On March 13, 2020 as the country was dealing with fallout from the Covid-19 pandemic, President Trump temporarily paused Federal Student Loan Payments. Over the last 3 and a half years, the pause has been extended several times but it was recently announced that the latest pause, which ends on September 30, 2023 will be the final pause. In other words, loan repayments will resume in October 2023.
So, what do you need to do?
You will receive a billing statement or other notice at least 21 days before your first payment is due. The notice will inform you of the due date and how much you will need to pay.
Unless you signed up for auto payment after March 13, 2020 or if you opted out of the payment pause, you will need to confirm your auto-debit enrollment with your Loan Servicer before payments will resume. So, now is the time to dust off that account user name and password and get into your account
You’ll need to reset your budget to factor in these additional payments. It probably felt great to have that little extra room in your budget, but that time is coming to an end. It is easy to spend the dollars you used to pay monthly on other things. This “lifestyle creep” is so common…the extra money is there so it gets spent.
To potentially find the money for the upcoming payment, track your spending for the next month. This is a great way to uncover areas that you can cut back on to afford this new payment. Then, sharpen your pencil and hammer out a new budget based on our new reality.