As the world transitions toward a semblance of normalcy, so too do the financial responsibilities that have lain dormant for the past few years. Federal student loan payments, set to resume in October, are on the horizon, and for many, they represent more than just a financial obligation. They are the unwelcome guests at a table already burdened with the weight of suffocating debt.

The statistics are stark: According to CNBC, when student loan payments resume, a staggering 56% of borrowers are faced with an agonizing choice – to allocate funds to loan repayments or to cover basic necessities like groceries and rent. Although the impact skews towards those making $50,000 or less, 45% of borrowers with household incomes of $100,000 say they will struggle to make their debt payments and afford necessities. Therefore, regardless of income, the resumption of student loan payments will be a challenge after a reprieve over the past three years.

However, as we confront this challenge together, we want you to know that Budge stands as a pillar of support, providing education, coaching, and solutions to ease the burden. Our mission has always been to empower individuals on their journey to financial stability, and in the face of this impending challenge, our commitment remains steadfast.

The Save Plan: A Lifeline for a Smoother Journey

For those with federal student loans, the Save Plan is a beacon of hope. Tailored for borrowers seeking a lower monthly payment than the standard 10-year repayment plan, this plan offers a lifeline. If you have undergraduate loans, you're in luck. The Save Plan offers major improvements over existing income-based repayment plans.

  • Lower Payments: The Save Plan redefines affordability by exempting more income from payment calculations and reducing the income percentage for undergraduate borrowers from 10% to just 5%.
  • Balance Protection: Say goodbye to escalating loan balances. With the Save Plan, as long as you meet your minimum monthly payment, your balance will remain untouched by interest.
  • Enrollment: If you're already in the REPAYE program, you'll be automatically enrolled in the Save Plan once it's operational. Not on REPAYE? Enroll or switch now via StudentAid.gov and take control of your financial journey.

Fresh Start: Breathing New Life into Your Financial Story

If default is a word that has haunted your financial narrative, let the Fresh Start program be your second chance. Designed for federal student loan borrowers in default, this program offers a chance to regain control.

  • Credit Revival: The Fresh Start program brings your loans back to "current" status, erasing the stain of "in collections" from your credit reports and potentially boosting your credit score.
  • Halt to Collections: Put an end to collection efforts – no more intrusive calls, wage garnishments, or tax refund seizures.
  • Multiple Opportunities: Even if you've tried and failed before, the Fresh Start program doesn't close doors. It's a chance to rekindle your financial journey and access federal student aid for further education.

Take action today, via https://myeddebt.ed.gov/.

‍One-Time Account Adjustment: Crafting a Clearer Path to Forgiveness

The financial landscape can be confusing, but the government's One-Time Account Adjustment is a clarion call for transparency. Addressing the complexities of income-based repayment plans paves the way for qualified borrowers to see periods that didn't count towards forgiveness finally acknowledged.

  • Inclusive Recognition: Payments from any repayment plan, forbearance periods, economic hardships, and more – this adjustment encompasses them all.
  • Your Path to Clarity: Understand your loans. Determine eligibility. Your journey to financial liberation starts with knowing your options.

To understand the types of loans you have reach out to your student loan servicer or log into your StudentAid.gov account. If you have Direct or FFEL Program loans held by the Department of Education and have any payments that qualify, your account will automatically be updated later this year. If you have FFEL, Perkins, or Health Education Assistance Loan (HEAL) Program loans, you’ll need to consolidate your loans before the end of 2023 to benefit from the one-time adjustment.

​A Budge Coach is Here to Help!‍

As the daunting reality of student loan payments restart approaches, the time to act is now. Don't let your financial well-being hang in the balance. Reach out to me today to check in on your current plan and make any adjustments as needed knowing Student Loan Payments restart October 1st.

​Schedule a Call Now: Click Here to Schedule a Call

‍Remember, you are not alone on this journey. Budge is here to be your guiding light, offering support, solutions, and a community that understands the challenges you face.