We tend to think of student debt as a mostly millennial problem. But new data reveals that the number of seniors 60 and over with student debt quadrupled between 2005 and 2015. As such, an estimated 2.8 million older Americans are now on the hook for outstanding loans, and they're compromising their retirement in the process.

The danger of student debt later in life

Why do seniors have so much debt? It's not necessarily that they're going back to school themselves. Rather, many seniors will either take out loans on their grandchildren's behalf, or act as co-signers on their grandkids' loans. Either way, the end result is the same: More seniors owe money for college today than ever before, and it's a major problem.

Senior man holding his head while looking at paperwork.

Image source: Getty Images.

Why so? As is the case with any sort of debt, the problem with carrying student loans later in life is that those monthly payments can monopolize a large chunk of your income. And when you're no longer earning a paycheck, but rather, are just scraping by on your limited savings and Social Security benefits, you need every dollar you can get your hands on to pay for your basics.

But here's another reason why student loans are so dangerous for seniors in particular: If you don't pay them on schedule, you risk having your Social Security benefits garnished. That's precisely what happened to an estimated 173,000 Americans who defaulted on their student debt back in 2015. Therefore, if you have a period where you incur major medical expenses, and as such, can't make your loan payments, you risk having a portion of your Social Security income withheld until you make good on that debt. And that's not a predicament you deserve to be in, especially if you weren't the beneficiary of those loans in the first place.

A safer alternative to student debt

It's noble to want to help younger generations in your family pay for college. But before you rack up debt in an effort to assist, there are other steps you can take that don't come with the same level of risk. For one thing, aid your grandchildren in identifying scholarships, which can easily defray the cost of college at no cost to you.

Another option is to put some money into a 529 plan for your grandchildren to use. The great thing about 529 plans is that they're fairly flexible. You can switch beneficiaries on your plan as you please, and there's no time limit by which you must start taking withdrawals from your account. This means that if you find yourself with a bit of spare money while you're still working, you can put that cash into a 529, and it'll grow tax-free for your grandkids (or whomever else you want to help pay for college).

Finally, rather than take out student loans in your own name or cosign your grandchildren's loans, keep that debt separate, but aim to help them pay off those loans to the best of your ability. This way, if your circumstances change and you find yourself financially squeezed, you're not liable for payments you can't afford.

When you're no longer earning an income, the last thing you need on your head is a nagging stream of student loan payments. So don't put yourself in that position. Generous as it may be to want to ease the burden on your family, remember that your grandchildren have their whole lives ahead of them to repay that debt, whereas you do not. And that's reason enough to be as supportive as possible without putting your retirement on the line.