At a Glance

President Biden attempted to cancel up to $20,000 in student loans per borrower, but the Supreme Court blocked this effort, saying he had no authority to do so. Interest has begun accruing on these student loans as of September 1st, 2023, with payments set to be due at some point in October, depending on the borrower. I made my first payment on October 1st, 2023. Here’s everything you need to know about student loan repayment.



The average federal student loan debt per borrower.

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The basics: how to find what you owe and how you pay

Before you can figure out how to adjust your budget to incorporate student loan payments, you need to figure out what you owe and who you owe to. Answer these questions:

  1. Who is the lender?
  2. What is the interest rate?
  3. How do you determine your monthly payment and repayment plan options?

Shortly, I’ll share my chart with this information. It could be helpful to copy that chart and insert your own information to keep things consolidated and clear. The largest student loan servicers are MOHELA, Aidvantage, and Nelnet. Contacting these agencies is a great place to start if you’re unsure where you owe.

Official government tools

There are several tools available to help you determine your monthly payment plan and compare the different repayment options. Always use official government resources to avoid potential scams. Start with the student loan repayment page from the Federal Student Aid office. Here, you can see all the repayment plan options and learn how to pay your loans off faster. You can also find out more information on your loan servicer.

There are eight different repayment plans to choose from, so be sure to read about each to see which might be the best fit. You can also use the student loan simulator to compare plans based on your income and loan terms.

Adjusting your monthly budget

When you’re already struggling to make ends meet, it can be tough to add in student loan payments, which can be hundreds of dollars each month. I personally have four student loans – one for each year I went to college. My student loan servicer is Aidvantage. When I log onto my account, I see a bunch of information. The most important of which is the due date and amount owed. The amount owed is determined by the payment plan you choose. More on that in a bit.

Disbursement date Name Type Principal Current Balance Interest Rate Amt. due monthly Estimated repayment date
2016 1-01 Direct Loan Unsubsidized $5,500.00 $6,173.96 3.510% $47.94 7/01/2034
2017 1-02 Direct Loan Unsubsidized $6,500.00 $7,165.60 4.200% $56.66 7/01/2034
2018 1-03 Direct Loan Unsubsidized $6,500.00 $6,933.66 4.800% $56.66 7/01/2034
2019 1-04 Direct Loan Unsubsidized $7,500.00 $7,597.66 4.280% $65.37 7/01/2034
TOTALS $26,000.00 $27,870.88 $226.63

Estimated total loan amount to be paid: $35,398.30

Estimated total interest to be paid: $9,398.30

I initially chose the Revised Pay As You Earn (REPAYE) Income-Driven Repayment Plan. Under this plan, I would have paid $317.75 each month and was expected to repay my loans by May of 2030. I would have needed to recertify my income and other information each year, so my payments would have increased as long as my income increased. However, this plan was automatically replaced by the Saving on a Valuable Education (SAVE) Income-Driven Repayment Plan.

The SAVE plan was introduced by President Biden and helped lower payments for borrowers. I’ll likely switch back to the REPAYE plan soon so I can pay off my loans more quickly and pay less interest over time. When you enroll in autopay, you receive a 0.25% reduction in your interest rate. Every little bit helps, so I highly recommend everyone enrolls in autopay. I will already be paying over $9,000 in interest over the life of my loan, so I want to save where I can. Just keep enough in your bank account each month to avoid overdrafting when it comes out.

This is obviously a pretty decent-sized addition to my monthly budget. Adding in $226.63 each month, or more than $2,700 each year, isn’t easy. Instead of shifting my spending to accommodate this change, I’ve decided to increase my revenue. As a freelancer, I can choose how many projects to take on each month. If I can add on an extra article or two, I can cover this increase with some to spare. This isn’t the case for everyone, especially those making a set salary. If that’s the case, you’ll need to look through your budget with a fine tooth comb to see where you can cut back so there’s room for these payments.

What is President Biden doing about loan forgiveness?

President Biden has continued his efforts to forgive student loans. He’s made it clear that it’s a priority and has successfully been able to forgive student loans for hundreds of thousands of eligible borrowers under existing policy. However, it seems that broad student loan relief is off the table, at least for now. The Education Department has explored other avenues for debt relief. Meetings with those stakeholders happened this week, and a comprehensive relief program seems impossible. It’s too early to tell the exact outcome, but I don’t think people should get their hopes up. Instead, focus on how to pay your loans off as quickly as possible. If relief happens, that’s an added bonus.

Bottom line

It’s not easy to incorporate an additional few hundred dollars into your budget, but it is possible. Hopefully, President Biden will be able to offer some relief. If not, you need to remain focused on paying your loans each month. Enrolling in autopay is a great way to pay less interest over time and to ensure you never miss a payment. With so many repayment plans available, you can likely find one that works for you.