Not only are a worrying number of Australians retiring with a mortgage, figures from the Australian Taxation Office reveal that a significant number of retirees are also carrying student loans.

ATO figures show that 97,417 people aged 60 and above were carrying HELP (tertiary student) debt at an average of $13,400 each on June 30 2018.

For the 69,488 people with student debt between 60 and 70, the average was $13,847.

For the 27,929 people over 70 with HELP debt, the average burden was $11,293.

That news comes hard on the heels of revelations that the average mortgage debt being carried by those over 55 was $185,000 in 2015 and has probably climbed higher.

As would be expected, the highest levels of HELP debt was held by those between 20 and 30 who collectively owed $33.64 billion, an average liability of $24.437.

Overall HELP debt stood at $61.92 billion owed by 2.873 million Australians at an average of $21,561 in June 2018.

Student debt continued to rise strongly in the year to June 2019, when it increased by $7.9 billion, or 12.7 per cent.

This was made up by approximately $6.9 billion in ‘new’ HELP debt, and $1 billion resulting from the indexation rate applied by the ATO. 

There is no interest charged on HELP debt but in recent years it has been indexed by the rates shown in this table. 

As at 30 June 2019, the total of HELP debt was over 66.5 billion. 

The burden of HELP is rising because the standard of tertiary education required to get into graduate positions is also climbing.

“HELP debt keeps going up, especially for those who are doing a masters degree,” said Desiree Cai, president of the National Union of Students.

“In some cohorts over half the students are post graduate,” she said.

“We would like to see people graduating with less debt overall but increasing university fees and cuts to funding by government mean this is not happening,” Ms Cai said.

Why are seniors carrying HELP debt?

There are a couple of reasons why older people are likely to be carrying HELP debt.

“Because you only start to repay HELP when you reach a certain income level, if you have been a low income earner or gave up work to be a carer, you could find yourself carrying debt into your 60s and 70s,” said Stephen Anthony, chief economist with Industry Super Australia.

HELP debt only begins to be repaid when you hit an income level of $45,881 (down from $51,957 last year).

At first it is paid off at 2 per cent a year but this figure rises through income bands to finish at 10 per cent for those earning $134,573 or more.

Another driver of HELP debt among older people is “people going back to study,” said Ian Henschke, chief advocate with National Seniors Australia.

While that might sound like an interesting choice it is often brought on by factors like divorce.

“You could have a situation where a woman who works as a nurse is married to a doctor but leaves the workforce for a number of years to raise children,” Mr Henschke said.

“Then, in her 50s she gets divorced and has to go back to university to upgrade her nursing qualifications and as a result is left with HELP debt as she retires.

Women returning to the workforce also sometimes need to re-skill, Mr Henschke added.

“The figures speak for themselves but divorce can play a key factor. A third of women and one quarter of men on the age pension live in poverty,” he said.

The New Daily is owned by Industry Super Holdings