Esther D’Amico
The Biden administration has forgiven another $1.2 billion in student loan debt for about 153,000 borrowers enrolled in the Saving on a Valuable Education (SAVE) repayment plan.
To be eligible for this debt relief, SAVE enrollees must have been making at least 10 years of payments on a federal student loan of $12,000 or less, the Department of Education (DOE) said.
Eligible borrowers should have begun to receive emails this week from President Joe Biden letting them know that their loans are forgiven and that they will not need to take any further action to receive relief. Next week, the DOE plans to begin to email borrowers who can become eligible for loan cancellation if they switch to the SAVE plan.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
This part of the plan was originally set for implementation in July but the administration announced last month that it would accelerate the timeline. The DOE said it will implement the remaining benefits of the plan, however, in July.
Launched last August, the SAVE student loan plan is an income-driven repayment (IDR) plan that calculates a borrower’s monthly payment using monthly income and family size as key determiners.
The latest action brings the administration's total student debt cancellation, under various programs, to almost $138 billion for nearly 3.9 million borrowers. This includes $4.8 billion in loan forgiveness for roughly 80,000 Americans in December 2023 as well as $9 billion in loan forgiveness for about 125,000 Americans in October 2023 — both through fixes to IDR and Public Service Loan Forgiveness programs.
President Joe Biden launched the program following the Supreme Court's decision last June to reject his sweeping $400 billion student loan debt relief plan, a key part of his campaign promise to help borrowers get out of debt. Last October, federal student loan payments resumed after a three-year, pandemic-induced hiatus.
The DOE's Federal Student Aid Office offers a step-by-step guide on repaying student loans with tips including how to review your loan balance, choose a repayment plan based on your income as well as various loan forgiveness options.
Other government resources include the DOE's Benefits.Gov, which a wealth of information on various loan programs offered by the federal government.
Related Content
-
Stocks at New Highs as Shutdown Drags On: Stock Market TodayThe Nasdaq Composite, S&P 500 and Dow Jones Industrial Average all notched new record closes Thursday as tech stocks gained.
-
Government Shutdown Puts IPO Resurgence at RiskThe IPO market has been sizzling in recent months, but the government shutdown threatens to put a short-term halt to public offerings. Here's why.
-
Amazon AI on Prime Day: Deal Helper or Upsell Machine?Amazon’s Rufus chatbot, Alexa voice deals, and Amazon Lens can change how you shop on Prime Day. Here’s how to use them wisely — and avoid being upsold.
-
Moving Abroad? You Might Need a Cross-Border Financial AdviserIf you want to live in another country long term, you could benefit from an expert's guidance. Here's how to find a good qualified adviser to help with residency requirements, documentation, financial laws and tax impacts.
-
What Happens to Your Money in a Government Shutdown?From benefit checks to IRS delays, here’s what could affect your wallet if the government shuts down.
-
What Happens to National Parks During a Government Shutdown?A guide to what stays open and what's at risk — and how to plan your park trips when federal funding stalls.
-
My Husband and I Retired at 67 With $3.2 Million, But He's Frugal About Travel. How Can I Convince Him to Loosen Up?We asked financial planning experts for advice.
-
Eight Ways to Stay Safe When Making Cashless PaymentsConsumers are ditching cash for the convenience of digital payments, but fraudsters are right behind you. Just a few simple steps can help you stay safe.
-
I'm a Financial Planner and a Parent: Here Are Five Money Habits Every Young Family Should HaveWhen children are young, it can be hard to meet immediate costs, let alone save for the future, but these five habits can help build lasting financial security.
-
How to Master 'The Art of Spending'Delve into Morgan Housel's new book for an understanding of the psychology that drives what we buy — and why that can lead to smarter money decisions.
