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Readers say student loan repayments will be ‘devastating’
"If I had known that this would be the sacrifice I would be making in my 30s...I'd have never gone."
Come this fall, the pandemic-era policy that gave 40 million Americans relief from student loan debt will come to an end.
The Education Department announced this week that borrowers will be required to make their first payments in October and interest will start accumulating on borrowers’ debt again on Sept. 1. For the vast majority of borrowers, this will be the first time making federal student loan payments since March 2020. Our readers told us that the end of the payment freeze could be “devastating.”
Former President Donald Trump ordered a payment pause as COVID relief in the early weeks of the pandemic and the pause has since been extended eight times.
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“The emergency period is over, and we’re preparing our borrowers to restart,” Education Secretary Miguel Cardona said at a Senate hearing in May.
As borrowers adjust their budgets and brace themselves for payments to resume, they’re also keeping an eye on President Joe Biden’s debt forgiveness plan, which would cancel up to $20,000 in debt for millions of borrowers and has been stalled by legal challenges. The Supreme Court is set to rule on the case in the next couple of weeks.
In the meantime, readers shared with Boston.com what it will mean for their finances when the three-year freeze on federal student loan payments comes to end in October.
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Responses have been lightly edited for length and clarity.
‘I am in uncharted waters, drowning’
“I will be paying $2,000 to $2,500 per month in graduate school loans (the majority of which are private loans and won’t be forgiven). It is completely unaffordable with the increases in rent and cost of living. Every cent I make will be either going to rent, bills, or loans. I’ve already canceled every subscription, canceled cable, canceled my gym membership, and am currently trying to refinance my old loans as well as find cheaper WiFi and phone plans. I make a decent salary, but because of the high cost of my loans, I have absolutely no discretionary spending or savings in my budget now.” — Amelia, Cambridge
“I will not be able to financially afford my student loan payment as it cuts into my food and gas money. I will not be able to qualify for a home loan. As a first-generation grad student, I am in uncharted waters, drowning.” — Lisa, Phoenix, Ariz.
‘Our generation is the first to not have college mean what it used to’
“I work a salaried position for a health-tech company and have as low of rent as I can find in the Boston area (I’m 33 and I have 4 roommates). I don’t have a car, and when I do need to travel I walk, bike, or take public transport and I’m responsible with how I spend and save my money. Despite that, I still live close to paycheck-to-paycheck because Boston is an insurmountably expensive place to live for anyone without financial assistance from a spouse, partner, or parent.
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I don’t necessarily need to see my loans forgiven completely, but I think our generation is the first to not have college mean what it used to for older generations. I know how much I took out but I don’t believe there should be interest on it, and I think some assistance such as $10-20,000 per borrower forgiven is something we should work towards.
We were told we would never find work and never succeed if we didn’t go to college at a time when housing costs and tuition fees have skyrocketed to astronomical levels while wages and job opportunities have stagnated or dried up. Now, all I hear is older generations say we should have known what we were getting into, we need to take responsibility for our actions, etc. It is incredibly frustrating and just shows how immensely disconnected large portions of Americans are from reality.
Another way to think about it: America runs on consumption. Our economy is based on people consuming. When we all default on our loans or an entire generation of Americans stops buying houses and consumer goods because we are consumed by student debt before we ever even had a chance to get off the ground, that won’t be good.
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I will be able to make my payments, I have been planning for it, but I am postponing the potential of marriage, a family, home ownership, etc, in order to do it. If I had known that this would be the sacrifice I would be making in my 30s to pay off debt from something I was told was a requirement, I’d have never gone.” — Jordan P., Somerville
‘It will definitely hurt me financially’
“Obviously, I’ll have less money to spend on goods and services. I will probably have to get food stamps again.” — Chelsea P., Waltham
“It will impact my life and finances drastically. With the cost of living going up, it has been hard not making ends meet.” — Cynthia, Euless, Texas
“Despite not being paid minimum wage, it will definitely hurt me financially. These loans are predatory. Why is it that PPP loans were forgiven without a second thought but when it comes to student loans people are up in arms about forgiveness being wrong? The U.S. loves corporations more than its people.” — Sen, Boston
Boston.com occasionally interacts with readers by conducting informal polls and surveys. These results should be read as an unscientific gauge of readers’ opinion.
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