
Recently, the San Francisco Gate reported that the federal government has begun withholding Social Security payments from recipients who haven't paid their school loans in a timely manner. From the beginning of January through August 6, 115,000 Social Security recipients saw their checks garnished as a result of delinquent school loan payments. This represents a severe increase from 2007, when 60,000 checks were reduced, and 2000, when only six cases were enforced. "This is going to catch an awful lot of people off guard and wreak havoc on their financial lives," Sheryl Garrett, a financial planner, told the newspaper. Furthermore, the enforcement process could become even more problematic in the future, as recent reports found that student loan debt in the U.S. now exceeds the total amount of credit card debt.