Student Loan Updates with Kylie & Tina
On this episode of Financially Naked: Stories from The Financial Gym, hosts Kylie and Tina, both Certified Financial Trainers, dive into the ever-evolving world of student loans. While we've covered this topic before, the landscape of student debt is constantly shifting, making it crucial to stay updated. From the rollout of the SAVE plan to new forgiveness proposals and essential tips for managing your loans, Kylie and Tina provide the latest insights and practical advice you need to navigate your student loans.
Podcast Notes
When it comes to student loans, Understanding your specific loan situation is important. Your repayment options vary based on income, loan type, and personal budget.
If you're struggling to make your current payment, income-driven repayment plans (IDRs) can be a good option. These programs are designed to lower your monthly payment and forgive the balance after a certain number of payments are made.
The pause on student loan payments expired in October 2023, which means most borrowers have made their first payments since then. To help borrowers, a new income-driven repayment plan called The SAVE Plan was rolled out.
The SAVE Plan has multiple phases. The first happened when payments resumed, and the second phase will be live later this summer. This new phase will lower borrowers' payments even further.
The SAVE Plan has many benefits. In addition to lower payments for many borrowers, it prevents interest from increasing their original balance. This plan improves on existing IDR options and is designed to help more borrowers.
Steps for Managing Your Student Loans
Make sure you know who your current loan provider is and have the necessary login information. If you're unsure who your provider is, you can find the information on your studentaid.gov account.
Payments resumed in October, but there's an 'on-ramp period' for those who haven't begun paying yet. This means you still have time to take action if you've missed payments since the pause ended.
Log in to your loan servicer's website and determine how your payments fit into your monthly budget. IDR plans like the SAVE plan can help lower your monthly payments.
You can use the calculators on studentaid.gov to compare monthly payment options under different plans to figure out which is best for you.
Many areas of the student loan program are getting updated and changed. These transition times can be frustrating because updates are slow, and information is hard to find. Don't be discouraged, and ask for help if you need it.
Updates to the Systems & Plans Available
With the new updates, specific IDR plans are being phased out. People already enrolled in those plans can remain, but everyone else must choose from the newer options.
There is an ongoing account adjustment for IDR plans. The Department of Education is updating borrower accounts to reflect accurate loan forgiveness progress, and no action is required from borrowers.
PSLF applications are transitioning to the Department of Education for improved processing and monitoring. The goal is to alleviate frustrations with the private companies that managed these programs in the past.
If you have defaulted on your loans, there is a program to help you get back on track! The Fresh Start program deadline is September 30, 2024. It offers a unique opportunity for borrowers in default to get back on track without the usual complexities.
Just last month, the government announced the possibility of another wave of limited student loan forgiveness. This is all designed to happen automatically, so the borrower does not have to take action.
Resources
Meet The Trainers
Meet Kylie Lipinski, Certified Financial Trainer
Meet Tina Hang, Certified Financial Trainer
If you want to work with a Certified Financial Trainer to help navigate your finances, schedule a free warm-up call today! If you have any ideas or questions for the show, send an email to trainerpodcast@fingyms.com.