Older adults with student debt at risk of losing some Social Security benefits [Video]

Millions of older adults who are behind on their student loans could soon receive a smaller Social Security benefit.

That was the warning from Democratic lawmakers, including Sen. Elizabeth Warren, D-Mass., and Sen. Ron Wyden, D-Ore., in a recent letter to the Biden administration.

“When borrowers are in collections, on average their Social Security benefits are estimated to be reduced by $2,500 annually,” the lawmakers wrote on March 19. “This can be a devastating blow to those who rely on Social Security as their primary source of income.”

The U.S. government has extraordinary collection powers on federal debts and it can seize borrowers’ tax refunds, wages and retirement benefits. Social Security recipients can see up to 15% of their benefit reduced to pay back their defaulted student debt, which “can push beneficiaries closer to — or even into — poverty,” the lawmakers wrote.

After the pandemic-era pause on student loan payments expired in October of …