Former California state government worker Thomas Villalobos, 66, who is currently unemployed, never thought he’d be nearing retirement and still paying off his student loan. But that’s exactly what has happened to him.
Villalobos, of Loma Rica, Calif., borrowed $12,000 to attend law school back in 1976. Since then, he has sometimes had to defer the loan payments due to a cash shortage, adding interest to the principal. Villalobos figures he’s paid $31,000 in interest over the years and the loan’s balance is right back where it started: $12,000.
Villalobos is looking for work so he can continue making the $160 monthly payments until he’s eventually free and clear. He’s also facing the prospect of watching his 15-year-old son take on student loans when he graduates from high school. “This is no way to educate American students,” Villalobos says. “It’s all about money, not education.”
While much attention has been given recently to the increasingly heavy toll that student-loan debt is exacting on young Americans, there has been less acknowledgment of the gnawing financial threat it represents for boomer retirement.