- Lori Harrell owes $155,000 in student debt.
- After a 20-year teaching career, she doesn’t know how to afford to retire.
- She was turned down by two government loan-forgiveness programs for teachers.
Lori Harrell, 60, is a teacher and has a bachelor’s degree in education and two master’s degrees – but she advised her son not to go to college.
“When I got upstairs, the parents said you should either go to school or get a job, so I went to school,” she told Insider. “The advice I gave him was that if you don’t know exactly what you want to do, you don’t really have to go to school.”
Harrell, who was a New York public school teacher for over 20 years, is nearing retirement. But with $155,000 in student loan debt, she doesn’t know how she can afford to handle it.
She currently works as a special education teacher at the Wyoming Correctional Facility in Attica, where she has been for four years. She previously taught special education to middle and high school students, but then switched to a government job so she would get a better pension and benefits like health insurance when she retired.
But even as she’s made retirement plans in recent years, her debt remains a £155,000 elephant in the room. A few years ago, it consolidated its mix of federal and personal loans. She also started an earnings-based repayment plan that determined how much she would owe monthly based on her salary. She was paying about $300 a month before the student loan payments paused at the start of the pandemic. These payments were used primarily for interest and little changed their principal amount.
Many Americans are going through the same thing as Harrell, having to adjust their retirement, housing, and healthcare plans based on their students’ total debt. Those who, like Harrell, qualify for a public service forgiveness often have high hopes for relief after 20 years of payments, but face prohibitive bureaucratic obstacles or are turned away altogether.
“I’m at the point where I’m going to retire in two years and I don’t know how I’m going to get there,” Harrell said. “I will die with this guilt.”
“Pensioners shouldn’t have student debt”
Harrell said she’s struggled to keep up with her debt over the past few decades — and the loans themselves have been prohibitively expensive.
“When I was raising my son as a single parent, it was all about taking care of the rent, the food, him, his activities and things like that,” she said. “It never got to the point where I couldn’t support him or myself, but it was tough.”
Harrell never defaulted on her loans, she said, but she was often late. Borrowers seeking income-contingent repayment, which is almost exclusively available to those with government debt, often report that the monthly payment amount offered by lending companies is unrealistic.
Early in her career, Harrell said student loan companies estimated her salary — which determined her monthly payments — at $30,000 more than she actually earned. Now, decades later, she still doesn’t earn that much.
Harrell was among those deemed ineligible for a forgiveness under the Teacher Loan Forgiveness program, having had student loans outside of the original 1998 eligibility window since 1979.
She was also turned away from the federal government’s granting of public service loans. Before the Biden administration, 98% of borrowers who applied for PSLF were turned down due to clerical errors and mismanagement of the program by student loan companies. Because of this, the Department of Education announced reforms to the program, including a waiver through October 31, 2022, allowing all previous payments, including those previously deemed ineligible, to count toward loan forgiveness progress.
Harrell reapplied a few months ago after the Biden administration implemented its reforms, but has yet to receive a response.
In the meantime, she said, she is considering selling assets owned by her mother, who died a few years ago, to keep up with her debt.
Debt “is going to be an issue when I have a lower income,” she said of retirement. “I’m thinking about selling the house … and that’s going to be part of my plan for the next few years.”