Sen. Paul wants to let students use retirement funds to pay down college debt

FRANKFORT, Ky. (AP) — U.S. Sen. Rand Paul wants to combat the rising debt load for college students by allowing them to dip into retirement accounts to help pay for school or pay back loans.

Continue Reading Below

The Kentucky Republican is introducing federal legislation to allow individuals to take up to $5,250 — tax and penalty free — from their 401(k) or IRA each year to help pay for college or pay down student loan debt.

AOC SLAMS BUTTIGIEG OVER AD CRITICIZING TUITION-FREE COLLEGE: 'THIS IS A GOP TALKING POINT'

Parents or spouses could divert money from retirement accounts to help.

Americans collectively owe about $1.5 trillion in student loans.

Paul sees his bill as a step forward to deal with the problem. He says it’s important for Republicans to offer a plan to relieve student debt.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

His bill is called the Higher Education Loan Repayment and Enhanced Retirement Act.