Teacher can’t afford to retire with $155,000 student loan debt

  • Lori Harrell owes $155,000 in student debt.
  • After a 20-year career as a teacher, she doesn’t know how she will be able to afford to retire.
  • She was turned down by two federal teacher loan forgiveness programs.

Lori Harrell, 60, is a teacher and has a bachelor’s degree in education as well as two master’s degrees – but she advised her son not to go to college.

“When I was coming, the parents were saying either you go to school or get a job, so I went to school,” she told Insider. “The advice I gave him was that you don’t really need to go to school unless you know exactly what you want to do.”

Harrell, who was a public school teacher in New York for more than 20 years, is nearing retirement. But with $155,000 in student debt, she doesn’t know how she can afford to go through with it.

Currently, she works as a special education teacher at the Wyoming Correctional Facility in Attica, where she has worked for four years. Previously, she taught special education classes for middle and high school students, but switched to a government job in order to have a better pension and benefits like health insurance when she retires.

But even though she has been planning to retire for the past few years, her debt remains a £155,000 elephant in the room. A few years ago, it consolidated its mix of federal and private loans. She also started an income-based repayment plan, which determined how much she owed per month based on her salary. She paid about $300 a month before the student loan payment break at the start of the pandemic. These payments mostly went towards interest and barely changed his principal amount.

Many Americans are going through the same thing as Harrell, having to adjust their retirement, housing and healthcare plans based on their total student debt. Those eligible for a civil service pardon like Harrell often have high hopes of relief after 20 years of payments, but face prohibitive bureaucratic hurdles or are turned away outright.

“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 out of this,” Harrell said. “I will die with this debt.”

“Retirees should not have student debt”

Harrell said she had struggled to cope with her debt over the past few decades – and the loans themselves were prohibitive.

“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 that kind of stuff,” she said. “It never got to the point where I couldn’t feed him or myself, but it was tough.”

Harrell never defaulted on her loans, she said, but she was often late. Borrowers seeking income-based repayment, which is almost exclusively available to people with federal debt, often report that the monthly payment amount offered by loan companies is unrealistic.

Early in her career, Harrell said, student loan companies estimated her salary — which determined her monthly payments — was $30,000 more than she actually earned. Now, decades later, she still doesn’t earn that amount.

Harrell was among those deemed ineligible for a pardon through the Teacher loan forgiveness program, because it has had student loans since 1979, outside of the initial eligibility window of 1998.

She was also denied the cancellation of civil service loans by the federal government. Prior to the Biden administration, 98% of borrowers who applied for the PSLF were turned down due to paperwork errors and poor management of the program by the student loan company. For this reason, the Department of Education has announced reforms to the program, including a waiver until October 31, 2022 that allows all previous payments, including those previously deemed ineligible, to be considered in the loan cancellation progress.

Harrell applied again a few months ago once the Biden administration rolled out its reforms, but has yet to hear back.

In the meantime, she said she was considering selling assets that belonged to her mother, who died a few years ago, in order to meet her debt.

Debt “is going to be a problem when I have reduced income,” she said of retirement. “I’m thinking of selling the house…and that will be part of my plan in the next couple of years.”


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John A. Bogar