For three years, millions of Americans haven’t had to worry too much about their student loan debt. But that financial anxiety is rising to the surface as the return of payments looms in September.
With household budgets already tight, there is confusion and concern across the US about how people are going to afford the payments. Many are expected to default, while others are resigned to delaying home purchases, falling behind on other bills or making other drastic budget cuts, like shelving plans to help siblings pay for college.
For now, some are putting life decisions on hold as they await a Supreme Court ruling on President Joe Biden’s student debt relief plan, which would forgive up to $20,000 in loans per person. Ally Rooker, a 30-year-old in Detroit with $80,000 in federal loans, is aiming to buy a house and struggling to figure out how much she can afford. She and her partner would be eligible for a combined $30,000 in forgiveness if the plan goes ahead.
Ally Rooker Source: Ally Rooker
Also, her loan servicer changed during the pandemic and she’s not sure how much she’ll have to pay when monthly bills resume — another unknown many borrowers are facing since some providers ended their contracts with the federal government during the pandemic. Although Rooker works a full-time job in public health, she’s started building a content-creation side hustle around nail care on TikTok to pad her income.
“It’s been stressful and hard to keep up with,” she said about the student loan situation. “I feel pretty confident I can put the payment in my budget, but there’s so much uncertainty.”
