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Student Loan Payments to Restart in October

The long-awaited end of the student loan payment pause is finally here. The Biden administration has announced that federal student loan payments will restart on October 1, 2023. This means that borrowers will once again be required to make monthly payments on their student loans.

The payment pause was originally put in place in March 2020, at the start of the COVID-19 pandemic. At the time, the government was concerned that borrowers would be unable to make their payments due to the economic downturn caused by the pandemic. The pause has been extended several times since then, most recently in December 2022.

The decision to restart student loan payments has been met with mixed reactions. Some borrowers are relieved that the pause is finally coming to an end, while others are concerned about how they will afford to make their payments. The Biden administration has said that it will provide some relief to borrowers, such as by offering a six-month grace period and by expanding income-driven repayment plans.

However, many borrowers are still worried about how they will manage their student loan debt. The average student loan balance in the United States is now over $30,000. This means that many borrowers will be struggling to make their monthly payments, even with the government's help.

The restart of student loan payments is a major milestone in the recovery from the COVID-19 pandemic. However, it is also a reminder of the challenges that many borrowers are facing. The Biden administration has said that it is committed to helping borrowers manage their student loan debt. However, it remains to be seen how effective these efforts will be.

What you can do to prepare for the restart of student loan payments:

  • Start by figuring out how much you owe. You can get this information from your student loan servicer.

  • Create a budget and see how much you can afford to pay each month. Be sure to factor in other expenses, such as housing, transportation, and food.

  • Consider consolidating your loans. This can help you get a lower interest rate and make it easier to manage your payments.

  • Look into income-driven repayment plans. These plans can cap your monthly payments at a percentage of your income.

  • Contact your student loan servicer if you need help. They can help you create a payment plan that works for you.

The restart of student loan payments is a big change, but it doesn't have to be a disaster. By taking steps to prepare, you can make the transition as smooth as possible.

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