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Is rising student debt affecting retirement savings? Evidence from the survey of consumer finances

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Listed:
  • Birzhan Batkeyev
  • Mine Ertugrul
  • Karthik Krishnan
  • Pinshuo Wang

Abstract

Using exogenous changes in the personal bankruptcy treatment of student loans as well as the level of student debt, we find that student debt has a negative effect on household retirement savings. This negative relation is present for younger and older individuals, and is larger for the latter group, indicating lower levels of retirement savings for precisely those who can least afford it. We also find that student debt is related to greater borrowing on retirement plans. Households with more student debt expect to have insufficient retirement income and are less able to plan financially for the long term.

Suggested Citation

  • Birzhan Batkeyev & Mine Ertugrul & Karthik Krishnan & Pinshuo Wang, 2024. "Is rising student debt affecting retirement savings? Evidence from the survey of consumer finances," The Financial Review, Eastern Finance Association, vol. 59(3), pages 589-623, August.
    • Handle: RePEc:bla:finrev:v:59:y:2024:i:3:p:589-623
    DOI: 10.1111/fire.12386
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    References listed on IDEAS

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