A Teachers Insurance and Annuity Association (TIAA) sponsored study maintains student loan debt has a significant impact on retirement savings, longevity planning, and family relationships.
The effort, which was conducted by the MIT AgeLab over one year, determined one-quarter of those not saving for retirement cite student loans as the reason. Among the 25- to 35-year-olds who are not saving for retirement, 39 percent said they are prioritizing student loan payments. Of the parents and grandparents taking out loans for children and grandchildren, 43 percent noted they would increase retirement savings once the student loan is paid off.
“To be sure, getting a college degree remains one of the smartest investments a person can make in their financial future – but saving for retirement is equally important,” Roger W. Ferguson, Jr., president and CEO of TIAA, said. “We believe that advice and coaching are key to navigating what can seem like competing demands. TIAA has found that people who engage with qualified financial professionals are better equipped to make decisions about paying for education for themselves or a loved one without sacrificing their future financial security.”