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The Department of Education Changed the rules for student loan forgiveness

 The Department of Education has "silently" changed the rules to student loan forgiveness that will affect at least 800,000 borrowers. On September 29, 2022 the Department of Education made a few changes for those who obtained the Perkin's and Federal Family Education loan.  Here is the language directly from the Dept of Education "As of September 29, 2022 borrowers with federal student loans not held by ED cannot obtain one time debt relief by consolidating those loans into direct loans". Previously individuals who did obtain theses loans were able to receive loan forgiveness. Figure 1: This is a thumbnail of my latest YouTube video "Student loan forgiveness guidelines have changed" where I am sitting in my office while looking at the camera with a suspicious look.  Many speculate that potential lawsuits could be the reason why the Dept of Ed has changed it's language recently. Long story short the banks who insured these loans will not receive an

Should I Pay My Student Loans?

 

This past week an article came out stating that student loan forgiveness was not in President’s Biden annual budget. I know many of us were like say what now? A few months ago, I did a video on student loan forgiveness as around that time Biden had given the Department of Education’s secretary a task to write a memo regarding if he could cancel student loan debt through executive order. There have not been any updates on that memo and this latest article that student loan forgiveness is not in Biden’s annual budget has somewhat put the writing on the wall that this may not happen after all.



Figure 1: This is a thumbnail from my latest YouTube video on Should I Pay My Student Loans? I have an inquisitive look on my face next to a photo of Biden.

 

I have a student loan balance myself and $10K would basically forgive my debt with a little left over. However, I am unsure if this will happen so I have decided to pay up until I hear otherwise. I actually paid off my second student loan last week and it felt great! In case you did not know, there is a federal hold on student loan interest, which means that whatever you pay will go to the principal balance. This will most likely help you to pay down your loan much quicker. This will end on October 1, 2021.



Figure 2: This is a photo of a green arrow with dollar signs along the arrow as a model for rising interest.


I know my opinion of paying your student loans until Biden makes a decision is unpopular however; the hold on student loan interest is something that needs to be taken advantage of. Also, if your loans are over 10K you are going to have to pay something eventually so what are you waiting for? I know there have been talks on 50K but I’m not even going to go there. I am definitely a person of hope and faith but faith without work is DEAD! So in the meantime I’m choosing to do the work.


Figure 3: This is a photo that says “Do the Work” written in a journal. 


Student loan debt can stop you from reaching your financial dreams and one day you will have to pay. As someone who is currently enrolled in a doctoral program with previous student loan debt another key to not going deeper into debt is to make a decision to not take on any more student loans. I currently work at a university so I receive an employee scholarship and other grant money. Anything left over after these two items are paid out I pay in cash. As I am writing this I just received a $500 grant towards my summer classes. I do understand that finding free money is hard but it is out there so don’t give up.


Figure 4: This is a photo of a $100 bill.


 Also, I would strongly advise against taking out any student loans in hopes that they will be forgiven this is not a good idea! If you’re wondering how I paid off TWO student loans since March I’ve been using the debt snowball method which has changed my finances for the better. Drop down in the comments and let me know if you want to hear more about the debt snowball method. Do you plan on paying your student loans? Why or why not? Be sure to check out my latest video on the subject below!

 

Figure 5: This is a photo of a snowball surrounded by money.


 

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