Marketplace Morning Report: What It's Like Repaying Student Loans at 70

Release Date: May 19, 2025

In this insightful episode of Marketplace Morning Report, hosted by Nova Safo in place of David Brancaccio, listeners are guided through pressing economic developments and a deeply personal exploration of senior citizens grappling with student loan debt. The episode seamlessly weaves macroeconomic trends with individual narratives to paint a comprehensive picture of the current financial landscape.

Rising U.S. Treasury Yields and Economic Implications (01:03 - 03:50)

The episode opens with a discussion on the recent uptick in long-term U.S. government bond yields. Nova Safo introduces the topic by highlighting that the 30-year Treasury yield has surpassed 5%, a significant milestone attributed to downgrades by Wall Street's major credit rating agencies.

Julia Coronado, founder and president of Macro Policy Perspectives, provides expert analysis:

“It tells us that the United States is bumping up against fiscal limits, that international and domestic investors are starting to charge the US more interest for its lack of fiscal discipline and potentially a little bit of the policy volatility that we've been seeing this year.”
(01:39)

Coronado elaborates on "policy volatility," referencing trade wars and a perceived breakdown in the rule of law, which heightens risks for long-term investors. The conversation pivots to the direct impact on consumers:

“It means consumers have to pay more to borrow. So mortgage rates are going to follow the treasury yields higher, as are rates on car loans and basically any kind of consumer borrowing. So consumers will feel the impact. Money is more expensive.”
(02:24)

This rise in borrowing costs signals tighter financial conditions ahead, particularly detrimental to sectors like real estate that were anticipating relief on interest rates. Coronado expresses concern over the broader economic outlook for the year:

“Yeah, absolutely. We had come into the year hoping for lower yields. A lot of sectors, real estate sectors in particular, were hoping for some relief on interest rates and we're just not seeing that.”
(02:58)

The segment concludes with a brief mention of the U.S. credit rating slipping below that of several European nations and the announcement of a new post-Brexit trade deal between Britain and the European Union aimed at reducing cross-border red tape.

Repaying Student Loans in Retirement (04:20 - 08:01)

The core of the episode delves into the challenges faced by older Americans still burdened by student loan debt. Marketplace's senior economics contributor, Chris Farrell, introduces the story of Lorelai Taylor, a 70-year-old from San Diego managing her finances on Social Security and modest self-employment income.

Lorelai Taylor shares her experience:

“I kind of do whatever anyone needs help with. Like one gal I'm working with now, her husband passed away. She can't emotionally handle getting rid of his clothes. I go every week for a few hours and we go through her house and I take away the stuff so she doesn't have to deal with it.”
(04:51)

Despite making consistent payments over the years, Taylor still owes $17,000 on her student loans, accumulated from her education in her early 40s at Washington State University. The narrative highlights the broader trend of senior loan borrowers, with the number of individuals aged 62 and older carrying student debt increasing sharply.

Kartik Manekin, a graduate student at the New School for Social Research, provides context:

“Amount of that debt is also debt that's more than 10 years old. So, like very much beyond the point of when you would expect them to have been able to pay off that debt.”
(06:20)

Taylor participates in the SAVE program (Saving on a Valuable Education), an Income-Driven Repayment Plan that offers flexibility. However, the program faces legal challenges and political uncertainty, leaving borrowers like Taylor in a precarious position:

“I'm still buying groceries, and even if I was, when I was making the payments, you know, it just has loosened up my tiny little budget, you know, a bit. And I can buy an extra handbag a year. That's my kryptonite. And other than that, I live pretty frugally or, you know, purposefully.”
(06:55)

Farrell underscores the severity of the issue, noting a 3,000% surge in Social Security beneficiaries facing loan garnishments between 2001 and 2019, a number expected to grow as the federal government resumes loan repayments in May. The segment concludes with a discussion on the uncertain future of federal student loan policies, as various political entities propose reforms amidst a tumultuous system.

Closing Remarks (08:01 - 08:40)

The episode wraps up with acknowledgments of the collaborative efforts underpinning the "Buy Now, Pay Later" series, highlighting a partnership with Next Avenue, a nonprofit dedicated to news for older adults. While brief ads and light-hearted exchanges occur towards the end, the core content provides a compelling look into the intersection of economic policy and personal finance challenges faced by the aging population.

Key Takeaways:

• Economic Shift: The rise in U.S. Treasury yields above 5% reflects fiscal constraints and policy volatility, leading to higher borrowing costs for consumers and potential slowdowns in sectors like real estate.

• Senior Debt Burden: A growing number of older Americans are still repaying student loans, with many entering retirement years still owing significant amounts. Programs like SAVE offer some relief, but legal and political obstacles create uncertainty.

• Policy Implications: The evolving landscape of federal student loan policies poses additional challenges for senior borrowers, with potential increases in loan defaults and garnishments impacting Social Security recipients.

This episode of Marketplace Morning Report offers both macroeconomic insights and human stories, highlighting the intricate ways in which government policies and financial systems directly affect individual lives, especially among the elderly.