According to the Biden administration’s announcement this week, millions of Americans will soon have to start making their monthly student loan payments again. Student loan interest will commence on September 1 and the initial loan payments will become due in October.
Over the past three years, the federal moratorium on student loan payments—introduced at the height of the pandemic—has been renewed nine times. Due to this delay, borrowers are unsure of the exact day they must start making payments again. Hannah Willow, a recent York College alumna who was able to save money and pay off some personal loans while buying a house, expressed her relief at the extension.
However, the start of debt payments and the ambiguity surrounding President Biden’s student loan forgiveness plan have put many borrowers in a difficult predicament. Conrad Siegel’s Tracy Burke counsels borrowers to begin making plans for repayment and proposes analysing budgets to make changes for student loan repayment.
While some people might have little trouble restarting their payments, others will have trouble. While cutting back on necessary spending could be difficult, there are ways to free up money for debt repayment.
In order to manage forthcoming repayments, Hannah Willow is limiting her home budget and thinking about taking on a second job. She is still optimistic about obtaining financial independence in the future, despite the difficulties.
The US Supreme Court will now decide whether or not to implement President Biden’s proposal to forgive up to $10,000 or $20,000 in student loan debt. The court’s decision, which is anticipated in the coming weeks, might put to rest the current discussion about student loan forgiveness.