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By Elizabeth Gravier: July 30th 2021
There are far fewer 50- to 61-year-olds who still carry student loan debt compared to younger age groups, but those that do have high average balances.
According to statistics from the U.S. Department of Education’s Q4 2020 data, borrowers in this age group have an average balance of $42,290.32, which is nearly as much as the highest average debt load of $42,373.23 carried by the age bracket below them (35- to 49-year-olds).
But while these two age groups, 35-to-49 and 50-to-61, have a similar average balance, the number of overall loan borrowers drastically decreases after age 49. There are just 6.2 million borrowers in the older age group, compared to 14.2 million borrowers in the younger age group.
The numbers illustrate a scenario of borrowers being at different ends of the spectrum. There are those who have completely paid off their student loans by their 50s — signaled by the big drop-off of borrowers — and also those who still have a good chunk of debt to pay off with all the interest that has accrued over most of their adult years — signaled by the high average debt balance.
The data also accounts for parent borrowers who took out student loans in their own name to help finance their children’s college education.
Refinancing student loans in your 50s
Whether you are paying off your own student loans or managing the parent PLUS loans you took out for your child, refinancing through a private lender can help you get rid of the debt once and for all.
Given you likely have had your loans for years by the time you turn 50, you may have already refinanced numerous times. The good news is you can refinance your student loans as many times as you’d like. You can also take advantage of your age: If you’ve been building a history of on-time loan payments all these years, you may have a higher credit score and be in a better spot to qualify for a lower interest rate.
Before you refinance: With the current federal student loan payment and interest freeze, we do not recommend that you consider refinancing any federal or parent PLUS loans until the forbearance ends on Sept. 30, 2021. Refinancing federal loans removes all unique governmental protections like deferment and forbearance, income-driven repayment plans, forgiveness programs and widespread student loan cancellation.
Refinancing private student loans amid reported inflation
While interest rates remain low, now is a good time to lock in a lower refinancing rate on your private student loans before rising inflation causes rates to go back up — which has been predicted to happen in late 2022.
To secure a low rate today, you should choose a refinancing lender that offers fixed interest rates. Select analyzed and compared private student loan funding from national banks, credit unions and online lenders to rank your best options. All of the companies on our best-of list offer a variable and fixed refinancing interest rate to choose from, as well as low refinancing rates, flexible loan terms, no upfront origination fee for refinancing or early payoff penalties and financial hardship protection. Read more about our methodology on choosing the best student loan refinance companies below.
- Best overall: SoFi Student Loan Refinancing
- Best for having a co-signer: CommonBond Student Loan Refinancing
- Best for fair credit score: Earnest Student Loan Refinancing
- Best for parent loan refinancing: Education Loan Finance Student Loan Refinancing
- Best for medical school loan refinancing: Laurel Road Student Loan Refinancing
Refinancing with a fixed rate versus a variable rate means that you’ll pay the same low interest rate for the remaining life of the loan. This is even more beneficial for your wallet if your salary keeps up with the pace of future rising inflation, so you’re earning more and accruing less interest. If you pick a variable-rate refinanced loan, its rates are subject to change. When inflation likely triggers rate-increases, variable-rate student loans will also see higher interest rates.